Court of Federal Claims dispenses just rulings so far

There have been a few surprises. Nearly all the protesters are small to midsize
companies. Moreover, in several cases, the court has acted as a court of appeals,
reviewing a protest previously decided, at least in part, by the General Accounting

An important recent decision is CCL Inc. vs. United States. The case resulted
from the consolidation of far-flung military data processing into a group of megacenters
run by the Defense Information Systems Agency.

The ruling has important implications for the accelerating process of reorganization
sweeping all agencies. (Disclosure: My firm and I represented the plaintiff, CCL.)

The case concerned a contract awarded to BDM International Inc. of McLean, Va., to
provide equipment and services to six Air Force Logistics Command (AFLC) computer centers.
A prominently stated objective of the contract was to consolidate the logistics-related
computing activities of the Air Force into the six centers. The consolidation was one
aspect of Defense Management Review Decision 924, a Defense Department initiative to
achieve efficiencies by consolidating data processing.

As diligent readers of GCN know, the process did not end there. DMRD 924 was superseded
by DMRD 918. DMRD 918 advanced the cause of consolidation in two important respects.
First, it made DISA the provider of information processing services throughout DOD.
Second, for the first time, it authorized consolidation across service boundaries.

DISA took over the management of data processing centers from the services and the
Defense Logistics Agency. Among these were the six AFLC data processing centers. In
addition to the centers themselves, DISA inherited ongoing contracts, including the one
between AFLC and BDM.

For reasons not discussed in the court's opinion, DISA apparently found the BDM
contract to be a convenient vehicle, and it expanded the scope of the contract from the
six original data processing centers to all 16 DISA megacenters.

The expansion of the BDM contract displaced other contractors, including CCL, of
Bethesda, Md. It had won a contract to supply and maintain a large computer system at what
became the Denver megacenter. At the expiration of the last fiscal year, DISA did not
renew CCL's maintenance order, and instead added the work to BDM's contract.

CCL brought suit in the Court of Federal Claims, alleging that the Denver work was
improperly added to BDM's contract.

The controlling law had been established by a decision of the Court of Appeals for the
Federal Circuit. A contract modification amounts to a sole source award if it was outside
the scope of the competition for the original contract.

Accordingly, the Court of Federal Claims examined the competition for and award of the
original BDM contract.

The government argued for an expansive reading. It noted that the solicitation
mentioned DMRD 924 and contended that any activity in furtherance of DOD's consolidation
efforts would be within scope. CCL countered that the contract as awarded was more modest,
and limited to the six Air Force logistics centers.

The court resolved the dispute by a painstaking and detailed review of the solicitation
and the resulting contract.

The judge recognized that the government required flexibility in its contracts for
information technology but that such contracts still had to have reasonable limitations,
or else the requirement for competition would become meaningless.

Here, that limit was the six original computing centers. The terms of the solicitation
and contract did not warn bidders of any expansion beyond the six centers.

The broader boundaries that the government sought were not in DMRD 924, but in the
later DMRD 918, which the solicitation did not reference.

Therefore, the court held that the expansion of the BDM contract beyond the original
six centers was improper.

The government information technology community will be watching the future rulings of
this court. Current developments leave many unresolved questions, and the Court of Federal
Claims may provide answers to the new questions spawned by procurement reform.

Joseph J. Petrillo is an attorney with the Washington law firm of Petrillo &
Powell, PLLC. E-mail him at [email protected].

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