Citing high stakes for Swift & Staley, a Court of Federal Claims judge this week stayed his own order finding the company ineligible for a follow-on landlord services at the Department of Energy’s Paducah Site in Kentucky.
In the five-page order made public Wednesday, Court of Federal Claims Judge Thompson Dietz said Swift & Staley Inc. (SSI) faces “irreparable Injury” if it loses its Paducah Infrastructure Services Contract, potentially worth $160 million over five years, before its challenge is decided by a higher court. The company had been found too big too qualify for the set-aside contract
While Judge Dietz wrote he does not necessarily expect Swift & Staley to prevail in overturning his March 31 ruling before the United States Court of Appeals for the Federal Circuit, the Kentucky-based company has the most to lose. Dietz said the stay will be in effect until the appeals court rules.
There is no time limit for federal appeals court rulings, but various law firm blogs say the process can run anywhere from a couple of months to two years, depending on the complexity of the dispute and demands on the court’s docket.
“Without an injunction, SSI may cease to exist and, even if it prevails on appeal, have no meaningful remedy,” the judge said. The judge said Swift & Staley has “a substantial case on the merits.”
On the other hand, neither the government nor defendant-intervenor, Virginia-based Akima Intra-Data, “have demonstrated that they will suffer significant hardship if an injunction is granted,” the claims court judge said. Akima, a losing bidder, successfully challenged the December 2020 set-aside award to Swift & Staley before the Small Business Administration and eventually the Federal Claims Court.
In his March 31 ruling, Dietz agreed with arguments by Akima and DOE that Swift & Staley was too large by its “negative control” of a joint venture with North Wind Group for similar site services at the Portsmouth Site in Ohio.
“While Akima succeeded in its size protest challenging SSI’s eligibility for award under the solicitation, Akima is still an unsuccessful offeror under the solicitation,” according to this week’s order. With or without an injunction, Akima could still compete against other bidders for the Paducah work, according to the ruling.
“In sum, an injunction pending appeal may result in some temporary harm to the government and Akima, but such harm is far outweighed by the potential significant harm to SSI,” Dietz said in the ruling.
In a motion filed a few weeks ago, the defendant DOE asked the Federal Claims Court to set a March 2023 end date to Swift & Staley’s existing contract, which dates back to October 2015. The existing contract is currently valued at $298 million, thanks to a series of stop-gap extensions during the two years of litigation.
“The government argues that an injunction would further delay critical projects at the Paducah plant, which cannot be assigned and completed under short term bridge contracts,” Dietz said in this week’s ruling. “However, throughout this litigation, the government has expressed its willingness to maintain the status quo” and keep things going with short-term contract extensions, the judge said. The government’s argument of a potential gap in certain services “is too speculative to outweigh the real hardship facing SSI in the absence of an injunction.
