A federal magistrate judge Wednesday recommended dismissing construction firm Hill International’s claims against the V.I. Public Finance Authority and Disaster Recovery Office.
Hill filed a lawsuit against the government in September after the PFA awarded a three-year contract to oversee the territory’s sprawling disaster recovery effort to a rival bidder. Hill’s bid to perform the work came in at just under $30.3 million, but the contract went to CH2M for $137 million — a disparity “so great as to make the award to CH2M arbitrary and capricious,” according to the company’s complaint.
Further, the company alleged that the PFA had a conflict of interest because three of the five evaluation committee members who selected the winning firm were employed by the V.I. Public Works Department, which also employed two people working for CH2M’s parent company, Jacobs Solutions.
Hill also cited the government’s initial request for proposals, which stated that a minimum of two contractors would be selected to manage the territory’s multibillion dollar disaster recovery projects.
The company asked the court for a temporary restraining order, preliminary injunction and declaratory relief.
The PFA refuted Hill’s claims, stating in their response that the government selected the company that offered the best value to the territory — not the one with the lowest price. The PFA, which moved the case from V.I. Superior Court to U.S. District Court, argued that Hill failed to follow normal bid protest rules and asked the court to dismiss the claims.
U.S. Magistrate Judge G. Alan Teague sided with the government in the report and recommendation filed Wednesday and indicated that he was unconvinced by Hill’s argument that contract award was improper because the procurement process was handled by the PFA rather than the V.I. Property and Procurement Department.
“In sum, it is purely speculative whether the award to CH2M instead of Hill … can be fairly traced to PFA, and not [Property and Procurement], conducting the procurement,” he wrote. Teague then noted that Hill was simultaneously arguing that the PFA lacked the statutory authority to award the contract and that the PFA should have awarded the contract to Hill because its bid price was lower.
“To paraphrase the Supreme Court …‘it would be quite odd’ for Hill to complain about PFA not awarding a contract to Hill that Hill thinks it cannot lawfully award in the first place,” he wrote.
Hill also attempted to bring a taxpayer suit against the government, arguing that the government’s selection of CH2M constituted a waste of the territory’s money.
“As an initial matter, the complaint alleges no facts from which the Court can conclude that the Plaintiff is a Virgin Islands taxpayer,” Teague wrote.
Teague later wrote that Hill’s complaint failed to show that the PFA’s single contract award was arbitrary and capricious because “the plain and reasonable interpretation of the RFP is that [the] Defendant had discretion to issue one or more contract awards.” He added that Hill’s failure to challenge any ambiguity “constituted acceptance of all terms” and that Hill waived the issue by failing to bring it up before the award.
“[F]or all of these reasons, and considering that Hill sought and still seeks a single contract to perform both [project management] and [construction management] services, Hill cannot show PFA had no rational basis to determine that the Territory’s needs are best served by awarding one contract for the scope of work,” he wrote.
Teague further disagreed with Hill’s conflict of interest claim.
“The complaint alleges only that some of the evaluation committee members work at the same place as two employees of CH2M’s parent company,” he wrote. “But there are no allegations suggesting the evaluation committee members and Jacob’s [sic] employees worked together, or that they intentionally or inadvertently exchanged information that gave CH2M an unfair advantage in preparing its bid, or caused the committee to unfairly favor CH2M or disfavor Hill.”
