In Continental Services Group, Inc. v United States (No. 17-449, March 29, 2017), the U.S. Department of Education issued a solicitation for the collection and administrative resolution of debts resulting from non-payment of student loans.  Continental Services (“CS”) submitted an offer.  CS was not selected for the award and, as did other disappointed bidders, filed a timely bid protest at GAO.  The protests triggered a CICA stay of performance. The CICA stay, which is automatic and mandatory, requires agencies to withhold award or suspend performance of an award upon timely notice from the GAO of a protest.  Agencies can override that stay only if there are urgent and compelling circumstances or if it is in the best interests of the United States.  GAO can’t enforce CICA stays.  So if protesters disagree with an agency’s override, they must challenge the override in the Court of Federal Claims (“COFC”).

In this case, the Department of Education did not override the CICA stay.  Instead, it began transferring the work to be performed to other contracts. That looked like an effort to circumvent the CICA stay.  Rather than challenge the agency’s actions as a violation of the CICA stay, CS withdrew its bid protest from the GAO and filed a protest at the COFC.  The COFC does not have an equivalent to the automatic CICA stay.  At the COFC, the government must either agree to a voluntary stay or the protester must obtain a temporary restraining order (“TRO”) and/or preliminary injunction.  In this case, the agency did not agree to stay performance and CS filed a motion for a TRO.

CS’s decision to file a bid protest in court rather than directly challenge the agency’s circumvention of the stay led to an interesting decision from the COFC.  Had CS challenged the Department of Education’s actions as arbitrary and a violation of the CICA stay, the COFC would have determined whether the decision to override the stay was arbitrary. But because CS filed a bid protest against the selection decision, the COFC had to consider whether to grant a TRO against continued performance of the contract that had been awarded (apart from the propriety of the override of the CICA stay).  In so doing, the COFC held that it was not in a position to consider the likelihood of success on the merits of CS’s bid protest at all.  According to the decision “since the Government has not yet produced the Administrative Record and the parties have not had an opportunity to brief the merits of this bid protest, the court is not in a position to decide Continental Services’ likelihood of success.”  Yet, the COFC still issued the TRO.  Some view this decision as easing the requirements for obtaining a TRO at the COFC, inviting more bid protests before the COFC.  Or it may be a one-off decision made in response to agency efforts to circumvent the CICA stay.  Indeed, in granting relief, the COFC specifically ordered the government to halt “transferring work to be performed under the contract at issue in this case to other contracting vehicles to circumvent or moot this bid protest…”.  Regardless, COFC judges are not bound by one another’s decisions, so there is no telling whether the reasoning in Continental Services will be applied in similar cases in the future.

To view the COFC decision, click here.

Isabel Buchanan is a UK lawyer, currently on secondment to Brown Rudnick in DC.  She is not licensed to practice in the US.