It's Not Over; Would-Be ED Debt Collection Contractors Continue the Fight

As planned, on Monday the Department of Education (ED) filed a motion to dismiss the case of FMS Investment Corp. (FMS) et. al., v. The United States and Performant Recovery, Inc. et al. because its decision to cancel the solicitation for unrestricted debt collection contractors made the case moot. The court gave all parties until this Friday to indicate whether they plan to oppose that motion.

As of today, four firms have notified the court of their intention to oppose: FMS, Account Control Technology, Continental Service Group, and GC Services LP. This begins a sort of Chapter Three in the matter of this highly valuable and hotly contested contract for private debt collection services.

Chapter One began in 2014 when the five-year 2009 contract ended, and new large-firm awards were delayed. Eventually, contracts were awarded in 2016 to seven large companies, down from 17 on the previous contract. This led to dozens of protests by firms that believed the process was flawed and unfair. So began Chapter Two of the matter, with a "re-do" of the solicitation, which resulted in awards to just two large companies. This led to more protests, and finally... nothing. No large company awards at all, as ED cancelled the whole solicitation last week, and rescinded the contract awards from the two companies.

insideARM Perspective

Something I found interesting that kind of faded away was that on March 6, 2018, Judge Wheeler said he was “convinced that Plaintiffs are likely to succeed on the merits of their bid protests.” Although the continued expense of fighting for this contract has got to be onerous, I suspect the potential contractors feel the facts are on their side, and maybe the judge is too.

This may never end.