Inserso Corp. v. United States ( 2020 )

Case: 19-1933 Document: 51 Page: 1 Filed: 06/15/2020
United States Court of Appeals
for the Federal Circuit
______________________
INSERSO CORPORATION,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
FEDITC, LLC, RIVERSIDE ENGINEERING, LLC,
Defendants
______________________
2019-1933
______________________
Appeal from the United States Court of Federal Claims
in No. 1:18-cv-01655-LAS, Senior Judge Loren A. Smith.
______________________
Decided: June 15, 2020
______________________
RICHARD P. RECTOR, DLA Piper LLP (US), Washington,
DC, for plaintiff-appellant. Also represented by DAWN
STERN; CARL BRADFORD JORGENSEN, Austin, TX.
ANTHONY F. SCHIAVETTI, Commercial Litigation
Branch, Civil Division, United States Department of Jus-
tice, Washington, DC, for defendant-appellee. Also repre-
sented by JOSEPH H. HUNT, ROBERT EDWARD KIRSCHMAN,
JR., DOUGLAS K. MICKLE.
______________________
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2 INSERSO CORP. v. UNITED STATES
Before REYNA, MAYER, and TARANTO, Circuit Judges.
Opinion for the court filed by Circuit Judge TARANTO.
Dissenting opinion filed by Circuit Judge REYNA.
TARANTO, Circuit Judge.
The United States Defense Information Systems
Agency (DISA), which is part of the U.S. Department of De-
fense, awarded contracts to multiple firms that bid for the
opportunity to sell information technology services to vari-
ous federal government agencies. Inserso Corporation un-
successfully competed to be one of the firms awarded a
contract. In an action filed against the United States in
the Court of Federal Claims, Inserso alleged that DISA dis-
closed information to certain other bidders but not Inserso,
giving the rival bidders an unfair competitive advantage.
The Court of Federal Claims held that DISA’s disclosure
did not prejudice Inserso in the competition and on that
basis entered judgment in favor of the government. Inserso
Corp. v. United States, 142 Fed. Cl. 678 (2019).
We agree that judgment in favor of the government is
appropriate, but on a different ground. We conclude that,
because Inserso did not object to the solicitation when it
was unreasonable to disregard the high likelihood of the
disclosure at issue, Inserso forfeited its ability to challenge
the solicitation in the Court of Federal Claims. We do not
reach the prejudice portion of the court’s decision. We
therefore vacate that decision and remand for the court to
enter judgment consistent with this opinion.
I
On March 2, 2016, DISA publicly posted Solicitation
No. HC1028-15-R-0030 (Encore III). The solicitation in-
vited firms to bid for the opportunity to enter into indefi-
nite-delivery/indefinite-quantity contracts under which the
awardees would provide information-technology services to
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INSERSO CORP. v. UNITED STATES 3
the Department of Defense and other federal agencies. The
solicitation states that the contracts would involve fixed-
price and cost-reimbursement task orders and that awards
of contracts would be made to offerors whose proposals pro-
vided the best value to the government and satisfied the
evaluation criteria.
The solicitation lists three criteria for evaluating pro-
posals: (1) the bidder’s technical/management approach,
(2) the bidder’s past performance, and (3) cost/price infor-
mation. For the evaluation of price, the solicitation states,
DISA would calculate a “total proposed price” and a “total
evaluated price.” J.A. 101918. The total proposed price
would be calculated by applying government-estimated la-
bor hours for each year of contract performance to each of-
feror’s proposed fixed-price and cost-reimbursement labor
rates; in turn, the total evaluated price would be calculated
by adjusting any cost-reimbursement rates that DISA de-
termined were unrealistic. The proposals with the lowest
total evaluated price would then be evaluated for compli-
ance with the other terms of the solicitation.
DISA divided the Encore III competition into two com-
petitions. One competition would award a “suite” of con-
tracts in a “full and open” competition; the other would
award a suite of contracts to small businesses. J.A. 101891.
DISA anticipated awarding up to twenty contracts in each
competition.
Importantly, the solicitation expressly states that
small businesses could compete in both competitions but
could receive only one award. J.A. 101892. The solicitation
also provides that firms could compete through joint ven-
tures or partnerships. J.A. 101907. Under those provi-
sions, several firms that bid in the small-business
competition in fact also competed in the full-and-open com-
petition as part of joint ventures. Inserso competed only in
the small-business competition.
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4 INSERSO CORP. v. UNITED STATES
Bidders in both competitions submitted their proposals
by October 21, 2016. But the timing of the two competi-
tions quickly diverged. On November 2, 2017, DISA noti-
fied successful and unsuccessful bidders in the full-and-
open competition of their award status. By November 8,
2017, i.e., less than a week later, DISA completed the de-
briefing process by which it discloses certain details of the
agency’s selection decision to winners and losers. See 48
C.F.R. § 15.506.
DISA had not yet completed evaluating the proposals
submitted in the separate small-business competition and
was still communicating with bidders in that competition.
By October 18, 2017, DISA had received responses to the
first round of evaluation notices it had sent to small-busi-
ness bidders. Even after November 2, 2017, DISA sent sev-
eral more rounds of evaluation notices to small-business
bidders. DISA did not request final proposal revisions from
the small-business bidders until April 2018. See 48 C.F.R.
§ 15.307. Ultimately, such bidders had until June 20, 2018,
to submit their final revised proposals for the small-busi-
ness competition.
DISA notified successful and unsuccessful bidders of
its award decisions for the small-business suite on Septem-
ber 7, 2018. Inserso did not receive an award because its
total evaluated price was the 23rd lowest in a competition
for twenty slots. DISA attached a debriefing document to
its notice to Inserso. The debriefing included—among
other things—the total evaluated price for the twenty
awardees and some previously undisclosed information on
how DISA had evaluated the cost element of the proposals.
In response to its debriefing, Inserso sent follow-up
communications to DISA. Inserso noted that several
awardees in the small-business competition had also com-
peted in the full-and-open competition as part of joint ven-
tures or partnerships, and it asked whether those entities
had received similarly detailed debriefings at the
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INSERSO CORP. v. UNITED STATES 5
conclusion of the full-and-open competition (in fall 2017).
Inserso expressed concern that, if so, the earlier debriefing
would have provided unequal information giving a compet-
itive advantage to some of the bidders in the pending small-
business competition. In response, DISA stated that all
unsuccessful bidders in both competitions were given sim-
ilarly detailed information in their debriefings.
On September 12, 2018, Inserso filed a protest in the
United States Government Accountability Office (GAO).
See 4 C.F.R. §§ 21.1–21.2. On October 17, 2018, GAO dis-
missed Inserso’s protest because another party was chal-
lenging the same solicitation at the Court of Federal
Claims. See id., § 21.11(b).
On October 25, 2018, Inserso filed its own complaint in
the Court of Federal Claims, alleging that the full-and-
open debriefing gave certain offerors in the small-business
competition a competitive advantage by providing them,
but not other bidders, the total evaluated price for all full-
and-open awardees and previously undisclosed infor-
mation regarding DISA’s evaluation methodology. Inserso
alleged that this unequal provision of information created
an organizational conflict of interest in violation of 48
C.F.R. §§ 9.504, 9.505 and, in addition, violated at least one
regulation specifically addressed to disparate treatment of
bidders, 48 C.F.R. § 1.602-2(b). Inserso moved for judg-
ment on the administrative record, and the government op-
posed Inserso’s motion and cross-moved for judgment on
the administrative record.
The Court of Federal Claims ruled in favor of the gov-
ernment. Without definitively finding a violation, the court
recognized that the challenged disclosure of information
might have violated the identified regulatory standards,
stating in particular that the total evaluated prices of the
winners of the full-and-open competition “provided a useful
comparison tool that [small-business-competition] offerors
could utilize as a benchmark in revising their price
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6 INSERSO CORP. v. UNITED STATES
proposals.” Inserso, 142 Fed. Cl. at 684. The court also
stated that “[p]rejudice is presumed once a potentially sig-
nificant [organizational conflict of interest] is identified.”
Id. Here, however, the court concluded, the government
demonstrated lack of prejudice to Inserso, a conclusion that
defeated Inserso’s claim as to both sets of regulations at
issue. Id. at 684–85. The court entered judgment on
April 2, 2019. J.A. 6.
Inserso timely appealed. We have jurisdiction under
28 U.S.C. § 1295(a)(3).
II
On appeal, Inserso argues that the Court of Federal
Claims erred in its treatment of the presumption of preju-
dice, including in its determination that the government
rebutted such a presumption. Inserso also argues that,
even apart from a presumption of prejudice, it was entitled
to a finding that it was prejudiced by the challenged une-
qual disclosure. The government—in addition to defending
the trial court’s analysis—argues in this court, as it did in
the trial court, that Inserso forfeited its right to challenge
DISA’s disclosure by not raising the issue in a timely man-
ner.
Under 28 U.S.C. § 1491(b), the Court of Federal Claims
has “jurisdiction to render judgment on an action by an in-
terested party objecting to” a solicitation or contract award
made by a federal agency. We review the Court of Federal
Claims’ legal conclusions de novo and its factual findings
for clear error. Daewoo Eng’g & Constr. Co. v. United
States, 557 F.3d 1332, 1335 (Fed. Cir. 2009). “When mak-
ing a prejudice analysis in the first instance, [the Court of
Federal Claims] is required to make factual findings.”
Bannum, Inc. v. United States, 404 F.3d 1346,1357 (Fed.
Cir. 2005). Whether the court applied the appropriate legal
standard to its factual findings is a question of law. See
Shell Oil Co. v. United States, 688 F.3d 1376, 1381
(Fed. Cir. 2012).
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INSERSO CORP. v. UNITED STATES 7
A
Inserso alleges that DISA violated two sets of regula-
tions that are part of the Federal Acquisition Regulation
(FAR). First, it alleges that DISA violated FAR subpart
9.5, which directs contracting officers to avoid, neutralize,
or mitigate “organizational conflicts of interest.” 48 C.F.R.
§ 9.505. Section 9.505 describes the dual aims of
“[p]reventing the existence of conflicting roles that might
bias a contractor’s judgment” and “[p]reventing unfair com-
petitive advantage.” Id., § 9.505(a), (b). An unfair compet-
itive advantage can exist when a contractor possesses
“[p]roprietary information that was obtained from a Gov-
ernment official without proper authorization” or “[s]ource
selection information (as defined in [48 C.F.R. §] 2.101)
that is relevant to the contract but is not available to all
competitors, and such information would assist that con-
tractor in obtaining the contract.” Id., § 9.505(b). Second,
Inserso alleges that DISA failed to treat it fairly and
equally, as required by several provisions of the FAR. See,
e.g., id., §§ 1.102(b)(3), 1.602-2(b), 3.101-1.
Both of Inserso’s regulatory arguments arise from the
same underlying DISA action, having the same alleged
wrongful effect on the small-business competition. Specif-
ically, both arguments challenge the disclosure of certain
information to firms that (directly or through partnerships
or joint ventures) bid for the full-and-open suite of con-
tracts when some of those firms (directly or through part-
nerships or joint ventures) were still preparing bids for the
small-business suite. Because “the scope of work and eval-
uation factors are nearly identical for each suite,” Inserso,
142 Fed. Cl. at 684, and the information was relevant to
the evaluation of bids, Inserso alleges, DISA’s failure to dis-
close that same information to all bidders in the small-busi-
ness competition gave those bidders with the information
an unfair competitive advantage.
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8 INSERSO CORP. v. UNITED STATES
Inserso focuses on two categories of disclosed infor-
mation: (1) the total evaluated prices of those firms which
won contracts in the full-and-open competition; and (2) de-
tails of how DISA evaluated the costs built into the pro-
posals made by bidders in that competition. Inserso
contends, and the trial court recognized, that knowledge of
the winning total evaluated prices from the full-and-open
competition would provide a small-business-competition
bidder a target range in which it could be confident that it
would win an award. Inserso also contends that the cost-
evaluation information would have been useful to a small-
business-competition bidder who was considering how to
reduce the price of its bid in a way that DISA would find
acceptable.
Inserso, however, did not object to the disparity in pro-
vision of competitively advantageous information until af-
ter the awards were made in the small-business
competition. We conclude that, by waiting until the awards
were made, Inserso forfeited the objection.
B
In Blue & Gold Fleet, L.P. v. United States, we held that
“a party who has the opportunity to object to the terms of a
government solicitation containing a patent error and fails
to do so prior to the close of the bidding process waives its
ability to raise the same objection subsequently in a bid
protest action in the Court of Federal Claims.” 492 F.3d
1308, 1313 (Fed. Cir. 2007). We have since held that this
reasoning “applies to all situations in which the protesting
party had the opportunity to challenge a solicitation before
the award and failed to do so.” COMINT Systems Corp. v.
United States, 700 F.3d 1377, 1382 (Fed. Cir. 2012). The
Court of Federal Claims has correctly applied this rule in
organizational-conflict-of-interest cases, including cases
dealing with the disclosure of pricing information during
debriefing. See Ceres Envtl. Services, Inc. v. United States,
97 Fed. Cl. 277, 310 (2011).
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INSERSO CORP. v. UNITED STATES 9
A defect in a solicitation is patent if it is an obvious
omission, inconsistency, or discrepancy of significance. Per
Aarsleff A/S v. United States, 829 F.3d 1303, 1312
(Fed. Cir. 2016). Additionally, a defect is patent if it could
have been discovered by reasonable and customary care.
Id. at 1313; see also K-Con, Inc. v. Secretary of Army, 908
F.3d 719, 722 (Fed. Cir. 2018) (“A patent ambiguity is pre-
sent when the contract contains facially inconsistent provi-
sions that would place a reasonable contractor on notice.”).
“Whether an ambiguity or defect is patent is an issue of law
reviewed de novo.” Per Aarsleff, 829 F.3d at 1312. 1
1 The dissent, but not Inserso, suggests that this
court’s Blue & Gold line of authority has been superseded
by the Supreme Court’s decision in SCA Hygiene Products
Aktiebolag v. First Quality Baby Products, LLC, 137 S. Ct.
954 (2017). We do not read SCA Hygiene as having the
broad implication that the dissent suggests but rather as
holding only that the general non-statutory equitable time-
liness doctrine of laches does not override the congression-
ally enacted statute of limitations applicable to legal
actions for damages. 137 S. Ct. at 959–67. Blue & Gold,
in contrast, establishes a “waiver rule” under a specific
statutory authorization—the congressional command that
bid-protest jurisdiction under 28 U.S.C. § 1491(b) be exer-
cised with “due regard to the . . . need for expeditious reso-
lution of the action,” 28 U.S.C. § 1491(b)(3)—with support
from longstanding substantive contract law and from reg-
ulations under a related statutory regime specific to bid
protests. See Blue & Gold, 492 F.3d at 1313–14 (discussing
“patent ambiguity” and “contra proferentem” doctrines and
General Accountability Office regulations).
The dissent also suggests that we refrain from ruling
on the Blue & Gold issue. But Inserso does not dispute that
the issue was raised in the trial court, and it is an issue of
law that we see no impediment to resolving ourselves.
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10 INSERSO CORP. v. UNITED STATES
C
Those principles defeat Inserso’s claims. Inserso
should have challenged the solicitation before the competi-
tion concluded because it knew, or should have known, that
DISA would disclose information to the bidders in the full-
and-open competition at the time of, and shortly after, the
notification of awards. Inserso knew that the Encore III
solicitation process was divided into two competitions and
that small businesses could compete for both suites, either
individually or as part of a joint venture or partnership.
J.A. 101907. It is undisputed that Inserso knew that the
full-and-open competition had been completed in Novem-
ber 2017. See Appellee Br. 41; see also Encore III Full &
Open, Sam.gov, https://beta.sam.gov/opp/96e2d2943ebc
322905ebf27cf711e158/view#award (noting that contract
award was originally published Nov. 7, 2017).
The FAR indicates that the winning total evaluated
prices would have been provided to all unsuccessful offe-
rors in the competitive range within three days of the
award. 48 C.F.R. § 15.503(b)(1)(iv) (“Within 3 days after
the date of contract award, the contracting officer shall pro-
vide written notification to each offeror whose proposal was
in the competitive range but was not selected for award
. . . . The notice shall include . . . [t]he items, quantities,
and any stated unit prices of each award. If the number of
items or other factors makes listing any stated unit prices
impracticable at that time, only the total contract price need
be furnished in the notice.”) (emphasis added). And DISA
in fact included the awardees’ total evaluated prices in its
notifications to unsuccessful full-and-open offerors. See,
e.g., J.A. 186838–39.
Offerors in a government solicitation are “charged with
knowledge of law and fact appropriate to the subject mat-
ter.” Per Aarsleff, 829 F.3d at 1314 (citing Turner Con-
struction Co. v. United States, 367 F.3d 1319, 1321
(Fed. Cir. 2004)). Here, that knowledge includes knowing
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INSERSO CORP. v. UNITED STATES 11
that the total evaluated prices would be disclosed to bid-
ders in the full-and-open competition at or shortly after the
announcement of the awards in that competition. It also
includes knowing that the express terms of the solicitation
contemplated overlap of bidders in the two competitions
(directly or through partnerships or joint ventures), so that
Inserso, if it had taken reasonable care, would have known
that recipients of the information at issue could include
bidders in the small-business competition. The law and
facts made patent that the solicitation allowed, and that
there was likely to occur, the unequal disclosure regarding
prices that Inserso now challenges.
We reach a similar conclusion about the information
regarding DISA’s evaluation methodology that Inserso al-
leges would have provided a competitive advantage to bid-
ders in the small-business competition. Although the FAR
does not require disclosing such information in the award
notice, Inserso should have known that disclosure of this
information was likely to be a part of the competitively val-
uable information required by the FAR to be included in
the post-award debriefing. For example, post-award de-
briefings must include, at a minimum, “[t]he Government’s
evaluation of the significant weaknesses or deficiencies in
the offeror’s proposal”, “[t]he overall evaluated cost or price
. . . , and technical rating, if applicable, of the successful
offeror and the debriefed offeror,” “[t]he overall ranking of
all offerors,” and “[a] summary of the rationale for award.”
48 C.F.R. § 15.506(d). Although it may have been impossi-
ble to know the precise contents of the full-and-open com-
petition’s debriefings, Inserso should have known that
those debriefings were bound to contain information that
would provide a competitive advantage in the small-busi-
ness competition, including the “overall evaluated cost or
price” of the successful offerors. Id., § 15.506(d)(2).
In response to the government’s forfeiture argument,
Inserso argues that it could not have known that DISA
would debrief the bidders in the full-and-open competition
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12 INSERSO CORP. v. UNITED STATES
while the small-business offerors were still revising their
proposals. Appellant’s Reply Br. 29–30. Inserso points out
that the regulations do not set a strict time limit on debrief-
ing; rather, they require only that “[t]o the maximum ex-
tent practicable, the debriefing should occur within 5 days”
after an offeror requests debriefing. 48 C.F.R.
§ 15.506(a)(2). Therefore, Inserso argues, DISA should not
have conducted the debriefing for the full-and-open compe-
tition before the small-business competition closed.
We do not think it reasonable for Inserso to have be-
lieved that DISA would delay—for three quarters of a
year—the post-award debriefing of the bidders in the full-
and-open competition. The debriefing process is an im-
portant part of the award process, and the expressly stated
baseline rule of five days demonstrates the very short time
scale understood to be important. The “practicable” quali-
fier gives some flexibility: one treatise notes that when
there are many offerors, debriefing may not be completed
for weeks. Government Contract Bid Protests: A Practical
& Procedural Guide § 2:11. But no evidence or authority
presented to us suggests that the “practicable” qualifier
has been used, or could be reasonably counted on by In-
serso to be used, to delay debriefing for many months. Nor
could Inserso reasonably rely on DISA to decide to delay
the debriefing based on a possibility of unequal advantage
in the small-business competition where nobody had called
the issue to its attention. The Blue & Gold forfeiture stand-
ard exists in recognition of the need for interested bidders
to call the agency’s attention to solicitation problems of
which they reasonably should be aware.
Moreover, Inserso should have known that DISA had
debriefed the bidders in the full-and-open competition once
the GAO publicly dismissed a post-award protest of the
awards in that competition. GAO’s regulations specify that
for “a procurement conducted on the basis of competitive
proposals under which a debriefing is requested . . . , the
initial protest shall not be filed before the debriefing date
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INSERSO CORP. v. UNITED STATES 13
offered to the protestor, but shall be filed not later than 10
days after the date on which the debriefing was held.” 4
C.F.R. § 21.2(a)(2) (emphasis added). On February 21,
2018, GAO dismissed a post-award bid protest challenging
DISA’s awards in the full-and-open competition. Planned
Systems Int’l, Inc. B-413028.5, 2018 WL 1898124 (Comp.
Gen. Feb. 21, 2018). Inserso should have known, from the
existence of a relevant protest at GAO, that the bidders in
the full-and-open competition had been debriefed. Indeed,
the GAO decision states as much. Id. at *3. The decision
is not subject to a protective order, and there is no indica-
tion that it would not have been publicly available on the
day it issued. Therefore, Inserso is properly charged with
knowing, on or shortly after February 21, 2018, that the
bidders in the full-and-open competition had been de-
briefed. 2
Because a bidder in the small-business competition ex-
ercising reasonable and customary care would have been
on notice of the now-alleged defect in the solicitation long
before the awards were made, Inserso forfeited its right to
raise its challenge by waiting until awards were made.
Whether starting from the November 2017 award in the
full-and-open competition or from the February 2018 GAO
denial of a protest in that competition, Inserso had months
to notify DISA of this defect before it submitted its final
revised proposals. J.A. 178905. It had an additional two
2 The dissent cites a solicitation provision that
states: “The estimated labor hours used for evaluation pur-
poses will not be provided to the offerors until after award.”
J.A. 101918. That provision does not generally negate the
expected normal operation of the debriefing process in the
full-and-open competition. It applies only to estimated la-
bor hours—thereby highlighting the obviousness of the de-
fect by omitting mention of any other competitively
advantageous information.
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14 INSERSO CORP. v. UNITED STATES
months before DISA selected the small-business awardees.
J.A. 179528. Our previous cases establish that this amount
of time is more than sufficient. See COMINT, 700 F.3d at
1383 (“Here, Comint had two and a half months between
the issuance of Amendment 5 and the award of the contract
in which to file its protest. That was more than an ade-
quate opportunity to object.”).
D
Enforcing our forfeiture rule implements Congress’s di-
rective that courts “shall give due regard to . . . the need for
expeditious resolution” of protest claims. 28 U.S.C.
§ 1491(b)(3). The rule serves the interest in “reducing the
need for the inefficient and costly process of agency rebid-
ding after offerors and the agency have expended consider-
able time and effort submitting or evaluating proposals in
response to a defective solicitation.” Bannum, Inc. v.
United States, 779 F.3d 1376, 1381 (Fed. Cir. 2015) (quot-
ing Blue & Gold, 492 F.3d at 1314) (quotation marks and
brackets omitted); see also Per Aarsleff, 829 F.3d at 1317
(Reyna, J. concurring).
The policy behind the forfeiture rule is served in this
case. In its suit in the Court of Federal Claims, Inserso
asked the court to provide all bidders in the small-business
competition access to the unequally disclosed information
and to reopen the competition to accept revised proposals.
Had Inserso objected to the solicitation before the submis-
sion of final proposals, raising its concern that some bid-
ders might have received information by participating in
the full-and-open competition, DISA could have confirmed
that an unequal disclosure occurred and provided the non-
proprietary debriefing information to all bidders in the
small-business competition. Cf. 48 C.F.R. § 15.507. In-
serso is now seeking the relief it could have gotten from
DISA earlier, before DISA had already expended consider-
able time and effort evaluating the bidders’ proposals. In-
serso has forfeited its right to this relief.
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INSERSO CORP. v. UNITED STATES 15
III
The Court of Federal Claims entered judgment on the
administrative record “pursuant to the court’s Opinion and
Order, filed April 1, 2019.” J.A. 6. Because the cited Opin-
ion and Order relied on the determination that Inserso was
not prejudiced by DISA’s disclosure—an issue we do not
reach—we think it appropriate to vacate the judgment and
remand for entry of judgment on the ground of waiver, con-
sistent with this opinion.
The parties shall bear their own costs.
VACATED AND REMANDED
Case: 19-1933 Document: 51 Page: 16 Filed: 06/15/2020
United States Court of Appeals
for the Federal Circuit
______________________
INSERSO CORPORATION,
Plaintiff-Appellant
v.
UNITED STATES,
Defendant-Appellee
FEDITC, LLC, RIVERSIDE ENGINEERING, LLC,
Defendants
______________________
2019-1933
______________________
Appeal from the United States Court of Federal Claims
in No. 1:18-cv-01655-LAS, Senior Judge Loren A. Smith.
______________________
REYNA, Circuit Judge, dissenting.
The majority decides that appellant’s claims are barred
under the Blue & Gold “waiver rule.” This decision rests
on shaky, legal ground and cannot stand. First, the
validity of the Blue & Gold “waiver rule” is undermined by
the reasoning in SCA Hygiene Products Aktiebolag v. First
Quality Baby Products, LLC, 137 S. Ct. 954 (2017).
Second, the undermined Blue & Gold “waiver rule” does
not apply to appellant’s claims, which arise from latent
errors not apparent from the solicitation. Third, the
majority decides to bar appellant’s claims under the Blue
& Gold “waiver rule” in the first instance. We should not
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2 INSERSO CORP. v. UNITED STATES
engage in such overreach given that the parties did not
brief, and the Claims Court did not discuss, the interplay
between Blue & Gold and SCA Hygiene. I respectfully
dissent.
I
First, the majority’s opinion turns on the so-called Blue
& Gold “waiver rule,” a hard-and-fast rule that this court
created. This rule runs afoul of the separation of powers
principle articulated in SCA Hygiene Products Aktiebolag
v. First Quality Baby Products, LLC, 137 S. Ct. 954, and for
this and other reasons should not be the deciding factor in
this case.
In Blue & Gold, we created a “waiver rule” for claims
filed at the United States Court of Federal Claims (“Claims
Court”) challenging a patent error in a solicitation for a
government contract. Blue & Gold Fleet, L.P. v. United
States, 492 F.3d 1308, 1315 (Fed. Cir. 2007). Although we
called it a “waiver rule,” this is a misnomer. Waiver is an
equitable defense, the application of which is left to the
trial court’s discretion. Qualcomm Inc. v. Broadcom Corp.,
548 F.3d 1004, 1019 (Fed. Cir. 2008). To prove waiver, the
defendant must show that the plaintiff intentionally
relinquished its right. Johnson v. Zerbst, 304 U.S. 458, 464
(1938). Given the draconian effect of waiver, “[t]he
determination of whether there has been an intelligent
waiver of right . . . must depend, in each case, upon the
particular facts and circumstances surrounding that case.”
Id. The Blue & Gold waiver rule does not fit this definition.
A court applying this rule gives no regard to the protestor’s
intent and is afforded no discretion in its application.
These are not the marks of true waiver.
Rather, the Blue & Gold “waiver rule,” in theory and in
practice, is a judicially-created time bar. See Per Aarsleff
A/S v. United States, 829 F.3d 1303, 1316–17 (Fed. Cir.
2016) (Reyna J., concurring) (noting that under the Blue &
Gold “timeliness bar” “[d]ismissal is mandatory, not
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INSERSO CORP. v. UNITED STATES 3
discretionary” (internal citations omitted)); see also
Bannum, Inc. v. United States, 779 F.3d 1376, 1381 (Fed.
Cir. 2015); Contract Servs., Inc. v. United States, 104 Fed.
Cl. 261, 273 (2012); Unisys Corp. v. United States, 89 Fed.
Cl. 126, 137 (2009). The bar is triggered solely by the
timing of a protestor’s challenge. Specifically, if a protestor
files a claim challenging a patent error in a solicitation
prior to the close of the bidding process, the protestor’s
claim is deemed timely. Blue & Gold, 492 F.3d at 1313. If,
however, the protestor files such a claim after the close of
bidding, without having previously objected to such an
error, the protestor’s claim is untimely and will be
dismissed. Id. at 1315; Bannum, 779 F.3d at 1380; see Maj.
Op. at 8. There are no exceptions to this rule; its
application is hard and fast. See Per Aarsleff, 829 F.3d at
1316. 1 The Blue & Gold “waiver rule” therefore poses as a
rule of equitable waiver but is in fact a timeliness rule.
1 In creating the “waiver rule,” this court relied on
various analogous timeliness doctrines. First, we noted
that our rule virtually tracks the “timeliness regulation”
for bid protests filed before the Government Accountability
Office (“GAO”), a federal agency which adjudicates bid
protests. Blue & Gold, 492 F.3d at 1314. The GAO’s
timeliness rule is a self-imposed filing deadline for bid
protests, functioning much like a statute of limitations.
See 4 C.F.R. § 21.2(a).
We also found support in A.C. Aukerman Co. v. R.L.
Chaides Constr. Co., 960 F.2d 1020 (Fed. Cir. 1992), a
patent case where we relied on the equitable doctrines of
laches and estoppel to bar relief, and in a long line of
Claims Court cases applying the defense of laches. Blue &
Gold, 492 F.3d at 1314–15. Notably, SCA Hygiene
abrogated Aukerman. See SCA Hygiene, 137 S. Ct. at 967.
Also, the Claims Court no longer applies laches to bar bid
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4 INSERSO CORP. v. UNITED STATES
In SCA Hygiene, the Supreme Court clarified that:
“[w]hen Congress enacts a statute of limitations, it speaks
directly to the issue of timeliness and provides a rule for
determining whether a claim is timely enough to permit
relief.” SCA Hygiene, 137 S. Ct. at 960 (emphasis added).
Specifically, the Supreme Court “stressed” that “courts are
not at liberty to jettison Congress’ judgment on the
timeliness of suit,” even if the statute of limitations gives
rise to “undesirable” “policy outcomes.” Id. at 960, 961 n.4
(internal quotation marks omitted) (emphasis added).
Relying on this principle, the Supreme Court held that a
court cannot rely on the doctrine of laches, an equitable
doctrine primarily focused on the timelines of a claim, to
preclude a claim for damages incurred within the Patent
Act’s statute of limitations. Id. at 967; see also Petrella v.
Metro-Goldwyn-Mayer, Inc., 572 U.S. 663, 685 (2014) (“For
laches, timeliness is the essential element.”). Yet this is
precisely what we are doing in this case.
The Supreme Court rejected the same concern we
articulated as the driving force in Blue & Gold—that a
plaintiff could sit on its rights to the detriment of the
defendant—as justification for a timeliness rule distinct
and separate from a statute of limitations. In SCA
Hygiene, the dissent argued that laches filled a “gap” in the
statute of limitations which allowed patentees to “wait
until an infringing product has become successful before
suing for infringement.” SCA Hygiene, 137 S. Ct. at 961
n.4. The Supreme Court explained that such argument
“implies that, insofar as the lack of a laches defense could
produce policy outcomes judges deem undesirable, there is
a ‘gap’ for laches to fill, notwithstanding the presence of a
statute of limitations.” Id. The Supreme Court explained
such gap-filling is “precisely the kind of legislation-
protests in light of SCA Hygiene. See, e.g., ATSC Aviation,
LLC v. United States, 141 Fed. Cl. 670, 696 (2019).
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INSERSO CORP. v. UNITED STATES 5
overriding judicial role” a court cannot take on. Id.
(internal quotation marks omitted). Yet, in the face of this
admonition, this court once again assumes such a
legislative role.
Key here, and not discussed in Blue & Gold, is that
Congress has spoken to the timeliness of challenges to
patent errors in the solicitation. Congress provided that
“[e]very claim of which the United States Court of Federal
Claims has jurisdiction,” which includes challenges to
patent errors in the solicitation, “shall be barred unless the
petition thereon is filed within six years after such claim
first accrues.” 28 U.S.C. § 2501 (emphasis added); see also
28 U.S.C. § 1491(b)(1); L-3 Commc’ns Integrated Sys., L.P.
v. United States, 79 Fed. Cl. 453, 460–61 (2007) (applying
the six-year statute of limitations to bid protest claims).
Congress also provided that the Claims Court has
jurisdiction over solicitation challenges “without regard to
whether suit is instituted before or after the contract is
awarded.” 28 U.S.C. § 1491(b)(1) (emphasis added). Given
this clear congressional directive, we cannot curtail the six-
year limitations period for challenges to patently defective
solicitations. See SCA Hygiene, 137 S. Ct. at 967. Thus,
the Blue & Gold time bar directly conflicts with the
reasoning in SCA Hygiene.
Additionally, our interest in reducing costly after-the-
fact litigation and procurement delays does not save the
Blue & Gold time bar from SCA Hygiene’s reach. We
cannot override the Claims Court’s six-year statute of
limitations based on our own policy concerns. Id. (“[W]e
cannot overrule Congress’s judgment based on our own
policy views.”). To do so is to challenge policy judgments
made by Congress in enacting the six-year statute of
limitations. Petrella, 572 U.S. at 686 (noting that it is “not
within the Judiciary’s ken to debate the wisdom” of the
applicable statute of limitations).
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6 INSERSO CORP. v. UNITED STATES
Instead, we consider the prejudicial effects of delay at
the remedy phase. Id. at 685, 687 (noting that in
“extraordinary circumstances, . . . the consequences of a
delay in commencing suit may be sufficient to
warrant . . . curtailment of the relief equitably awarded”).
Here, the Claims Court has the discretion to “award any
relief that the court considers proper,” including
declaratory relief, injunctive relief, and monetary relief
limited to bid and proposal costs. 28 U.S.C. § 1491(b)(2)
(emphasis added). Additionally, the Claims Court “shall
give due regard to . . . the need for expeditious resolution
of the action.” Id., § 1491(b)(3). Thus, the Claims Court is
empowered to consider a protestor’s prejudicial delay when
fashioning relief. Additionally, it is in the public interest
that government-made errors in a solicitation do not go
unreviewed, even if the only feasible remedy given a
protestor’s delay is a declaratory judgment that the
government erred. See Ian, Evan & Alexander Corp. v.
United States, 136 Fed. Cl. 390, 429 (2018) (noting that an
“important public interest” is served through “honest,
open, and fair competition” because such competition
“improves the overall value delivered to the government in
the long term” (internal quotation marks omitted)).
The majority recognizes that Congress imposed a six-
year statute of limitations on bid protests before the Claims
Court. The majority contends, however, that the Blue &
Gold time bar is statutorily authorized because Congress
instructed the Claims Court to give “due regard to
the . . . need for expeditious resolution of the action.” Maj.
Op. at 9 (quoting 28 U.S.C. § 1491(b)(3)). The majority
misreads Section 1491(b)(3).
First, a general and broad “need for expeditious
resolution” of all bid protest claims does not translate into
a discrete statute of limitations for a subset of bid protest
claims, namely solicitation challenges. See Blue & Gold
492 F.3d at 1315 (noting that “it is true that the
jurisdictional grant of 28 U.S.C. § 1491(b) contains no time
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INSERSO CORP. v. UNITED STATES 7
limit requiring a solicitation to be challenged before the
close of bidding”). Specifically, per its plain language,
Section 1491(b)(3) requires the Claims Court to give “due
regard” to expeditious resolution of an action, not license to
override the Claims Court’s six-year statute of limitations.
Additionally, Section 1491(b)(3) must be read in
context with the preceding provision, Section 1491(b)(2),
which gives the Claims Court discretion in affording “any
relief that the court considers proper.” 28 U.S.C.
§ 1491(b)(2); see, e.g., McCarthy v. Bronson, 500 U.S. 136,
139 (1991) (noting that “statutory language must always be
read in its proper context” and not in isolation (emphasis
added)). When both provisions are read in harmony, the
“due regard” provision refers to the Claims Court’s need to
consider expeditious resolution of bid protests when
deciding the proper relief. Specifically, the Claims Court
should consider whether to order the government to restart
the procurement process underlying the bid protest or to
award relief which would not extend the procurement
process, such as bid and proposal costs or declaratory relief.
Lastly, the majority’s reading of Section 1491(b)(3)
runs afoul of the Supreme Court’s reasoning in SCA
Hygiene. As the Supreme Court explained, once Congress
enacts a statute of limitations, the statute governs the
timeliness of claims even in the face of other statutory
provisions. SCA Hygiene, 137 S. Ct. at 963. In SCA
Hygiene, the respondent argued that the Patent Act
codified a laches defense, and, thus, laches could apply
even in the face of a statute of limitations. Id. The
Supreme Court explained that even assuming that the
statute provided for laches “of some dimension,” it did not
follow that such a statutory defense could be invoked to bar
a claim filed within the statute of limitations. Id. The
Supreme Court explained that “it would be exceedingly
unusual, if not unprecedented,” for Congress to include
both a statute of limitations and a laches provision. Id.
The Supreme Court further explained that it was not
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8 INSERSO CORP. v. UNITED STATES
aware of “a single federal statute that provides such dual
protection against untimely claims.” Id. As in SCA
Hygiene, it would be unusual for Congress to provide dual
protection against untimely solicitation-related claims via
the broad discretionary language in Section 1491(b)(3) and
the Claims Court’s clear six-year statute of limitations. If
no federal statute provides such dual protection, it would
be unreasonable to impose a court-made timeliness bar to
overcome a statute of limitations imposed by Congress.
For the above reasons, Blue & Gold conflicts with the
reasoning in SCA Hygiene, and, thus, should not decide the
outcome of this case.
II
Second, the majority improperly shoehorns Inserso’s
claims into the narrow and now undermined Blue & Gold
domain. The Blue & Gold time bar applies only to
challenges of patent errors in a solicitation. Inserso’s
claims, which do not challenge any patent errors in the
solicitation, are not subject to this rule.
The Blue & Gold time bar applies only to challenges
against patent errors in the solicitation. Blue & Gold, 492
F.3d at 1313. “Latent errors or ambiguities are not, of
course, subject” to the Blue & Gold time bar. COMINT Sys.
Corp. v. United States, 700 F.3d 1377, 1382 n.5 (Fed. Cir.
2012). An error is “patent” if it is “an obvious omission,
inconsistency or discrepancy of significance.” Per Aarsleff,
829 F.3d at 1312 (internal quotation marks omitted). By
contrast, “[a] latent ambiguity is a hidden or concealed
defect which is not apparent on the face of the document,
could not be discovered by reasonable and customary care,
and is not so patent and glaring as to impose an affirmative
duty on plaintiff to seek clarification.” Id.
Here, Inserso brought two claims before the Claims
Court: an organizational conflict of interest (“OCI”) claim
and, in the alternative, a claim alleging that the
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INSERSO CORP. v. UNITED STATES 9
government unequally treated offerors. Both of these
claims arise from the government’s disclosure of allegedly
competitive pricing information to only the bidders in the
Full & Open suite—one of two suites at issue. 2 This
unequal disclosure occurred only as a result of a divergence
in the timing of the competitions of both suites. This
timing discrepancy between the two suite competitions
developed well after the release of the solicitations.
There is no obvious error, inconsistency, or discrepancy
from the face of the solicitation indicating that the
government would unequally disclose competitive pricing
information. To the contrary, the solicitation informed
bidders that the government (a) recognized that pricing
information from one suite could be competitively valuable
in the other suite, and (b) would take necessary measures
to prevent unequal disclosure of such information. For
example, the solicitation provided that the government
would not release its estimated labor hours, a key pricing
data point, until the competition for both suite
competitions concluded. J.A. 101918. The solicitation also
provided that the government would identify any potential
2 The competition at issue was divided into two
“suites”: one in which businesses of any size could compete
(the “Full & Open” suite), and one in which businesses
which qualify as “small business concerns” could compete
(the “Small Business” suite). J.A. 101891. Large
businesses could compete in the Small Business suite as
part of a joint venture with a small business. The
solicitation also noted that Full & Open and Small
Business suite competitions would begin simultaneously.
As it played out, the agency completed the Full & Open
suite competition months before the Small Business suite
competition. Inserso competed in the Small Business suite
competition.
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10 INSERSO CORP. v. UNITED STATES
OCIs. J.A. 101815 (“If any [conflicts of interests] become
known to the Government, as defined by FAR Part 9.5, they
will be identified.” (emphasis added)).
To hold otherwise places an undue and unjustified
burden on contractors to actively investigate, anticipate,
and preemptively challenge all conflicts of interest that
could potentially arise under a solicitation. Inserso is not
the government’s keeper. See NetStar-1 Gov’t Consulting,
Inc. v. United States, 101 Fed. Cl. 511, 523 n.17 (2011) (“No
doctrine or case requires a potential protestor to be
clairvoyant or to police an agency’s general noncompliance
with the FAR on the possibility that such misfeasance
might become relevant in a protest.”). Additionally, for
small business contractors, like Inserso, such a burden
could disincentivize entry to the federal procurement
market. Rather, it is the government’s burden to
thoroughly investigate OCIs. For all federal government
procurements, “contracting officers shall analyze planned
acquisitions in order to . . . [i]dentify and evaluate potential
organizational conflicts of interests as early in the
acquisition process as possible; and . . . [a]void, neutralize,
or mitigate significant potential conflicts before contract
award.” 48 C.F.R. § 9.504(a); id., § 9.504(e). 3
The majority argues that Inserso should have known
that the government would disclose competitive pricing
3 Courts should exercise caution in applying the Blue
& Gold time bar to OCI claims, if at all. An OCI is a
significant error that undermines the integrity of the
procurement process. See NKF Eng’g, Inc. v. United States,
805 F.2d 372, 380 (Fed. Cir. 1986) (explaining that an
“unfair competitive advantage . . . damages the integrity of
the proposal system”). Given this gravity, and in light of
SCA Hygiene, a court should review the merits of an OCI
claim rather than bar such claim due to timeliness
concerns.
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INSERSO CORP. v. UNITED STATES 11
information, specifically, details regarding its price
evaluation methodology, to Full & Open competitors
during the debriefing process. 4 Maj. Op. at 11. Thus, the
majority reasons, Inserso should have challenged such
disclosure from the outset of the competition. See id. The
majority misunderstands the nature of agency debriefings.
Apart from certain baseline required disclosures not at
issue here, a government agency has discretion as to what
it will disclose in a debriefing. See 48 C.F.R. § 15.506(d).
Agencies can fail to provide any meaningful information to
bidders. See Anna Sturgis, The Illusory Debriefing: A Need
for Reform, 38 Pub. Cont. L.J. 469, 470, 2009. Thus,
Inserso could not have reasonably known that the
government would release detailed price evaluation
methodology information in the Full & Open suite
debriefings. The majority reaches a contrary conclusion
through the lens of 20/20 hindsight.
The majority also suggests, without any articulated
principled rationale, that the Blue & Gold time bar can
extend to non-solicitation challenges. The majority’s sole
support is a non-binding Claims Court case. See Maj. Op.
at 8 (citing Ceres Envtl. Servs., Inc. v. United States, 97
Fed. Cl. 277, 310 (2011)). We have never previously
extended Blue & Gold beyond challenges to the solicitation.
See, e.g., Bannum, 779 F.3d at 1380; Sys. Application &
4 Once a competition concludes, a bidder may request
a debriefing. See 48 C.F.R. § 15.506(a)(1). A debriefing is
an opportunity for the government to discuss certain
aspects of the competition and its evaluation of the bidder’s
proposal. If requested, the government is required to
debrief the bidder. Id. Generally, bidders request a
debriefing as a matter of course. Here, the government
completed the Full & Open suite competition before the
Small Business suite competition. Thus, the government
debriefed the Full & Open suite competitors before the
Small Business suite competitors.
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12 INSERSO CORP. v. UNITED STATES
Techs., Inc. v. United States, 691 F.3d 1374, 1385 (Fed. Cir.
2012); COMINT, 700 F.3d at 1382; Weeks Marine, Inc. v.
United States, 575 F.3d 1352, 1363 (Fed. Cir. 2009). We
should not do so today. Specifically, such an extension is
contrary to the express reasoning in Blue & Gold. In Blue
& Gold, we relied on a determination that the defect at
issue pertained to the “decision during the solicitation, not
evaluation, phase of the bidding process.” 492 F.3d at
1313. We also noted that a time bar against post-award
challenges stemmed from the Claims Court’s jurisdiction to
adjudicate claims “objecting to a solicitation by a
Federal agency.” Id. (quoting 28 U.S.C. § 1491(b)(1))
(emphasis added). Therefore, Blue & Gold made clear that
any bar applies strictly to solicitation challenges only.
III
Lastly, the majority acts with improper haste when it
bars in the first instance Inserso’s claims pursuant to the
undermined Blue & Gold time bar. As a general matter, a
federal appellate court “does not consider an issue not
passed upon below.” TriMed, Inc. v. Stryker Corp., 608
F.3d 1333, 1339 (Fed. Cir. 2010). There are, however,
“circumstances in which a federal appellate court is
justified in resolving an issue not passed on below, as
where the proper resolution is beyond any doubt, or where
injustice might otherwise result.” Singleton v. Wulff, 428
U.S. 106, 121 (1976) (internal quotation marks and
citations omitted). This is not such a case.
Here, the parties narrowly briefed the applicability of
Blue & Gold below and on appeal. Specifically, neither
party briefed Blue & Gold post-SCA Hygiene and instead
primarily focused on the merits of Inserso’s claims. Most
notably, the Claims Court did not address whether
Inserso’s claims were time-barred under Blue & Gold but
instead reached the merits of Inserso’s claims. Thus, given
this backdrop, we should not apply Blue & Gold in the first
instance. See Wood v. Milyard, 566 U.S. 463, 473 (2012)
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INSERSO CORP. v. UNITED STATES 13
(noting that appellate “restraint is all the more appropriate
when the appellate court itself spots an issue the parties
did not air below, and therefore would not have anticipated
in developing their arguments on appeal”). We should
instead reach the merits of Inserso’s claims.
I respectfully dissent.