The Full Federal Circuit to Hear Percipient.ai Bid Protest, Limiting Argument to Interested Party Standing
And so it begins – On Friday, the U.S. Court of Appeals for the Federal Circuit ("Federal Circuit") issued an order that vacated the panel decision in Percipient.ai, Inc., v. United States, 104 F.4th 839 (Fed. Cir. 2024), and granted en banc review of the bid protest appeal. Review of a government contracting case en banc is a rare occurrence at the Federal Circuit; it means that the full complement of judges will hear and decide on the protest appeal (a regular panel consists of only three judges).
Relevant here, the full panel is only interested in the question of interested party standing. On that issue, the panel majority in the now-vacated decision concluded that:
"For all these reasons, we hold that, in the context of this case involving alleged violations of 10 U.S.C. § 3453 without challenging the contract, an interested party includes an offeror of commercial or nondevelopmental services or items whose direct economic interest would be affected by the alleged violation of the statute. Here, Defendants do not dispute Percipient’s direct economic interest. Percipient offers a commercial product that is plausibly alleged to satisfy the agency’s needs, has plausibly alleged inter alia that the agency violated the requirements of §3453 by not evaluating its product for integration into the SAFFIRE procurement, has plausibly alleged that but for this violation of the statute its Mirage product would be incorporated into the SAFFIRE procurement, and has offered NGA and CACI its product. Under these facts, we hold that Percipient has standing to challenge the agency’s alleged violation of § 3453."
Turning back to the en banc order, two things are worth highlighting: (1) as noted above, the full court will not revisit (and thus will not require briefing) on every aspect of the vacated panel decision, rather the full court is only interested in the "interested party" question (i.e., "Who can be 'an interested party objecting to . . . any alleged violation of statute or regulation in connection with a procurement or a proposed procurement' under 28 U.S.C. § 1491(b)(1)?") and (2) amicus briefs are permitted without consent and leave of the court.
"The court will not revisit and does not require additional briefing on the issues of task bar under the Federal Acquisition Streamlining Act of 1994 (FASA), 10 U.S.C. § 3406(f); subject matter jurisdiction under 28 U.S.C. § 1491(b)(1); and timeliness of claims under Blue & Gold Fleet, L.P. v. United States, 492 F.3d 1308 (Fed. Cir. 2007)."
"The court invites the views of amicus curiae. Any amicus briefs may be filed without consent and leave of the court. Any amicus brief supporting Percipient’s position or supporting neither position must be filed within 14 days after service of Percipient’s en banc opening brief. Any amicus brief supporting the United States’ position must be filed within 14 days after service of the United States’ response brief. Amicus briefs must comply with Fed. Cir. R. 29(b)."
Also, for a thoughtful discussion on this bid protest case, check out the following articles: (1) Nathaniel Castellano and Aime Joo's article in The Nash & Cibinic Report – BID PROTEST JURISDICTION AND STANDING: Percipient.ai Presents Federal Circuit With Critical Questions, and (2) Adam Bartolanzo's article in The Procurement Lawyer – Lowering the King’s Ears: Delimiting the Waiver of Sovereign Immunity for Bid Protests after Percipient.ai.
Takeaway
As bid protest practitioners before the U.S. Court of Federal Claims know all too well, the interested party framework – and indeed other protest concepts – is nuanced and fragmented at the court. A full panel decision on "interested party" standing could crystallize the many cases which cover that issue and, in so doing, will provide protesters (and their counsel) with clarity. Further, and given the Federal Circuit's open invitation for participation by amicus curiae, I anticipate that we will see a number of "friend of the court" briefs that offer thoughtful, well-written views on both sides of this important issue. Stay tuned.
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