Case: 22-1766    Document: 67     Page: 1   Filed: 01/02/2024




   United States Court of Appeals
       for the Federal Circuit
                  ______________________

           B.H. AIRCRAFT COMPANY INC.,
                   Plaintiff-Appellant

                             v.

       UNITED STATES, GENERAL ELECTRIC
        COMPANY, DBA GE EDISON WORKS,
                Defendants-Appellees
               ______________________

                        2022-1766
                  ______________________

     Appeal from the United States Court of Federal Claims
 in No. 1:21-cv-01629-ZNS, Judge Zachary N. Somers.
                  ______________________

                 Decided: January 2, 2024
                  ______________________

     SAM GDANSKI, Gdanski Law PC, Teaneck, NJ, for
 plaintiff-appellant. Also represented by ABRAHAM
 GDANSKI.

     DANIEL B. VOLK, Commercial Litigation Branch, Civil
 Division, United States Department of Justice, Washing-
 ton, DC, for defendant-appellee United States. Also repre-
 sented by BRIAN M. BOYNTON, PATRICIA M. MCCARTHY,
 DOUGLAS K. MICKLE.

    RICHARD P. RECTOR, DLA Piper US LLP, for defendant-
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 2                           B.H. AIRCRAFT COMPANY INC. v. US




 appellee General Electric Company. Also represented by
 THOMAS EDWARD DALEY.
                 ______________________

      Before DYK, REYNA, and STARK, Circuit Judges.
 PER CURIAM.
     B.H. Aircraft Company, Inc. (“B.H. Aircraft”) filed a bid
 protest action in the Court of Federal Claims to challenge
 the inclusion of F414 afterburner liner replacement ser-
 vices within a larger contract for the United States Depart-
 ment of the Navy (“Navy”). The Court of Federal Claims
 concluded that B.H. Aircraft lacked standing. Alterna-
 tively, the Court of Federal Claims concluded that B.H.
 Aircraft failed to state a claim upon which relief could be
 granted because B.H. Aircraft had not established a viola-
 tion of the bundling regulation.
     Consistent with our recent opinion in CACI, Inc.-Fed.
 v. United States, 

, 1151–52 (Fed. Cir. 2023),
 we hold that the standing issue here (i.e., whether B.H.
 Aircraft is a qualified bidder) is one of statutory standing,
 which overlaps with one aspect of the merits. The other
 merits issue is whether the contract violates the bundling
 regulations. We review the Court of Federal Claims’ deci-
 sion as to standing and failure to state a claim de novo. The
 Court of Federal Claims reviews the decisions of the con-
 tracting officer as to statutory standing and as to the appli-
 cation of the bundling regulation under the standard of
 “arbitrary, capricious, an abuse of discretion, or otherwise
 not in accordance with law.” PAI Corp. v. United States,
 

 (Fed. Cir. 2010) (quoting Bannum, Inc.
 v. United States, 

 (Fed. Cir. 2005)); Im-
 presa Construzioni Geom. Domenico Garufi v. United
 States, 

, 1332 n.5 (Fed. Cir. 2001). We agree
 with the Court of Federal Claims that under that standard
 B.H. Aircraft failed to state a claim on which relief could be
 granted. We affirm.
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 B.H. AIRCRAFT COMPANY INC. v. US                            3



                        BACKGROUND
      For some years, the Navy had entered into sole-source
 Performance Based Logistics (“PBL”) contracts with Gen-
 eral Electric Company, dba GE Edison Works (“GE”) for
 maintenance of its F414 plane engines. The prevailing con-
 tract was set to expire, and on December 3, 2020, the Navy
 issued a pre-solicitation notice “for the anticipated F414
 Fleet Support Performance Based Logistics contract” with
 an “expected period of performance” from May 1, 2022, to
 April 30, 2027. J.A. 408. The notice said “[p]rospective of-
 ferors must submit a source approval request to NAVSUP
 WSS to become an approved Navy source of supply” and
 “[t]hese items require Government Source Approval prior
 to award.” 

 Responses were required by December 18,
 2020.
     The PBL solicitation eventually provided for repair of
 some parts and replacement of others, as contemplated by
 the pre-solicitation notice. In total, the solicitation was to
 cover 778 engine components, 706 of which were consuma-
 ble and thus were only replaced, and not subject to repair.
 The other 72 engine components were repairable, including
 the F414 afterburner liner at issue in this case. The solic-
 itation provided that repairable items could be replaced
 with a new unit if repair was not feasible.
     In a letter dated January 25, 2021, B.H. Aircraft re-
 quested that the replacement of the F414 afterburner liner
 be removed from the PBL contract (apparently while leav-
 ing the repair service of the afterburner liner in the con-
 tract) so that B.H. Aircraft could bid on replacing the F414
 afterburner liner. B.H. Aircraft’s theory has been that the
 Navy impermissibly bundled the F414 afterburner liner in
 the contract in violation of the Federal Acquisition Regula-
 tion (“FAR”). The Navy contracting officer (“CO”) declined
 to remove replacement of the F414 afterburner liner from
 the PBL and issued the solicitation on March 31, 2021.
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 4                           B.H. AIRCRAFT COMPANY INC. v. US




     In an April 28, 2021, letter to B.H. Aircraft, the Navy
 CO explained that exclusion of afterburner liner replace-
 ments was not warranted. The Navy CO stated that
 “NAVSUP WSS has reviewed the synopsized and solicited
 market basket and does not concur with B.H. [Aircraft]’s
 contract bundling assertion. NSN 2840-01-480-8247 is cur-
 rently being supported under contract N00383-18-D-P601,
 and has been determined to be sole sourced to the Original
 Equipment Manufacturer.” J.A. 648. The CO also found
 that B.H. Aircraft was not a qualified bidder for the re-
 placement work in any event.
     B.H. Aircraft filed a bid protest complaint in the Court
 of Federal Claims arguing that “the repair [of the F414 af-
 terburner liner] should be segregated from the bundled
 PBL.” J.A. 75. In its complaint, B.H. Aircraft conceded
 that it “is not presently an approved ‘repair’ vendor,” J.A.
 69, but contended that it was qualified to manufacture re-
 placement afterburner liners and that the CO erred in con-
 cluding otherwise.
      The Court of Federal Claims dismissed B.H. Aircraft’s
 complaint for lack of standing on the ground that the CO
 had not erred because B.H. Aircraft, although approved to
 manufacture F414 afterburner liners, was not a qualified
 bidder, as B.H. Aircraft’s allegations and evidence “call[ed]
 into question not only [its] capability to manufacture the
 [F414 afterburner] liner but whether it even understands
 how to make the [F414 afterburner] liner in question in the
 first place.” B.H. Aircraft Co. Inc. v. United States, 

, 767 (2022). The Court of Federal Claims also
 dismissed for failure to state a claim because B.H. Air-
 craft’s complaint did not “allege—and the record does not
 support—that the instant procurement is a bundled con-
 tract,” 

 since B.H. Aircraft made “no allegation of a sep-
 arate smaller contract for F414 afterburner liners that is
 being bundled into the instant solicitation” being chal-
 lenged. 

 (emphasis omitted). Therefore, the
 Court of Federal Claims found the complaint failed to
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 B.H. AIRCRAFT COMPANY INC. v. US                            5



 adequately allege that the CO had erred in concluding that
 this was not a bundled contract, as would be required un-
 der the FAR provisions B.H. Aircraft attempted to invoke.
 B.H. Aircraft appeals.
     We have jurisdiction under 

(a)(3).
                         DISCUSSION
     Under our recent decision in CACI, the standing issue
 here is a matter of statutory standing rather than jurisdic-
 tion. CACI, 

. “The standing issue here [for
 a bid protest] presents a question of statutory standing ra-
 ther than Article III standing.” 

 1 Because the issues of
 bidder qualifications and whether there is a bundled con-
 tract to be unbundled overlap with the merits (the qualifi-
 cation of a contractor being a quintessential merits issue),
 the Court of Federal Claims reviews the decision of the CO
 that there is no bundled contract—and that B.H. Aircraft
 was not a qualified bidder—under the standard established
 by the Contract Disputes Act. 

(b)(2)(A);
 PAI, 

; Impresa, 

 n.5.
     Because the standing issue here is not jurisdictional, it
 is not necessary that we decide it as a prerequisite to reach-
 ing the merits (which here, as we noted, overlap with the
 question of standing). See CACI, 

 (declining to consider issues of statutory standing and in-
 stead proceeding to merits). We do not reach the issue of
 bidder qualifications. We instead turn to the Court of Fed-
 eral Claims’ holding that B.H. Aircraft failed to state a
 claim on which relief could be granted. We review the trial
 court’s dismissal for failure to state a claim de novo. See
 Dehne v. United States, 

 (Fed. Cir. 1992).


     1    Because our decision was issued after briefing was
 completed in the appeal now before us, neither the Court
 of Federal Claims nor the parties had the benefit of our de-
 cision in CACI.
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 6                             B.H. AIRCRAFT COMPANY INC. v. US




 The Claims Court ultimately reviews the decision of the CO
 to determine whether his actions “were ‘arbitrary, capri-
 cious, an abuse of discretion, or otherwise not in accordance
 with law.’” CACI, 

.
     Under 

(j)(3), federal agencies shall
 “avoid unnecessary and unjustified bundling of contract re-
 quirements.” “Bundling of contract requirements” is de-
 fined as “consolidating 2 or more procurement
 requirements for goods or services previously provided or
 performed under separate smaller contracts into a solicita-
 tion of offers for a single contract that is likely to be unsuit-
 able for award to a small-business.” 

(o)(2).
 The FAR similarly defines “bundling.” See FAR 2.101. As
 the Court of Federal Claims concluded, “[p]laintiff simply
 has not shown—or even properly alleged—that two or more
 separate smaller contracts have been bundled together to
 form the current solicitation.” B.H. Aircraft, 158 Fed. Cl.
 at 771.
     The Court of Federal Claims therefore correctly con-
 cluded that B.H. Aircraft’s complaint failed to state a claim
 on which relief could be granted. The Navy CO did not err
 in determining that the bundling regulation was not vio-
 lated. We need not reach the issue of bidder qualification
 as to the replacement portion of the contract. Accordingly,
 we affirm.
                          AFFIRMED