## Facts

- The Department of the Navy issued an RFP for maintenance, groundskeeping, janitorial, and related services at U.S. Naval Air Station Sigonella, Italy.
- Four offerors submitted proposals, including Impresa Construzioni Geom. Domenico Garufi (Impresa) and Joint Venture Conserv (JVC).
- JVC was a joint venture of Lara Srl, Impredil Construzioni Srl, and Coop. Bosco Etneo arl; two members had previously performed similar work at Sigonella.
- An Italian criminal court had found Carmelo La Mastra engaged in bid rigging and was involved with a Mafia organization in connection with earlier Sigonella procurements, including intimidation tied to bidding and a killing likely connected to a bid.
- Impresa asserted that La Mastra had controlled two JVC member companies and that another member was controlled by his brother-in-law, creating serious doubt about JVC’s responsibility and an appearance of impropriety.
- After the Navy eliminated Impresa from the competitive range and awarded to JVC, Impresa protested at the GAO, which denied the protest.
- Impresa then filed a bid protest in the Court of Federal Claims, which rejected the challenge; Impresa appealed.

## Issues

1. Whether an unsuccessful offeror has standing under the Administrative Dispute Resolution Act of 1996 (ADRA) to challenge the contracting officer’s affirmative responsibility determination for the awardee.
2. What standard of judicial review applies in ADRA bid protests in the Court of Federal Claims, including review of responsibility determinations.
3. Whether, on the existing record, the Navy’s responsibility determination for JVC had a rational basis given allegations and evidence of organized-crime-related misconduct tied to prior procurements and relationships involving JVC’s constituent entities.

## Decision

- The Federal Circuit held Impresa had standing to challenge the contracting officer’s responsibility determination.
- The court held that ADRA bid protests are reviewed under APA standards: whether agency action was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law, and whether any error was prejudicial.
- The court concluded Impresa raised a substantial question about the rationality of the responsibility determination and that the record was inadequate for meaningful review.
- The court reversed in part and remanded for a limited deposition of the contracting officer concerning the basis for the responsibility determination, and otherwise affirmed.

## Legal Principles

- Under ADRA, an “interested party” (an actual or prospective bidder with a direct economic interest) has standing to bring a bid protest challenging procurement decisions, including affirmative responsibility determinations.
- The Court of Federal Claims reviews bid protest challenges under APA standards and assesses both legality and prejudice.
- Although responsibility determinations are discretionary, they must have a rational basis supported by the record.
- When the administrative record does not reveal the basis for a material procurement judgment, narrowly tailored extra-record discovery may be permitted to enable proper APA review.

## Conclusion

The Federal Circuit recognized bid protest standing to contest an awardee’s responsibility, confirmed APA review as the governing ADRA standard, and required limited discovery and remand where serious allegations called the rational basis for a responsibility determination into question and the record did not permit adequate review.


Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 (Fed. Cir. 2001)