MOTION FOR FULL BOARD CONSIDERATION DENIED: December 15, 1994 GSBCA 11915-C-R(11736-P/11745-P) LITTON SYSTEMS, INC., Applicant, v. DEPARTMENT OF TRANSPORTATION Respondent. David V. Anthony, Michael W. Clancy, and Richard P. Rector of Pettit & Martin, Washington, DC, counsel for Applicant. Richard J. McCarthy, John R. McCaw, Jr., and Anthony L. Washington, Office of the Chief Counsel, Federal Aviation Administration, Department of Transportation, Washington, DC, counsel for Respondent. Before the Full Board. ORDER Litton Systems, Inc.'s motion for full Board consideration of the panel's decision in Litton Systems, Inc. v. Department of Transportation, GSBCA 11915-C-R(11736-P/11745-P), 94-3 BCA 27,074, 1994 BPD 149, is DENIED. Board Judges HYATT and WILLIAMS would have granted the motion. DANIELS (Chairman) and NEILL, Board Judges, concurring. We write separately to explain our reason for joining in the Board's denial of Litton's motion. Litton applied for an award of proposal preparation costs pursuant to 40 U.S.C. 759(f)(5)(C) (1988). The application derived from the Board's decision in Denro, Inc. v. Department of Transportation, GSBCA 11736-P, et al., 93-1 BCA 25,315, 1992 BPD 196. That decision upheld protests by Denro and Westinghouse Electric Corporation which alleged that proposals submitted by those firms in a procurement for voiceband switching systems had been improperly excluded from the competitive range. Litton had intervened in those protests in support of the Government, and had argued that the exclusion of Denro and Westinghouse -- which had left Litton as the only offeror in the competitive range -- was correct. The panel denied the application because Litton, as an intervenor in support of the Government, had not prevailed in the protest and was consequently not an "appropriate interested party" to be awarded costs. Under Board Rule 30(a)(1), full Board consideration will ordinarily be ordered "only when (1) it is necessary to secure or maintain uniformity of Board decisions, or (2) the matter to be referred is one of exceptional importance." Litton's request meets neither of these tests. Statute permits the Board, whenever it "determines that a challenged agency action violates a statute or regulation or the conditions of any delegation of procurement authority," to "further declare an appropriate interested party to be entitled to [certain] costs." The costs include those of bid and proposal preparation. 40 U.S.C. 759(f)(5)(B), (C) (1988). The Board's decisions are uniform in that we have never deemed a party which opposed a successful protest to be an appropriate interested party to recover its costs. In the very first case which involved an interpretation of this provision, we held that cost awards should go only to "prevailing parties so as to promote private litigation vindicating public policy, here the policy of . . . full and open competition." Amdahl Corp., GSBCA 7965(7859-P), 85-3 BCA 18,283, at 91,762, 1985 BPD 40, at 8. In another seminal cost case, we noted the Supreme Court's holding that parties have prevailed "if they succeed on any significant issue in litigation which achieves some of the benefit the parties sought in bringing suit." NCR Comten, Inc., GSBCA 8229(8091-P), 86-2 BCA 18,822, at 94,852, 1986 BPD 24, at 10 (quoting Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). By 1989, in an oft-cited decision, we had formulated the rule concisely: "An 'appropriate interested party' is a 'prevailing party,' i.e., one that has succeeded on any significant issue in the litigation that achieves some of the benefit it sought in bringing suit." Bedford Computer Corp., GSBCA 9837-C(9742-P), 89-2 BCA 21,827, at 109,811, 1989 BPD 121, at 3 (citing Texas State Teachers Association v. Garland Independent School District, 489 U.S. 782, 793 (1989)). Litton now asks the full Board to depart from its rule by awarding proposal preparation costs to a party which intervened in a protest in support of the Government's unsuccessful position. Each time an applicant has asked that we award costs to such a party, we have refused. Litton Systems, Inc. v. Department of Transportation, 94-3 BCA 27,074, 1994 BPD 149; Trinet, Inc., GSBCA 9903-C(9746-P), 89-3 BCA 21,960, 1989 BPD 166; TRW Inc., GSBCA 9320-C(9176-P), 88-3 BCA 20,849, 1988 BPD 116. In light of this unbroken record of adherence to a single rule, full Board consideration of the instant case is not "necessary to secure or maintain uniformity of Board decisions." Furthermore, the matter at issue here is not of exceptional importance, for it raises an issue which has rarely been placed before the Board and is unlikely to come this way again. As soon as section 1435 of the Federal Acquisition Streamlining Act of 1994, Public Law 103-355, takes effect -- on October 1, 1995, or such earlier date as the Board prescribes by regulation -- the term "appropriate interested party" will by statute have a meaning similar to that traditionally given it by the Board. No one other than a party which demonstrated a violation of law will be eligible for an award of costs under our protest authority.1 The Board has already approved for publication proposed rules which, if made final within the period of time contemplated by the Act, would make section 1435 effective much earlier than next October. Thus, quite soon, a cost application like the one filed by Litton would have to be denied by virtue of express statutory language with which established precedent is consistent. The issue raised now through the motion for full Board consideration clearly has very limited application. Finally, even if this matter could be construed to have exceptional importance, we would not grant the motion. We find Litton's arguments unpersuasive and therefore consider the Board's rejection of Litton's application to have been correct. Litton's essential argument is one of fairness -- we should do for one competitor what we have done for the others. The Board has already awarded to Litton's competitors the proposal preparation costs they wasted as a result of the Government's violation of law. Westinghouse Electric Corp. v. Department of Transportation, GSBCA 11907-C(11745-P), 93-3 BCA 26,203, 1993 BPD 167; Denro, Inc. v. Department of Transportation, GSBCA 11906-C(11736-P), 1993 BPD 152 (May 27, 1993). Therefore, Litton maintains, we should award such costs to Litton. As an administrative tribunal whose power is limited to that granted by statute, we do not have a court's inherent power to do equity and therefore cannot accede to a request simply because doing so is fair. Sterling Federal Systems, Inc. v. Goldin, 16 ____________________ 1 Section 1435 amends in two ways the statute which authorizes the Board to award costs in protest proceedings. First, it changes the category of persons who may be entitled to reimbursement from "an appropriate interested party" to "an appropriate prevailing party." (Emphasis added). Second, it __________ defines the term "prevailing party," for the purpose of Board cost awards, to mean "a party that demonstrated such violation [of statute, regulation, or conditions of a delegation of procurement authority as the Board determined]." 108 Stat. 3243, 3293. The effective date of this provision is governed by sections 10001 and 10002 of the same Act. Id. at 3404-05. ___ F.3d 1177, 1186 (Fed. Cir. 1994); SMS Data Products Group, Inc. v. Austin, 940 F.2d 1514, 1517 (Fed. Cir. 1991); ViON Corp. v. United States, 906 F.2d 1564, 1567 (Fed. Cir. 1990). Even if we could, the notion that the Board can, through a cost award, put all competitors in a procurement on equal footing is misguided. The vagaries of the business world create far more inequalities than we could possibly correct (if we wanted to do so) or even comprehend. Furthermore, although not applicable in this case, where some firms participated in a procurement, but not in the protest stemming from it, awarding proposal preparation costs to an unsuccessful intervenor as well as the protester would merely redistribute inequities rather than eliminating them; the other competitors would be disadvantaged simply because they stayed out of the litigation. _________________________ _________________________ STEPHEN M. DANIELS EDWIN B. NEILL Board Judge Board Judge VERGILIO, Board Judge, concurring. I concur with the conclusion of the majority of the Board to deny the motion for full Board consideration of Litton Systems, Inc. v. Department of Transportation, GSBCA 11915-C-R(11736-P/ 11745-P), 94-3 BCA 27,074, 1994 BPD 149. As an intervenor of right in opposition to the underlying protest granted by the Board, Litton seeks to recover its costs of proposal preparation, under 40 U.S.C. 759(f)(5)(C)(1988). The Board, through a panel, denied the requested recovery. The facts underlying Litton's assertions do not merit the full Board revisiting the application of the statute. Under Litton's theory, to recover bid and proposal preparation costs, one must be an "appropriate interested party" and need not be a prevailing party to be an appropriate party. Just as Congress has entrusted the Board with some discretion to define precisely what costs are reimbursable, Sterling Federal Systems, Inc. v. Goldin, 16 F.3d 1177, 1187 (Fed. Cir. 1994), Congress has entrusted the Board with discretion to determine who are appropriate interested parties to recover costs of filing and pursuing a protest and of bid and proposal preparation. 40 U.S.C. 759(f)(5)(C). Even if one assumes as Litton contends, that the precedent relied upon by the panel is inconsistent with the dictates of statute and the Federal Circuit, Litton has not raised a reasonable basis which supports a different result. The policy reasons raised by Litton in support of its recovery are not persuasive. I do not agree with the statements in the underlying panel decision that there is a reasonable rationale, which has been put forward, which supports Litton's argument as to the equities of the situation, or that Litton is correct that the denial of costs to Litton creates an inherent inequity among competitors who are returned to the drawing board. Reimbursing costs to all participants in a procurement solely in order to level the playing field and avoid creating competitive advantages has significant implications. Although here only three offerors existed and all participated in the protest, many procurements have far more than three bidders or offerors. If to reimburse any successful protester or intervenor its wasted bid or proposal preparation costs creates an inequitable situation and unlevel playing field for those not so compensated, the agency may readily be faced with reimbursing every bidder or offeror for its wasted costs. Such reimbursement results in a radical shift in costs to the Government, which ultimately penalizes the agency for knowingly or unknowingly violating statute, regulation, or the conditions of procurement authority. Further, throughout the procurement and protest processes Litton gave no indication that it took issue with the capability demonstration tests underlying its present request for recovery; Litton opposed the protests. In light of its position, Litton has not put forward a sufficient basis to support the full Board considering its attempt to explain why it is an appropriate interested party to recovery costs. __________________________ JOSEPH A. VERGILIO Board Judge