ED RFP Litigation Continues Even While RFP “Do-Over” is in Progress

With the RFP “Do-Over” in process one might think the ED RFP litigation would be on hold.  That would be an incorrect assumption. Attorneys for ED and the various firms involved in the RFP litigation are still generating billable hours and pumping out enough pleadings to kill a small forest. The most significant activity has occurred in the past 7 days.  

First - the quick background

insideARM last wrote about the Department of Education (ED) RFP on June 1, 2017. In that article we reported on a significant order issued by the judge presiding over the litigation surrounding the RFP and subsequent protests. As noted in that article, Chief Judge of the United States Court of Federal Claims, Susan G. Braden, issued an order extending indefinitely her Preliminary Injunction prohibiting ED from placing any accounts to any ED Private Collection Agency (PCA) “until the viability of the debt collection contracts at issue is resolved.” 

Meanwhile, as also noted in that article, the ED RFP “Do-Over” is in progress.  Tomorrow, June 16, 2017, is the due date for the submission of revised proposals (unless ED extends the deadline, as they have in the past). Assuming no extension, ED will be evaluating past performance and management approach, selecting the most advantageous proposals, making responsibility determinations and addressing other pre-award activities through August 24, 2017. ED says it will make awards on August 25, 2017. 

Now, the latest

On June 9, 2017 Alltran Education, Inc. (Alltran) filed two separate pleadings. 

The first was a Notice of Appeal of Judge Braden’s Preliminary Injunction. Specifically, Alltran is appealing that aspect of the injunction that prohibits ED from allowing Alltran to perform under its award-term extension (“ATE”) contract (i.e., Task Order No. ED-FSA-17-O-0007 under Contract No. GS-23F-0291K). insideARM wrote about that award on May 3, 2017.  

The second pleading was a Motion to Stay the Preliminary Injunction (as to Alltran).  Specifically, Alltran requests that the Court stay the portion of the injunction currently prohibiting ED from “transferring work” to Alltran’s award-term extension (“ATE”) contract (i.e., Task Order No. ED-FSA-17-O-0007 under Contract No. GS-23F-0291K).

The most recent activity occurred yesterday, June 14, 2017. The court issued a new order denying ED’s earlier motions to dismiss the lawsuits previously filed by Continental Service Group, Inc. (ConServe) and Pioneer Credit Recovery, Inc. (Pioneer). A copy of this latest order can be found here. 

ED had asked the court to dismiss these lawsuits as “Moot” since ED was proceeding with their RFP “Do-Over”. Though she viewed ConServe and Pioneer to be in different situations, Judge Braden disagreed with ED. 

As to ConServe, Judge Braden wrote: 

“The Government’s May 19, 2017 Notice Of Corrective Action, however, did not “completely and irrevocably eradicate[] the effects of the [] violation[s]” alleged in the March 28, 2017 Complaint. At present, Continental has no contract under which it can receive new debt collection accounts. Consequently, Continental is not able to compete for new accounts, until the corrective action is complete and the ED awards new contracts under the Solicitation.” 

As to Pioneer, Judge Braden wrote:

“Pioneer appears to be in a different position, because, on April 28, 2017, Pioneer was offered an award term extension task order under a prior contract. See Coast Professional, Inc. v. United States, No. 15-2017, (Editor’s Note: This was the same ATE that was given to Alltran and referenced above.) Nevertheless, the ED’s corrective action plan does not moot Pioneer’s April 10, 2017 Complaint, because it does not require that the ED stay collection work by the seven awardees of the disputed contracts. If the ED assigns debt collection work to the awardees of the disputed contracts, the amount of collection work available to Pioneer will decrease. Accordingly, Pioneer will suffer a loss of work. Therefore, the corrective action plan does not “completely and irrevocably eradicate[] the effects of the [relevant] violation.” 

The Government previously has represented to Pioneer and the court that the ED “will not transfer any accounts under any of [the seven current] contracts, or otherwise authorize, order or accept any work under those seven contracts, pending the resolution of this protest.” But, the May 19, 2017 Notice of Corrective Action and the May 25, 2017 Amendment To Defendant’s Notice Of Corrective Action did not mention any stay of collection work by the current awardees. Therefore, the court has determined that the ED’s corrective action plan does not moot Pioneer’s case. If Pioneer, however, is completely satisfied with the Government’s representations, it may voluntarily dismiss the April 10, 2017 Complaint, pursuant to RCFC 41(a)(1)(A)(ii).” 

insideARM Perspective 

So, the ED RFP story continues with the addition of these latest chapters.  One of the most interesting items in this latest order was this sentence: 

“The Government previously has represented to Pioneer and the court that the ED “will not transfer any accounts under any of [the seven current] contracts, or otherwise authorize, order or accept any work under those seven contracts, pending the resolution of this protest.” 

This has been assumed, but not been made completely clear by other activity in the case.

insideARM will continue to monitor this story and report on new developments. We have often been asked for a summary of all our articles on the subject. This page provides a running history of our ED related coverage.