The Competition in Contracting Act (CICA) of 1984 establishes a procedure that effectively pauses performance of a federal contract award during a bid protest.
If a disappointed bidder files a protest with the Government Accountability Office (GAO) within certain set timelines, then the government is automatically required to maintain the status quo while the protest is litigated. The stay eliminates the risk that performance on the contract continues to a point where – even if the protest is successful – there is no relief available to the protester (the dreaded “win the battle – lose the war” scenario).
Over the years, these “CICA Stays” have become a crucial element of the bid protest process. In particular, the availability of an automatic stay incentivizes protesters to file at GAO, whereas protests at the Court of Federal Claims (COFC) do not offer an automatic stay.
But what happens if a protester and a procuring agency disagree as to whether a CICA Stay must be put in place during the pendency of a GAO protest?
The COFC decision in Starside Security & Investigation, Inc., v. United States, confirms that the court has jurisdiction to hear challenges to an agency’s refusal to impose an automatic stay. Notably, the Starside decision also found that the time period for triggering an automatic stay may be equitably tolled, thereby requiring a CICA Stay despite an apparently untimely GAO protest.
This decision serves as a helpful reminder about the reviewability of a procuring agency’s conduct with respect to a CICA Stay. Protesters do not have to give up this valuable tool without a fight.
The CICA Stay Rules
Under CICA, a contracting officer must stay contract performance when they receive notice from the GAO that a protest has been filed (i) within 10 days of contract award or (ii) within 5 days after the debriefing date that is offered to an unsuccessful offeror when a debriefing is required (31 U.S.C. § 3553(d)(3)–(4)). When the Department of Defense conducts an enhanced debriefing, the 5-day period does not begin until the day the government delivers written responses to questions submitted by the disappointed offeror.
Potential protesters should note the CICA Stay protest timeliness rules are separate from the timeliness deadlines set forth in GAO’s Bid Protest Regulations (4 C.F.R. § 21.2). Although the two sets of timeliness rules often overlap, it is possible that a protest could be timely for consideration by GAO, yet untimely for purposes of triggering a CICA Stay.
Would-be protesters should also remember that the agency may nevertheless override the stay and authorize the performance of the contract under certain conditions (e.g., urgent and compelling circumstances).
The COFC Decision
In Starside Security & Investigation, Inc., v. United States (COFC No. 19-1453C), the contract at issue was awarded on August 15; however, Starside did not file its GAO protest until September 9. The contracting officer did not order a stop of contract performance because the GAO protest was filed after the 10-day period for securing a CICA Stay.
Starside filed a protest at the COFC, asserting that the agency unreasonably failed to provide timely notice of the contract award. The protester argued that based on the unique facts of the case, the 10-day period should be equitably tolled, thus requiring an automatic stay of performance.
As an initial matter, the court confirmed that challenges to alleged violations of the CICA automatic stay provision are within the COFC’s jurisdiction. The court went on to find that as an actual bidder, Starside was an interested party and therefore had standing to bring the protest.
Addressing the substance of Starside’s challenge, the court first concluded that the 10-day CICA Stay period could be equitably tolled. The court reasoned that the statutory period was “on the order of a claims-processing rule rather than a jurisdictional rule.” And as a result, the court found that Congress did not preclude application of the equitable tolling doctrine when it established the CICA Stay timeliness rules.
Next, the court considered whether tolling was warranted based on Starside’s unique circumstances. The court explained that to be entitled to equitable tolling, a party must establish (1) that it has been pursuing its rights diligently, and (2) that some extraordinary circumstance stood in its way and prevented timely filing. Ultimately, the court found that equitable tolling was appropriate based on the following key facts:
- The agency failed to provide Starside with notice of the award on August 15
- The agency assured Starside that it would receive notice once the contract was awarded
- The agency failed to post award information on publicly available databases
- Starside made several inquiries into the status of the award
- Starside filed a GAO protest with 5 days of learning that award had been made
Based on these unique facts, the court found that Starside diligently pursued its rights and that circumstances beyond its control had prevented timely filing of its GAO protest. Accordingly, the court held that Starside was entitled to an automatic stay of performance of the protested contract under CICA.
Key Takeaways
- Know the Timeliness Rules. Unsuccessful offerors should pay close attention to the timeliness rules associated with obtaining a CICA Stay. As noted above, the timeliness rules for receiving an automatic stay under CICA are not identical to the timeliness rules set forth by GAO. Adding to the complexity, the applicable rules are determined by whether the procurement involves a required debriefing, which is not always clear. So in addition to understanding the timeliness rules, disappointed offerors should consider contacting outside counsel for advice about how the rules apply in a particular situation.
- Consider COFC as a Protest Venue. The Starside decision provides a helpful reminder that the COFC is an available venue for CICA Stay-related protests. Thus, when a potential protester believes that the procuring agency has violated the automatic stay rules, it may pursue a challenge at the COFC (assuming the company has the necessary standing). In addition, if the automatic stay period has lapsed at GAO, companies should keep the COFC in mind as a forum for bringing a post-award protest. Even though automatic stays are not available at the COFC, there are ways in which the status quo can be maintained during the protest proceedings. The agency may agree to a voluntary stay or the protester may convince the court that a preliminary injunction is appropriate.
- Assess Whether Equitable Tolling Applies. In the Starside case, the court found that the applicable CICA Stay period was equitably tolled. The court’s conclusion was based on the particular circumstances presented and such an analysis will no doubt be very fact specific. That said, potential protesters should remember that equitable tolling may apply to their situation — especially where the agency misleads the offeror as to when contract award was made.
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