Avkare, Inc v. United States , 125 Fed. Cl. 193 ( 2016 )

In the United States Court of Federal Claims
BID PROTEST
No. 15-1015C
(Filed Under Seal: February 25, 2016 | Reissued: March 1, 2016)*
) Keywords: Motion to Stay Judgment
AvKARE, INC., ) Pending Appeal; RCFC 62(c);
) Injunction
Plaintiff, )
)
v. )
)
THE UNITED STATES OF AMERICA, )
)
Defendant. )
)
James S. Phillips, Argus Legal, LLC, McLean, VA, for plaintiff, with whom were James
S. DelSordo, Of Counsel, and Julie M. Nichols, Of Counsel.
James W. Poirier, Trial Attorney, with whom were Benjamin C. Mizer, Principal Deputy
Assistant Attorney General, Robert E. Kirschman, Jr., Director, and Martin F. Hockey,
Jr., Assistant Director, Commercial Litigation Branch, United States Department of
Justice, Washington, DC, for defendant.
OPINION AND ORDER
KAPLAN, Judge.
Plaintiff AvKARE, Inc. (AvKARE) filed this pre-award bid protest in September
2015. Compl., ECF No. 1. On February 12, 2016, the Court granted judgment on the
administrative record in favor of the government and dismissed AvKARE’s complaint.
ECF No. 47. AvKARE then filed a notice of appeal and a motion to stay the Court’s
judgment pending the outcome of the appeal. ECF Nos. 49–50. In its motion, AvKARE
requested that the Court order the government to extend AvKARE’s current contract
through the pendency of its appeal. For the reasons set forth below, AvKARE’s motion to
stay the judgment is DENIED.
*
This Opinion was originally issued under seal, and the parties were given the
opportunity to request redactions. Neither party requested redactions, and the opinion is
now being reissued in full.
I. Background1
A. AvKARE’s Contract Renewal Offer and Contract Extensions
AvKARE holds a Federal Supply Schedule (FSS) contract with the United States
Department of Veterans Affairs (VA) to supply generic pharmaceuticals to VA and other
government purchasers. See Compl. ¶ 43. AvKARE has held this contract since 2010. Id.
¶ 49.
AvKARE’s contract was originally set to expire on March 31, 2015. Compl. ¶ 44.
In response to the VA’s perpetually open solicitation, AvKARE submitted an offer to
renew the contract on October 31, 2014. Id. The VA evaluated AvKARE’s offer and
found it deficient in several respects. See Admin. R. (AR) Tabs 341–48. Of most
relevance here, the VA concluded that AvKARE was not the “manufacturer” of the
generic pharmaceuticals, but rather was a “dealer/reseller.” AR Tab 344 at 21608.
Further, the VA determined that AvKARE lacked significant commercial sales of the
drugs it wished to offer on the FSS contract. Id. at 21606. For these reasons, the VA
informed AvKARE that it needed to provide certain commercial sales practice (CSP)
information about its suppliers as required by the solicitation’s CSP clause, which was
mandated by 48 C.F.R. § 515.408(b). See id.
AvKARE disagreed. It informed the VA that it, in its view, it was not required to
include its suppliers’ CSP information with its renewal offer because it was the
manufacturer of the items it wished to sell, not a dealer/reseller. See AR Tab 360 at
21679; see also Compl. ¶¶ 28–29. Moreover, AvKARE claimed that its commercial sales
were, in fact, significant. AR Tab 360 at 21677–78. When the parties could not resolve
these disputes, AvKARE filed a bid protest in this Court on March 3, 2015. See Compl.,
AvKARE, Inc. v. United States (AvKARE I), No. 15-cv-216, ECF No. 1. The
government then agreed to extend AvKARE’s contract through September 31, 2015, and
AvKARE voluntarily dismissed that case. See Notice of Voluntary Dismissal, AvKARE
I, ECF No. 17.
Between March 2015 and September 2015, the VA obtained and analyzed
updated commercial sales information from AvKARE. See AR Tabs 191, 386–87. This
information did not include AvKARE’s suppliers’ CSP information, as AvKARE still
contended that it was not required to produce that information. See AR Tab 382 at 21740.
On September 3, 2015, the VA informed AvKARE that its position regarding AvKARE’s
renewal offer had not changed: it still considered AvKARE a dealer/reseller, and it had
again determined that AvKARE lacked significant commercial sales. AR Tab 417.
AvKARE then filed this action; and the government again extended AvKARE’s contract,
1
A detailed recitation of the facts relevant to this case is set forth in the Court’s Opinion
and Order denying AvKARE’s motion for judgment on the administrative record. See
ECF No. 47 at 2–11.
2
this time through January 31, 2016. Finally, the government granted a third extension,
which expires after February 29, 2016.
B. AvKARE’s Requests for Modification
Between 2010 and 2014, the VA granted several requests for modification (RFM)
submitted by AvKARE to add new generic drugs to its contract. Id. ¶ 50. Following an
inspection of AvKARE’s facilities in September 2014, however, the VA began to deny
AvKARE’s RFMs. Id. ¶¶ 63–64. The VA’s rationale for denying these RFMs paralleled
the reasoning behind its decision on AvKARE’s renewal offer—i.e., that AvKARE was
not the manufacturer of the drugs, lacked significant commercial sales of the drugs, and
had not provided manufacturers’ CSP information for the drugs. See AR Tab 173 at
20954–55.
C. Prior Proceedings in This Case
1. AvKARE’s Complaint
In its complaint, AvKARE alleged both that the VA improperly refused to
consider AvKARE’s offer to renew its FSS contract and that it improperly refused to
grant AvKARE’s RFMs. Compl. ¶¶ 44–71. According to AvKARE, the VA routinely
granted RFMs made by similar pharmaceutical repackagers holding VA FSS contracts
issued under the same solicitation. Id. ¶¶ 72–79. AvKARE requested relief on several
grounds, including (1) that the VA’s refusals were the result of bad faith and bias against
AvKARE, id. ¶¶ 80–86, 102–06; (2) that the VA’s refusals constituted an unlawful de
facto debarment, id. ¶¶ 87–92; (3) that the VA’s refusals were arbitrary and capricious,
id. ¶¶ 93–97; and (4) that the VA had breached the obligation of good faith and fair
dealing, id. ¶¶ 98–101.
2. AvKARE’s First Motion to Supplement the Administrative Record
The government compiled an extensive administrative record. See ECF Nos. 16–
17. On October 20, 2015, AvKARE moved to supplement the record. Pl.’s Mot. to Suppl.
the R., ECF No. 19. Among the documents it sought to include were documents
purportedly showing that the VA treated AvKARE differently than another generic
pharmaceutical repackager, whose requests for modification the VA allegedly granted as
a matter of course. Pl.’s Mem. in Supp. of its Mot. to Suppl. the R. at 5–7, ECF No. 20.
The Court denied AvKARE’s motion, concluding that AvKARE failed to show that the
existing record was insufficient to permit effective judicial review. See Opinion and
Order (Op. Den. Mot. to Suppl.) at 4, ECF No. 32. Among other things, the Court
explained that the documents proffered by AvKARE in support of its disparate treatment
claim provided only “general background” about the other repackager, and thus failed to
supply the Court with any “factual basis for assessing the VA’s decision-making process
with respect to [the other repackager], let alone inferring that [the VA] treated AvKARE
differently based on bias or bad faith.” Id.
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3. AvKARE’s Second Motion to Supplement the Administrative Record
On January 28, 2016, AvKARE filed a second motion to supplement the
administrative record. ECF No. 43. This time, it sought to include deposition testimony
from the General Services Administration’s (GSA) current director of FSS programs,
who (in a parallel proceeding before the Civilian Board of Contract Appeals) had testified
about the GSA’s policies and practices for obtaining CSP information and for assessing
price reasonableness if CSP information was unobtainable. See Pl.’s Mem. in Supp. of its
2d Mot. to Suppl. the Admin. R. (Pl.’s 2d Mot. to Suppl.) at 2–4, ECF No. 44. The Court
concluded, however, that this testimony was not necessary to permit effective judicial
review, as the record already reflected the key takeaway from the testimony—that the VA
understood that if relevant manufacturers’ CSP information was demonstrably
unobtainable, then the VA could properly rely on a different method of price analysis to
evaluate AvKARE’s proposal. See Opinion and Order (Op. Den. MJAR) at 21 n.13, ECF
No. 47 (citing AR Tab 436 at 22534). Accordingly, the Court denied the motion. See id.
4. The Parties’ Cross-Motions for Judgment on the Administrative
Record
On February 12, 2016, the Court denied AvKARE’s motion for judgment on the
administrative record and granted the government’s cross-motion for judgment on the
administrative record. The Court explained that it lacked jurisdiction over AvKARE’s
RFM claims because those claims arose under the Contract Disputes Act and AvKARE
had not first submitted claims to the contracting officer as required by that Act. See Op.
Den. MJAR at 12–14. Next, the Court held that AvKARE was not a “manufacturer”
under the plain meaning of the term. Id. at 14–16. The Court rejected AvKARE’s
argument that certain definitions of the term found in other statutory and regulatory
regimes applicable to the pharmaceutical industry compelled a different conclusion. Id. at
16–18. To the contrary, the existence of these specialized definitions showed that “when
legislators and regulators wish to subject entities like AvKARE that repackage and re-
label pharmaceuticals to the same restrictions as entities that fall within the plain meaning
of the term ‘manufacturer’ . . . they do so explicitly.” Id. at 17.
The Court next concluded that the CO’s determination that AvKARE lacked
significant commercial sales was not arbitrary, capricious, or contrary to law. Turning to
AvKARE’s claim that the VA acted in bad faith, the Court held that the record offered no
basis to rebut the presumption of regularity in the VA’s decisionmaking, as “the VA
communicated regularly with AvKARE about AvKARE’s proposal [and] repeatedly
explained to AvKARE why the proposal remained deficient.” Id. at 20. In particular, the
Court rejected AvKARE’s argument that the VA exhibited bad faith by failing to analyze
its proposed prices using a method that did not depend on manufacturers’ CSP
information. In doing so, the Court reasoned that AvKARE never attempted to
substantiate to the VA its position that “relevant information about its suppliers’
commercial sales practices cannot be obtained.” Id. Instead, AvKARE “consistently took
the position that it was not legally obligated to provide any such information at all, even
if it did exist, because AVKARE is not a dealer/reseller and/or because its suppliers’
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commercial sales practices could not possibly be relevant to a determination of whether
AvKARE’s prices were fair and reasonable.” Id. at 20–21.
Finally, the Court held that AvKARE’s de facto debarment claim failed “for
largely the same reasons” as its bad faith treatment claim. Id. at 22. The Court noted that,
far from demonstrating a “systematic intent to refuse to award AvKARE future
contracts,” the VA “consistently told AvKARE that it would move forward with
reviewing AvKARE’s proposal if AvKARE supplied the required manufacturers’ CSP
information.” Id.
II. The Merits of AvKARE’s Motion to Stay the Judgment Pending Appeal
In its motion to stay the Court’s judgment, AvKARE requests that the Court
“[enter] an injunction to require [the government] to extend and hold in abeyance the
expiration of [its] existing Federal Supply Schedule 65IB Contract.” Pl.’s Mot. for Stay
Pending Appeal at 1, ECF No. 50. In determining whether to grant AvKARE’s motion,
the Court considers four factors: (1) whether AvKARE “has made a strong showing that
[it] is likely to succeed on the merits;” (2) whether AvKARE “will be irreparably injured
absent [an injunction];” (3) whether issuing an injunction “will substantially injure the
other parties interested in the proceeding;” and (4) “where the public interest lies.” See
Standard Havens Prods., Inc. v. Gencor Indus., Inc. 897 F.2d 511, 512 (Fed. Cir. 1990)
(quoting Hilton v. Braunskill, 481 U.S. 770, 776 (1987); see also E.I DuPont de Nemours
& Co. v. Phillips Petroleum, 835 F.2d 277, 278 (Fed. Cir. 1987).
These factors “contemplate individualized judgments in each case” and “cannot
be reduced to a set of rigid rules.” Hilton, 481 U.S. at 777. Accordingly, the Court must
“assess[] [the] movant’s chances for success on appeal and weigh[] the equities as they
affect the parties and the public.” DuPont, 835 F.2d at 278; see also Caddell Const. Co. v.
United States, No. 15-645C, 2016 WL 537314, at *19 (Fed. Cl. Feb. 10, 2016) (observing
that “[n]o individual factor is dispositive” and that “the [c]ourt must weigh each factor
against the magnitude of the injunctive relief requested”). As discussed below, the Court
concludes that based on these four factors, AvKARE’s motion should be denied.
A. Whether AvKARE is Likely to Succeed on the Merits
AvKARE is not likely to succeed on the merits. First, AvKARE’s arguments that
it is the manufacturer lack merit. As the Court explained in its Opinion, the fact that some
specialized statutes and regulations define “manufacturer” to include repackagers
indicates that repackagers “would not otherwise be considered ‘manufacturers’ of drug
products in light of that term’s ordinary meaning.” Op. Den. MJAR at 17. And AvKARE
is wrong to state that the definition found in a separate VA procurement statute, 38
U.S.C. § 8126(h), applies to “the item[s] of supply at issue here,” see Pl.’s Mem. in Supp.
of its Mot. for Stay Pending Appeal (Pl.’s Mem.) at 7, ECF No. 51, because (as the Court
explained) that provision applies to single-source drugs, not generic drugs like those
AvKARE sells. See Op. Den. MJAR at 17.
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Moreover, the solicitation’s reference to the FDA’s current good manufacturing
practices (CGMP) is not somehow dispositive, as the relevant CGMP regulations do not
define the term “manufacture” standing alone; rather, they define the “[m]anufacture,
processing, packing, or holding” of drug products to include repackaging. See 21 C.F.R.
§ 210.3(12). Thus, those regulations are of little aid in determining the meaning of the
term “manufacturer” when it appears on its own, as it does in the GSA regulation that
supplied the template for the solicitation’s CSP provision. See 48 C.F.R. § 515.408(b).
AvKARE is equally unlikely to succeed on the merits of its remaining claims. In
terms of its bad faith claim, AvKARE contends that by denying its first motion to
supplement the administrative record, the Court hobbled its ability to show that the VA
treated it disparately. See Pl.’s Mem. at 9–11. As the Court observed in that Opinion, a
plaintiff wishing to supplement the administrative record with alleged evidence of bad
faith must first make a “‘strong showing of bad faith or improper behavior,’” Pitney
Bowes Gov’t Sols., Inc. v. United States, 93 Fed. Cl. 327, 332 (2010) (quoting Ala.
Aircraft Indus., Inc. v. United States, 82 Fed. Cl. 757, 766 (2008)), and that showing must
“rest on ‘hard facts,’ not merely innuendo or suspicion,” Inforeliance Corp. v. United
States, 118 Fed. Cl. 744, 747 (2014) (quoting Int’l Res. Recovery, Inc. v. United States,
61 Fed. Cl. 38, 43 (2004)).
The evidence AvKARE sought to introduce about the other offeror did no such
thing, for (as the Court explained) it provided no “factual basis for assessing the VA’s
decision-making process with respect to [the other offeror], let alone inferring that [the
VA] treated AvKARE differently based on bias or bad faith.” Op. Den. Mot. to Suppl. at
4. In other words, the proposed documents shed no light on whether the offeror to which
AvKARE sought to compare itself was similarly situated to AvKARE in any relevant
way. And, to the contrary, documents in the existing record indicate that AvKARE’s
competitor in fact differed from AvKARE in relevant ways. See AR Tab 413 at 22489
(email to AvKARE stating that the VA “[is] not treating [other offerors] any differently
than they are treating AvKARE;” that “AvKARE is the only repackager who asserts that
they are the manufacturer;” that “[o]ther companies similarly situated to AvKARE
acknowledge that they are a dealer/reseller;” and that “[d]epending on the other
companies [sic] commercial sales VA may or may not require manufacturer’s CSP data,
that is a case by case determination”). Thus, AvKARE’s invitation to infer bad faith
based on the VA’s treatment of the other offeror rested not on “hard facts” about the
VA’s decisionmaking, but on mere “innuendo or suspicion.” See Inforeliance, 118 Fed.
Cl. at 747.
AvKARE further argues that by denying its second motion to supplement the
administrative record, the Court prevented it from showing that the VA violated certain
GSA regulations and policies that govern the VA’s administration of its FSS contracts.
See Pl.’s Mem. at 8–9. But as the Court has explained, to the extent the deposition
testimony AvKARE wished to include was relevant to the case, it was duplicative of
information already in the record. See Op. Den. MJAR at 21 n.13. On the other hand,
several portions of the testimony that AvKARE wished to include were not relevant to
the case. For example, AvKARE wished to include testimony establishing that there are
“other means of determining price” if the contractor “is the manufacturer” and lacks
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commercial sales. See Pl.’s Mem. in Supp. of its 2d Mot. to Suppl. the R. at 6. This
testimony is irrelevant to VA’s decisions in this case because the VA determined
(correctly) that AvKARE was not the manufacturer.
Similarly, AvKARE wished to include statements establishing what the VA could
have done if manufacturers’ CSP information was “not available or . . . just not there.” Id.
at 9. These statements are irrelevant because, as the Court explained, there is no evidence
in the record showing that the information the VA seeks from AvKARE is not available;
instead, AvKARE has consistently taken the position that “it is not legally obligated to
provide the VA with manufacturers’ CSP information, even if it does exist and is
obtainable.” Op. Den. MJAR at 20–21 & n.13. Accordingly, denying AvKARE’s second
motion to supplement the record did not somehow prevent AvKARE from showing that
the VA violated applicable GSA regulations, as the non-duplicative information
AvKARE wished to include related only to hypothetical situations, not the actual facts of
the case.
In this regard, the Court is not persuaded by the claim AvKARE advances in its
reply brief that it was only as a result of representations made in the government’s brief
that it understood that the VA would be willing to employ a different method of price
analysis upon a demonstration by AvKARE that it could not obtain manufacturers’ CSP
information. See Pl.’s Reply in Sup. of its Mot. for Stay Pending Appeal at 2–4, ECF No.
54 (describing the government’s acknowledgment of this possibility as a “‘game changer’
that establishes a wonton lack of good faith and fair dealing on the part of the VA in its
treatment of AvKARE”). First of all, the administrative record itself reveals that the VA
held this view. See AR Tab 436 at 22534 (email from the VA’s FSS director stating that
“[i]f CSP data is not received, AvKare must prove that CSP data is not available from
their manufacturers,” and that “[if] CO verified CSP data is not available from
manufacturer, then proceed to reliance solely on price analysis”). Thus, AvKARE has
been aware of this position since at least October 2015 when the government produced
the administrative record. In addition, the Court also discussed this issue with the
government at the oral argument on the parties’ cross-motions for judgment on the
administrative record. See Transcript of Hearing at 57:2–17 (Jan. 13, 2016).
More importantly, the VA’s explicit acknowledgment during this litigation that it
would consider alternative methods of price analysis if AvKARE proved that CSP
information could not be obtained from its suppliers does not assist AvKARE’s argument
that the VA did not act in good faith. As the Court has noted, AvKARE has never walked
back its position that it is the manufacturer and therefore that it is not required to provide
its suppliers’ CSP information. Nor does the record provide any indication that AvKARE
made an effort to show that manufacturers’ CSP information was not available; instead,
the record shows that AvKARE consistently and categorically denied that it had an
obligation to produce it. See AR Tab 360 at 21679 (asserting that AvKARE need not
provide manufacturers’ CSP information because “we are not a dealer or reseller” and
“[the dealer/reseller] provision is not applicable to our offer”); AR Tab 382 at 21740
(asserting AvKARE’s belief that manufacturers’ CSP information “is neither required (as
AvKARE is the manufacturer of its private label products and has significant commercial
sales of those products) nor relevant”). In fact, AvKARE still clings to those arguments
7
before this Court. There was no occasion, therefore, for the VA to consider whether
AvKARE had made a sufficient showing of unavailability to justify use of an alternative
method of price analysis, nor any decision for this Court to review regarding the VA’s
supposed failure to do so.
Finally, AvKARE is unlikely to succeed on the merits of its de facto debarment
claim. At the outset, AvKARE’s contention that the Court improperly excluded evidence
demonstrating its de facto debarment claim is belied by AvKARE’s own memorandum in
support of its first motion to supplement the record, in which it stated that “the record as
filed contains ample evidence of the agency’s de facto debarment of AvKARE.” See Pl.’s
Mem. in Supp. of it Mot. to Suppl. the R. at 2. Moreover, the Court did not “import” a
bad faith standard into its analysis of AvKARE’s de facto debarment, as AvKARE would
have it. See Pl.’s Mem. at 9–10. That is, the Court did not deny AvKARE’s de facto
debarment claim because it denied AvKARE’s bad faith treatment claim; rather, it denied
AvKARE’s de facto debarment claim for “largely the same reasons” it denied
AvKARE’s bad faith claim. See Op. Den. MJAR at 22. Specifically, the Court concluded
that the VA’s conduct did not amount to a “systematic effort” to deny contract awards to
AvKARE because the VA’s decision not to further evaluate AvKARE’s renewal
stemmed from the parties’ dispute over a legal issue—i.e., whether AvKARE was the
“manufacturer” or not. As the government itself has admitted, had the Court held that
AvKARE was the manufacturer, the VA would have moved forward with its evaluation.
See Def.’s Reply to Pl.’s Response to Def.’s Cross-Mot. for J. on the Admin. R. at 6–7,
ECF No. 40. Thus, the VA has not demonstrated a systematic intent to deny AvKARE
even the contract at issue in this case, let alone any other contract AvKARE might seek.
Accordingly, for all the reasons discussed above and set forth in its opinion
granting judgment on the administrative record to the government, the Court concludes
that AvKARE is not likely to succeed on the merits of its appeal.
B. Whether AvKARE Will Suffer Irreparable Harm Absent and Injunction
AvKARE argues that it will suffer irreparable harm if the Court does not issue an
injunction because the loss of its FSS contract will decrease its annual revenues by more
than $6 million and force it to terminate twelve employees. Pl.’s Mem. at 12. While
significant, these are the types of harms that any incumbent contractor experiences upon
the loss of a contract. See Akima Intra-Data, LLC v. United States, 120 Fed. Cl. 25, 28–
29 (2015); CRAssociates, Inc. v. United States, 103 Fed. Cl. 23, 26–27 (2012) (noting
that “[i]f plaintiff is right that these typical types of harm warrant a stay pending appeal
here, then such would be true for every incumbent who fails to obtain a successor
contract”); PGBA, LLC v. United States, 60 Fed. Cl. 196, 221 (2004). Notably, AvKARE
has not alleged that the loss of this contract would pose an immediate threat to its entire
business. See Akima Intra-Data, 120 Fed. Cl. at 28–29.
Further, the Court finds that to the extent that AvKARE does suffer harm as a
result of the denial of a stay, such harm is to some extent of its own making. Thus, the
only obstacle to AvKARE’s ability to secure consideration of its offer is its refusal to
either provide its suppliers’ CSP information or demonstrate that it cannot obtain the
8
information the VA seeks. Moreover, the VA has agreed to multiple extensions of
AvKARE’s contract during the course of this litigation, notwithstanding that AvKARE
has flatly refused to comply with the VA’s request for its suppliers’ CSP information.
Thus, AvKARE has not shown that it will suffer irreparable harm absent an injunction.
C. Whether Issuing the Injunction Will Substantially Injure the Other
Parties Interested in the Proceeding
Given the nature of the FSS contract at issue, issuing a stay to AvKARE will not
“substantially injure any other parties interested in the proceeding” except as outlined
below in the discussion of the public interest. Unlike a typical procurement, granting an
injunction in favor of AvKARE would not prevent any other VA FSS schedule
contractors from moving forward with their own contracts. This factor, accordingly,
should be subsumed within factor four, which concerns where the public interest lies.
D. Where the Public Interest Lies
The parties dispute the extent to which the public interest, measured by dollars
spent, favors AvKARE. AvKARE claims that the government would save more than $2
million each month if AvKARE’s contract remains in effect, Pl.’s Mem. at 13, while the
government contends that the figure is much lower, Def.’s Opp’n to Pl.’s Post-J. Mot. for
a Prelim. Injunction at 8, ECF No. 53.
This debate over the extent to which AvKARE is or is not providing the
government with a good deal, however, is not the measure of whether granting a stay
would serve the public interest. As a general matter, the public has a strong interest in
ensuring compliance with the laws governing procurement. See SAI Indus. Corp. v.
United States, 60 Fed. Cl. 731, 747 (2004); Metcalf Const. Co., Inc. v. United States, 53
Fed. Cl. 617, 645 (2002); see also FAR 1.102(a) (stating that that purpose of the federal
acquisition system as a whole is “to deliver on a timely basis the best value product or
service to the customer, while maintaining the public’s trust and fulfilling public policy
objectives”). And that interest is particularly acute here, where the regulation in question
provides the method for resolving the debate over whether AvKARE’s prices are fair and
reasonable, and thus for determining whether contracting with AvKARE serves the
taxpayers’ interests. See Info. Scis. Corp. v. United States, 80 Fed. Cl. 759, 799 (2008)
(discussing the public’s interest in “ensuring that the ultimate awardee offers the ‘best
value’ to the Government, pursuant to the terms of the Solicitation and applicable
procurement regulations”).
In short, GSA has determined that in order to help the government avoid being
overcharged for products that are also sold commercially, it is necessary to insist that
dealer/resellers without significant commercial sales supply manufacturers’ CSP data, at
least absent a demonstration that such data is not obtainable. Accordingly, the public has
a strong interest in seeing this regulatory requirement enforced as to AvKARE’s offer.
That interest would be frustrated, however, if AvKARE’s contract were extended again,
this time by court order rather than by the consent of the parties.
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CONCLUSION
For the reasons set forth above, the Court concludes that AvKARE is unlikely to
succeed on the merits of its appeal and that it has not made a persuasive case that it will
necessarily suffer irreparable harm if the Court does not issue the injunction. Moreover,
the public interest in compliance with a regulatory regime designed to ensure fair and
reasonable pricing of items on the Federal Supply Schedule favors denial of AvKARE’s
stay request. Therefore, AvKARE’s motion to stay the Court’s judgment pending appeal
is DENIED.
IT IS SO ORDERED.
/s/ Elaine D. Kaplan
ELAINE D. KAPLAN
Judge
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