Clinicomp International, Inc. v. United States
Opinion
CliniComp International, Inc. ("CliniComp") appeals a decision of the U.S.
*1356 Court of Federal Claims ("Claims Court") dismissing CliniComp's pre-award bid protest for lack of standing. We affirm.
BACKGROUND
I
The Department of Veterans Affairs ("VA") and Department of Defense ("DoD") operate two of the nation's largest healthcare systems and serve an overlapping patient population. Over the past twenty years, these two government agencies have tried to make their respective electronic health records ("EHR") systems interoperable.
In 2011, the VA and the DoD committed to developing an integrated EHR system, which would replace the agencies' separate systems with a common system. But in 2013, the agencies abandoned that plan in favor of separate initiatives concerning their own EHR systems.
The DoD decided to purchase a commercially available system to replace its then-existing "AHLTA" EHR system. In 2015, after a competition, the DoD awarded a $4.3 billion contract for delivery of a modern, commercial off-the-shelf EHR system. This EHR system consists primarily of software developed by Cerner Corporation ("Cerner").
The VA, for its part, decided to modernize its then-existing "VistA" EHR system. The VA issued a request for information in April 2017 concerning the industry's capability of providing a commercialized version of VistA. It also engaged a private consultant, Grant Thornton, to assess the market's ability to meet the VA's needs through four options-three involving acquiring a commercial off-the-shelf EHR system, and the fourth involving modernizing VistA. Grant Thornton issued a report on May 17, 2017, finding that the market could support all four options. The report concluded that the VA's best option for improving interoperability with the DoD would depend on the VA's own evaluation of the benefits and risks of acquiring a commercial off-the-shelf system versus modernizing VistA.
The VA ultimately chose to acquire a new system rather than modernize its old one. On June 1, 2017, the VA Secretary invoked the public-interest exception to the Competition in Contracting Act's requirement of full and open competition,
Under the contract, at a minimum, Cerner will provide the full scope of services, including integration, configuration, testing, deployment, hosting, organizational change management, training, and sustainment, and licenses necessary to deploy the DoD's EHR system in a manner that meets VA needs. The contract will also address all EHR functions supporting clinical care including revenue cycle, in-patient, ambulatory, as well as home care, ancillaries, and specialties to include dental. The contract will also *1357 address non-clinical core functional requirements, which may include inventory management/supply chain capabilities.
J.A. 10005.
II
CliniComp is an incumbent provider of EHR systems to the VA. It filed this bid protest with the Claims Court, asserting (among other things) that the VA's sole-source decision lacked a rational basis and violated the Competition in Contracting Act. CliniComp also moved for a preliminary and permanent injunction preventing the VA from awarding a sole-source contract to Cerner. Cerner intervened. CliniComp then moved for judgment on the administrative record, and the government and Cerner responded with motions to dismiss and cross-motions for judgment on the administrative record.
The Claims Court granted the motions to dismiss, finding that CliniComp lacked standing to protest the VA's sole-source decision.
CliniComp Int'l, Inc. v. United States
,
The Claims Court found that CliniComp failed to show that it had a "direct economic interest" because CliniComp failed to show that it could have competed for the contract had the procurement process been competitive. Id. at 750. In particular, the court found that CliniComp failed to show that it had experience providing EHR services for the substantial number of facilities to be covered by the proposed contract to Cerner. That contract would cover approximately 1,600 VA healthcare sites, while CliniComp had provided EHR services for only 44 VA healthcare facilities and 56 DoD medical treatment facilities. Id. The court also found that CliniComp had not demonstrated any experience providing the comprehensive services required under the proposed contract to Cerner. Id. at 750-51. For example, the court noted that the proposed contract to Cerner would require support of in-patient and outpatient services, and CliniComp had not demonstrated experience providing outpatient services. Id. at 751.
Based on the evidence before it, the Claims Court concluded that CliniComp lacked standing because it "has not shown that [it] has the kind of experience that would enable it to compete for the work contemplated by the VA's planned contract with Cerner." Id. The Claims Court therefore dismissed for lack of standing. CliniComp appeals that dismissal.
We have jurisdiction under
DISCUSSION
I
We review standing determinations de novo and any underlying fact findings for clear error.
Digitalis Educ. Sols., Inc. v. United States
,
*1358
The Claims Court's jurisdiction over bid protests is articulated in
The party invoking federal jurisdiction bears the burden of establishing standing.
Myers Investigative & Sec. Servs., Inc. v. United States
,
Second, the plaintiff must show that it was prejudiced by a significant error in the procurement process.
II
CliniComp challenges the VA's decision to award an EHR-system contract to Cerner on a sole-source basis. We have addressed what a plaintiff must show to establish prejudice in the sole-source context. In
Myers
, we held that a plaintiff bears the burden of establishing that it had a substantial chance of receiving the award.
The Claims Court in
Myers
found no prejudice because the plaintiff had "not proven it had the sources or the man-power to supply the ... services sought by [the sole-source contracts]" and had "not provided the court with any evidence demonstrating that it ha[d] been awarded or successfully performed contracts for similar services in the past."
A similar analysis and conclusion apply here. The Claims Court reviewed the record,
*1359
including what the proposed contract to Cerner would require and evidence bearing on CliniComp's capabilities. The Claims Court noted that the contract would require comprehensive EHR services-both in-patient and outpatient-at 1,600 VA healthcare sites.
CliniComp
,
Prejudice is a fact question.
E.g.
,
Diaz
,
Resisting this conclusion, CliniComp argues that because this is a pre-award protest, the Claims Court should have applied the test for prejudice articulated in
Weeks Marine, Inc. v. United States
,
We first evaluated the plaintiff's standing to bring its pre-award protest to the terms of the solicitation. We noted that, in that context of a pre-award challenge to a competitive solicitation, "it is difficult for a prospective bidder/offeror to make the showing of prejudice that we have required in post-award bid protest cases."
Here, unlike in Weeks Marine , there is a dispute as to whether CliniComp could do the work required under the proposed contract to Cerner. And as described above, CliniComp failed to show that it was a qualified bidder in this regard. Absent *1360 such a showing, CliniComp could not satisfy the "non-trivial competitive injury" standard for prejudice set forth in Weeks Marine . In other words, to suffer a non-trivial competitive injury , CliniComp must at least be qualified to compete for the contract it seeks. Therefore, although we apply the standard for prejudice as articulated in Myers , our conclusion would be the same applying the "non-trivial competitive injury" standard set forth in Weeks Marine .
CliniComp also argues that the requirements of the proposed Cerner contract are not known, and therefore, we cannot conclude that CliniComp is incapable of performing the contract.
See
CliniComp's Br. 29, 36, 39. The Claims Court rejected this argument, finding that "[t]he administrative record contains ample evidence regarding the nature and scope" of the proposed contract to Cerner.
CliniComp
,
CliniComp further argues that it has standing because, as an incumbent EHR systems provider to the VA, it stands to lose work as a result of the proposed award to Cerner. CliniComp's Br. 34 ("CliniComp has standing to challenge a VA procurement decision that will result in the VA terminating CliniComp's business and its use of CliniComp's products."). But to have standing, CliniComp's prejudice must be due to some alleged error in the procurement process.
Labatt
,
CliniComp finally argues that it is qualified to compete because it could hire subcontractors to help do the work required under the proposed contract to Cerner. CliniComp's Br. 41. The Claims Court did not address this argument-possibly because CliniComp did not raise it in its briefing on the motions to dismiss or motions for judgment on the administrative record. 1 Even if not forfeited, however, the argument is unpersuasive. CliniComp has not supplied any details regarding how, or with whom, it would subcontract to perform what is required under the proposed contract to Cerner. 2 CliniComp's vague, cursory references to using subcontractors to perform the work it is unable to do are *1361 insufficient to cure CliniComp's otherwise deficient showing that it is a qualified bidder here.
CONCLUSION
We have considered CliniComp's other arguments and find them unpersuasive. For the foregoing reasons, we affirm the Claims Court's dismissal for lack of standing. 3
AFFIRMED
COSTS
The parties shall bear their own costs.
At oral argument, CliniComp's counsel confirmed that CliniComp first raised this issue in rebuttal at the oral argument at the Claims Court. Oral Arg. at 2:08-23, No. 2018-1101, http://www.cafc.uscourts.gov/oral-argument-recordings.
After oral argument at the Claims Court, CliniComp moved the Claims Court for leave to file a supplemental brief with an exhibit addressing CliniComp's ability to subcontract. The Claims Court denied CliniComp's motion, and CliniComp has not appealed that denial. We therefore do not consider those materials.
Our affirmance of the Claims Court's dismissal moots CliniComp's motions for injunctive relief, ECF Nos. 3 & 77.
Reference
- Full Case Name
- CLINICOMP INTERNATIONAL, INC., Plaintiff-Appellant v. UNITED STATES, Defendant-Appellee Cerner Corporation, Defendant-Cross-Appellant
- Cited By
- 79 cases
- Status
- Published