Case: 19-1862 Document: 44 Page: 1 Filed: 04/15/2020
United States Court of Appeals
for the Federal Circuit
______________________
ESKRIDGE & ASSOCIATES,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
ANSIBLE GOVERNMENT SOLUTIONS, LLC,
Defendant
______________________
2019-1862
______________________
Appeal from the United States Court of Federal Claims
in No. 1:18-cv-02001-CFL, Senior Judge Charles F. Lettow.
______________________
Decided: April 15, 2020
______________________
TIMOTHY TURNER, Whitcomb, Selinsky, PC, Denver,
CO, argued for plaintiff-appellant.
TANYA KOENIG, Commercial Litigation Branch, Civil
Division, United States Department of Justice, Washing-
ton, DC, argued for defendant-appellee. Also represented
by JOSEPH H. HUNT, ROBERT EDWARD KIRSCHMAN, JR.,
DOUGLAS K. MICKLE.
______________________
Case: 19-1862 Document: 44 Page: 2 Filed: 04/15/2020
2 ESKRIDGE & ASSOCIATES v. UNITED STATES
Before PROST, Chief Judge, SCHALL and WALLACH, Circuit
Judges.
WALLACH, Circuit Judge.
Appellant Eskridge & Associates (“Eskridge”) filed a
bid protest in the U.S. Court of Federal Claims, protesting
the award of a U.S. Department of the Army (“Army”) con-
tract to a competitor. Following Eskridge’s motion for judg-
ment on the administrative record, the Court of Federal
Claims concluded that Eskridge lacked standing, as it was
not an interested party pursuant to 28 U.S.C. § 1491, and
dismissed the protest. See Eskridge & Assocs. v. United
States,
142 Fed. Cl. 410, 425 (2019) (Opinion and Order);
Judgment, Eskridge & Assocs. v. United States, No. 18-
2001 (Fed. Cl. Mar. 19, 2019), ECF No. 26.
Eskridge appeals. We have jurisdiction pursuant to 28
U.S.C. § 1295(a)(3). We affirm.
BACKGROUND 1
In 2016, the Army sought to procure the services of cer-
tified registered nurse anesthetists (“CRNAs”) for the
Womack Army Medical Center, located in Fort Bragg,
North Carolina, by issuing a solicitation (“the 2016 Solici-
tation”). See
Eskridge, 142 Fed. Cl. at 412–13. Relevant
here, the Army performed a price realism analysis of the
proposals made in response to the 2016 Solicitation.
Id.
at 412. Eskridge bid on the 2016 Solicitation, but the so-
licitation was cancelled in 2017 in connection with a cor-
rective action (“the 2017 Protest”).
Id. Later in 2017, the
Army released a preview for a new solicitation for the
CRNAs at Fort Bragg.
Id. at 413. The preview outlined
1 Unless otherwise noted, we will rely on the uncon-
tested facts as presented by the Court of Federal Claims.
See generally Appellant’s Br., Appellee’s Br. Where the
parties disagree, we rely on the record.
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ESKRIDGE & ASSOCIATES v. UNITED STATES 3
the award of a contract on a fixed-price basis for a base pe-
riod of six months, with the addition of four option years to
follow, and estimated a cost of $21,034,111.20.
Id. The
preview also stated that performance was expected to com-
mence on April 1, 2018 and to end by September 30, 2022.
Id.
In early January 2018, the Army filed a solicitation
with bids due three weeks later (“the 2018 Solicitation”).
Id. In addition to listing various requirements and expec-
tations, the 2018 Solicitation provided the method by
which the Army intended to evaluate the bids—the “lowest
price technically acceptable . . . approach.”
Id. (capitaliza-
tion altered). Specifically, the 2018 Solicitation stated that
the Army would “initially list proposals from lowest to
highest price,” and then “evaluate the technical acceptabil-
ity of the five lowest-priced bids.”
Id. (internal quotation
marks and citation omitted). If any of those five bids were
rated technically acceptable, the Army would “not evaluate
any other proposals,” and instead “award the contract to
the lowest-priced, technically acceptable bidder.”
Id. (in-
ternal quotation marks and citation omitted). The price
“would act as a filter,” allowing the Army to review only the
five lowest-priced bids for the detailed technical evalua-
tion.
Id. The Army provided three categories to determine
if a bid was technically acceptable: (1) “[g]eneral compli-
ance with solicitation requirements”; (2) technical merit,
scored on six subfactors; and (3) past performance.
Id. (ci-
tation omitted). In the 2018 Solicitation, the Army set the
minimum compensation rate for a CRNA at $113.89 per
hour, inclusive of fringe benefits.
Id. at 414. The addition
of the minimum compensation rate—which had not been
included in the 2016 Solicitation—was provided in lieu of
the 2016 Solicitation’s price realism analysis, as “the Army
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4 ESKRIDGE & ASSOCIATES v. UNITED STATES
believed the minimum acceptable wage rate acted as a
price realism regulator[.]”
Id. 2
The Army received eighteen timely, complete pro-
posals.
Id. Before the Army could evaluate the proposals,
however, Eskridge filed a pre-award protest with the Gov-
ernment Accountability Office (“GAO”), alleging that the
Army “acted in bad faith” regarding the 2018 Solicitation—
by failing to include language allegedly agreed upon follow-
ing the 2016 Solicitation’s cancellation—and that the 2018
Solicitation was ambiguous.
Id. at 414–15 (internal quota-
tion marks and citation omitted). The Army responded, re-
questing that the GAO dismiss the protest, contending that
Eskridge failed “to allege facts upon which a legally suffi-
cient assertion of bad faith could be based.”
Id. at 415 (in-
ternal quotation marks and citation omitted). The Army
explained that its reference in the 2018 Solicitation to 48
C.F.R. § 52.222-46, which requires compensation realism
evaluations, “fulfilled the Army’s obligation arising from
its informal agreement” after the 2016 Solicitation was
cancelled.
Id. (internal quotation marks and citation omit-
ted); see 48 C.F.R. § 52.222-46. 3 Eskridge withdrew its
2 The 2018 Solicitation was amended multiple times
and included, inter alia, an increase to the minimum com-
pensation rate to $121.22 per hour.
Id.
3 Section 52.222-46 provides for the evaluation of
compensation for professional employees. The regulation
requires that professional employees in the service of the
federal government “be properly and fairly compensated,”
as it is “in the [federal government’s] best interest.” 48
C.F.R. § 52.222-46(a). Accordingly, the regulation provides
requirements that proposals for the solicitations of profes-
sional employees undergo various evaluations to ensure
that the employees are compensated at rates that will en-
sure “uninterrupted[,] high-quality work.”
Id. “Failure to
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ESKRIDGE & ASSOCIATES v. UNITED STATES 5
protest two days after the Army responded.
Eskridge, 142
Fed. Cl. at 415.
After Eskridge withdrew its protest, the Army com-
menced its evaluation process.
Id. The Army sorted the
bids according to price; Eskridge’s bid was not ranked
among the five lowest proposals.
Id. The Army conducted
its technical evaluations of the lowest proposals and, find-
ing three of the five to be technically acceptable, sent noti-
fications to the thirteen unsuccessful bidders, including
Eskridge.
Id. The Army awarded the contract (“Contract”)
to Ansible Government Solutions, LLC (“Ansible”), after
determining that Ansible provided the lowest-priced, tech-
nically acceptable proposal.
Id. at 417.
In March 2018, Eskridge filed another protest with the
GAO.
Id. Eskridge alleged that the Army’s determination
was “unreasonable, capricious, and contrary to law” and
that its “evaluation was ambiguous and contrary to the
terms of the [2018] [S]olicitation.”
Id. (internal quotation
marks and citation omitted). The Army requested that the
GAO dismiss Eskridge’s protest, arguing that Eskridge
was not an interested party “because there were [multiple]
proposals that were evaluated as [t]echnically [a]cceptable
with . . . lower prices than [Eskridge’s] proposal.”
Id. (cita-
tion omitted) (all alterations except ellipsis in original). On
April 1, 2018, while proceedings were ongoing before the
GAO, the Army signed the Contract with Ansible.
Id.
Eskridge filed a response to the Army’s request for dismis-
sal on April 6 and, on April 13, the Army issued a stop work
order to Ansible.
Id. at 417–18. On April 18, the Army
took corrective action by issuing a memorandum that indi-
cated it would “‘revise the source selection documents in
order to better document the selection and award process’
and to ‘review the evaluations of the proposals [to
comply . . . may constitute sufficient cause to justify rejec-
tion of a proposal.”
Id. § 52.222-46(d).
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6 ESKRIDGE & ASSOCIATES v. UNITED STATES
determine] if [Ansible] fully compl[ied] with’” the require-
ments of the 2018 Solicitation.
Id. at 418 (citation omitted)
(alterations in original).
In April 2018, the Army reevaluated the proposals as
set forth in its corrective action memorandum.
Id. The
Army reviewed the ten lowest-priced bidders on both tech-
nical and past performances bases.
Id. Five of the ten bid-
ders were deemed technically unacceptable.
Id. at 419.
Of
the five technically acceptable bidders, Eskridge bid the
highest total price at $18,124,729.20.
Id. Ansible’s pro-
posal bore the total price of $16,565,078.40.
Id. The Army
compared each line of the itemized proposed price against
the independent government estimate (“IGE”) to determine
if each itemized price was fair and reasonable.
Id. 4 Ansi-
ble’s proposed prices were 14 to 25 percent less than the
IGE, while Eskridge’s proposed prices were between 13
to 14 percent below the IGE.
Id. The Army awarded the
Contract to Ansible and notified the nine unsuccessful bid-
ders.
Id. at 419–20.
In August 2018, Eskridge filed a post-award protest
with the GAO, claiming the Army’s determination process
was “‘ambiguous and contrary’ to the solicitation, ‘unrea-
sonable, arbitrary, and contrary to law,’” and conducted in
bad faith, alleging the Army did not adhere to the terms
agreed upon following the 2016 Solicitation.
Id. at 420
4 The IGE was an estimate “based upon [the Army’s]
assessment of base salaries paid in the local area as well as
salaries paid on current contracts.” J.A. 170. In the 2018
Solicitation, the Army determined it would review compen-
sation as part of its technical evaluation of the proposals,
and “[a] low, or no [c]ompensation [p]lan, may be viewed as
evidence of failure to comprehend the complexity of the
contract requirements or appropriate compensation levels
for [the] geographic area where performance will take
place.” J.A. 170.
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ESKRIDGE & ASSOCIATES v. UNITED STATES 7
(internal citations omitted). Eskridge also argued that An-
sible’s bid and the other bids lower than its own were too
close to the proposal’s “minimum bid” of $15,186,441.60.
Id. In November 2018, the “GAO dismissed Eskridge’s pro-
test, finding Eskridge was not an interested party.”
Id.
at 421. Specifically, the GAO determined that Eskridge’s
arguments were “unpersuasive,” as the other three unsuc-
cessful bidders that had provided proposals with total
prices lower than Eskridge’s had “a more direct economic
interest in this procurement.”
Id. (internal quotation
marks and citation omitted). Additionally, the GAO found
unpersuasive Eskridge’s argument that the three other
bidders with “proposed prices that were in the neighbor-
hood of Ansible’s also should [be] assessed as nonrespon-
sive,” as there was less than a $200,000 difference between
Eskridge’s bid and the next lowest bid.
Id. (internal quota-
tion marks and citation omitted).
In December 2018, Eskridge filed a complaint in the
Court of Federal Claims, alleging that the “Army’s decision
to award the [C]ontract to Ansible [is] arbitrary, capricious,
or contrary to law” and requesting the Court of Federal
Claims to “issue a declaratory judgment that the Army’s
award was in violation of its own solicitation and of pro-
curement laws” and to “order the Army to award the . . .
[C]ontract to Eskridge.”
Id. at 412, 421. The Court of Fed-
eral Claims dismissed all of Eskridge’s claims.
Id. at 425.
In doing so, the Court of Federal Claims first addressed
whether Eskridge had a substantial chance of winning the
Contract and concluded that it did not.
Id. at 422–23. The
Court of Federal Claims reasoned that all five technically
acceptable bidders exceeded the minimum compensation
rate required by the Army.
Id. at 422. Second, the Court
of Federal Claims determined that, because Eskridge’s bid
was valued within $200,000 of the next lowest bid,
Eskridge’s bid would fail alongside the other four lower
bids under Eskridge’s own argument that all bids “‘in the
neighborhood’ of Ansible’s were so low as to represent a
Case: 19-1862 Document: 44 Page: 8 Filed: 04/15/2020
8 ESKRIDGE & ASSOCIATES v. UNITED STATES
facially unreasonable bid.”
Id. at 422–23. Third, the Court
of Federal Claims determined that “the claims of error
Eskridge makes in this protest focus primarily on the
Army’s alleged failure to conduct a compensation realism
analysis, which as a practical matter would affect each of
the five lowest-priced, technically acceptable proposals
equally.”
Id. at 423.
The Court of Federal Claims also addressed Eskridge’s
claim that the Army failed to incorporate terms it pledged
to include following the 2017 Protest.
Id. at 424. It con-
cluded that Eskridge waived the issue, as a timely com-
plaint would have come in a pre-award protest.
Id. The
Court of Federal Claims concluded that, in any event, the
Army fulfilled its obligations following the 2017 Protest, as
it “incorporated by reference [48 C.F.R.] § 52.222-46, which
put all [bidders] on notice that the Army intended to con-
duct an analysis of compensation realism as part of the
technical evaluation.”
Id. at 424–25. The Court of Federal
Claims dismissed the Complaint, concluding that “because
Eskridge offered the fifth highest technically acceptable
bid and its protest does not make a credible challenge to
the technical acceptability of four lower bids,” “Eskridge
cannot show a direct economic interest in the protest and
consequently is not an interested party and lacks stand-
ing.”
Id. at 425.
DISCUSSION
I. Standard of Review and Legal Standard
“Whether a party has standing to sue is a question that
[we] review de novo.” Am. Fed’n of Gov’t Emps. v. United
States,
258 F.3d 1294, 1298 (Fed. Cir. 2001) (internal quo-
tation marks and citation omitted). Section 1491 provides
that the Court of Federal Claims
shall have jurisdiction to render judgment on an
action by an interested party objecting to a solicita-
tion by a Federal agency for bids or proposals for a
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ESKRIDGE & ASSOCIATES v. UNITED STATES 9
proposed contract or to a proposed award or the
award of a contract or any alleged violation of stat-
ute or regulation in connection with a procurement
or a proposed procurement.
28 U.S.C. § 1491(b)(1) (emphasis added). The statute pro-
vides that the Court of Federal Claims shall have jurisdic-
tion over an objection brought by “an interested party,” but
does not define the term. See
id. § 1491.
We have held that the “interested party” term under
§ 1491 must be interpreted in accordance with the standing
requirements provided by the Competition in Contracting
Act (“CICA”), 31 U.S.C. §§ 3551–56. See Am.
Fed’n, 258
F.3d at 1300–02; see also Myers Investigative & Sec. Servs.,
Inc. v. United States,
275 F.3d 1366, 1370 (Fed. Cir. 2002)
(“[I]n our recent decision in American Federation, we held
that [§] 1491(b)(1) did not adopt the [Administrative Proce-
dure Act’s] liberal standing standards, and that the nar-
rower standards—consistent with the [CICA]—continued
to apply.” (internal citation omitted)). “In bid protests un-
der [§ 1491], we . . . construe the term ‘interested party’ in
[§] 1491(b)(1) in accordance with the [standing require-
ments of the] CICA and hold that standing under
§ 1491(b)(1) is limited to actual or prospective bidders or
offerors whose direct economic interest would be affected by
the award of the contract or by failure to award the con-
tract.” Myers
Investigative, 275 F.3d at 1370 (third brack-
eted addition and ellipsis in original) (emphasis added)
(internal quotation marks and citation omitted). We have
stated that “[t]o prove a direct economic interest as a puta-
tive prospective bidder, [the protestor] is required to estab-
lish that it had a ‘substantial chance’ of receiving the
contract.” Rex Serv. Corp. v. United States,
448 F.3d 1305,
1308 (Fed. Cir. 2006); see Info. Tech. & Applications Corp.
v. United States,
316 F.3d 1312, 1319 (Fed. Cir. 2003) (“To
establish prejudice, [the protestor] must show that there
was a ‘substantial chance’ it would have received the con-
tract award but for the alleged error in the procurement
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10 ESKRIDGE & ASSOCIATES v. UNITED STATES
process.” (citation omitted)); Statistica, Inc. v. Christopher,
102 F.3d 1577, 1581 (Fed. Cir. 1996) (similar).
II. Eskridge Lacks Standing to Bring a Protest
The Court of Federal Claims determined that Eskridge
lacked standing to bring a post-award protest because it
did not have a direct economic interest since it did not have
a substantial chance of receiving the Contract. See
Eskridge, 142 Fed. Cl. at 422–23. Eskridge contends that
the Court of Federal Claims erred in concluding that it did
not have a direct economic interest as it would have had a
substantial chance of winning the Contract “but for the
Army’s errors in evaluating technical acceptability.” Ap-
pellant’s Br. 18. We disagree with Eskridge.
Eskridge bid on the 2018 Solicitation, so we focus our
inquiry on whether Eskridge possesses the requisite direct
economic interest. To be an interested party, a bidder must
have a “direct economic interest [that] would be affected by
the award of the contract.”
Myers, 275 F.3d at 1370. We
conclude that Eskridge does not possess such a direct eco-
nomic interest. In a post-award bid protest, the relevant
inquiry is whether the bidder had a “substantial chance” of
winning the award—specifically, whether a protestor “es-
tablish[ed] not only some significant error in the procure-
ment process, but also that there was a substantial chance
it would have received the contract award but for that er-
ror.”
Statistica, 102 F.3d at 1582; see United States v. Int’l
Bus. Machs. Corp.,
892 F.2d 1006, 1010–11 (Fed. Cir. 1989)
(concluding that a bid protestor had “at best, a trivial in-
terest in the award” and therefore no economic interest
where, if the protest were successful, the award would go
to another party); see also Impresa Construzioni Geom. Do-
menico Garufi v. United States,
238 F.3d 1324, 1334 (Fed.
Cir. 2001) (summarizing cases). Eskridge failed to demon-
strate that it would be in line for the Contract. First, even
if Ansible was removed from the running for some reason,
the award would go to one of the other three lower-priced,
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ESKRIDGE & ASSOCIATES v. UNITED STATES 11
technically acceptable bids that ranked before Eskridge,
and Eskridge still would not have a substantial chance of
winning the award. See
Eskridge, 142 Fed. Cl. at 424 (ex-
plaining that there were three lower-priced, technically ac-
ceptable bids between Ansible’s and Eskridge’s bids); see
also Int’l Bus.
Machs., 892 F.2d at 1010–11 (finding no di-
rect economic interest where there is a lower-priced, tech-
nically acceptable bid). 5
Second, Eskridge fails to allege prejudice sufficient to
require the Contract to be rebid, which would have allowed
Eskridge to compete again. A bidder has an economic in-
terest and therefore standing to challenge a contract award
where, “if the [bidder’s] bid protest were allowed because of
an arbitrary and capricious responsibility determination
by the contracting officer, the government would be obli-
gated to rebid the contract, and [the bidder] could compete
for the contract once again.”
Impresa, 238 F.3d at 1334.
Outside of its contention that the Army failed to conduct a
compensation realism analysis, Eskridge does not allege al-
ternate grounds which, if true, would require rebidding.
See generally Appellant’s Br. Cf. Info.
Tech., 316 F.3d
at 1319 (determining that a disappointed bidder estab-
lished the requisite prejudice for standing, as the party was
a qualified bidder whose proposal met minimum contract
requirements and “its chances of securing the contract in-
creased if the problem [alleged] . . . was cured”).
Eskridge’s counterarguments are unavailing.
Eskridge contends that it would have a chance of being
awarded the Contract, because its challenge encompasses
5 To the extent that Eskridge is protesting the terms
of the 2018 Solicitation, such a challenge is untimely. See
Blue & Gold Fleet, L.P. v. United States,
492 F.3d 1308,
1313 (Fed. Cir. 2007) (holding that a party waives the abil-
ity to object to the terms of a solicitation if it fails to do so
before the close of the bidding process).
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12 ESKRIDGE & ASSOCIATES v. UNITED STATES
all four lower-priced bidders due to the Army’s improper
determination that they were technically acceptable when
they were in fact deficient. See Appellant’s Br. 18 (“[T]he
Army committed substantial errors by failing to adhere to
evaluation criteria pertaining to retention and recruiting
of CRNAs,” “which allowed four bidders to submit wage
rates and pricing wholly inadequate to retain and recruit
CRNAs in the latter option years of the contract[.]”). Spe-
cifically, Eskridge asserts—notably without providing rec-
ord support—that the 2018 Solicitation required that
“wage rates must increase proportionally per option year
at a percentage necessary to maintain and sustain the
workforce throughout the life of the contract.”
Id. at 19.
This argument fails, hinging on a faulty premise: For
Eskridge’s argument to prevail, the 2016 Solicitation’s
price realism analysis requirement—which Eskridge sug-
gests would engender the need for proportional and annual
wage increases—must have been imputed into the 2018 So-
licitation. It was not incorporated. The Army specified
that in the 2018 Solicitation, it had removed the 2016 So-
licitation’s price realism analysis requirement and, in its
place, added the minimum compensation rate requirement.
See
Eskridge, 142 Fed. Cl. at 414 (“[T]he Army made th[e]
[minimum compensation rate] addition because the prior
iteration of this procurement—unlike the current one—in-
corporated price realism in a best value trade-off analy-
sis.”); see J.A. 171 (2018 Solicitation) (setting the initial
“minimum acceptable provider wage rate” at $113.84 (cap-
italization altered)), 159–72 (2018 Solicitation) (providing
for no annual wage increase in option years). All four of
the lower-priced bids met the compensation rate require-
ment, see
Eskridge, 142 Fed. Cl. at 414–15; see also
J.A. 861–65, and so the Court of Federal Claims did not err
in determining the bids were technically acceptable on that
basis, see Int’l Bus.
Machs., 892 F.2d at 1011 (explaining
that, where every bidder “offers essentially the same
[bid,] . . . materially differ[ing] only as to price, the
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ESKRIDGE & ASSOCIATES v. UNITED STATES 13
solicitation itself is not challenged, and there is no reason
to believe that the second-lowest bid is not responsive, only
the second-lowest bidder has a direct economic interest”).
Similarly, Eskridge’s claim that the Army erred by rat-
ing the four lower bidders as technically acceptable—de-
spite their offering of wage rates that “fall[] below the
median rate established by the IGE” for two option years—
is flawed. Appellant’s Br. 21. The compensation realism
analysis specified in the 2018 Solicitation requires the
Army to measure each bid’s price against the minimum
hourly rate provided for, which the Army did. See
Eskridge, 142 Fed. Cl. at 422. In contrast, the IGE analysis
is used to determine whether each bidder’s pricing was
“[f]air and reasonable.”
Id. at 419 (citation omitted); see
J.A. 859 (2018 Solicitation Source Selection Decision Doc-
ument) (“Fair and reasonable pricing can be determined by
comparison to the [IGE].”). Compensation realism analysis
evaluates whether a proposed compensation is too low,
Eskridge, 142 Fed. Cl. at 423, while the fair and reasonable
analysis determines if it is too high. See Triad Int’l Maint.
Corp., B-408374,
2013 WL 4854436, at *7 (Comp. Gen.
Sept. 5, 2013) (citing Milani Constr., LLC, B-401942, 2010
CPD ¶ 87 at 4 (Comp. Gen. Dec. 22, 2009)). For the reasons
stated above, the Army did not err in its compensation re-
alism analysis. Accordingly, because Eskridge failed to
demonstrate a direct interest, it does not have standing to
protest.
CONCLUSION
We have considered Eskridge’s remaining arguments
and find them unpersuasive. Accordingly, the Judgment of
the U.S. Court of Federal Claims is
AFFIRMED
