Pride International, LLC, No. 4649 (July 30, 2004) Docket No. SIZ-2004-06-24-39 UNITED STATES OF AMERICA SMALL BUSINESS ADMINISTRATION OFFICE OF HEARINGS AND APPEALS WASHINGTON, D.C. ) SIZE APPEAL OF: ) ) Pride International, LLC ) Docket No. SIZ-2004-06-24-39 ) Appellant ) ) Decided: July 30, 2004 RE: Metscan Technologies, LLC ) d/b/a Prisoner Transportation ) Services ) ) Solicitation No. MS-04-R-005 ) United States Marshals Service ) Judicial Security Contracts ) Washington, DC APPEARANCE David M. Hernandez, Esq. Pillsbury Winthrop LLP for Appellant DIGEST A large business has standing to protest the size of a successful offeror in a small business set-aside procurement only where there is only one remaining offeror. DECISION HOLLEMAN, Administrative Judge: Jurisdiction This appeal is decided under the Small Business Act of 1958, 15 U.S.C. Section 631 et seq., and 13 C.F.R. Parts 121 and 134. Issue Whether a large business has standing to protest the size of a successful offeror in a small business set-aside procurement where there is only one remaining offeror. I. BACKGROUND A. The Procurement On January 9, 2004, the United States Marshals Service of the Department of Justice (USMS) issued the subject solicitation for the short term lease of narrow bodied (single aisle) large passenger/transport jet aircraft to perform its missions of moving federal prisoners and illegal aliens. The solicitation seeks to award three contracts, one at each of three different operational sites. The sites are Oklahoma City, Oklahoma; Mesa, Arizona; and Alexandria, Louisiana. The contractor will lease the aircraft to USMS, and be responsible for aircraft maintenance and logistics. USMS will operate the aircraft. The Contracting Officer (CO) set the procurement aside for small business, and designated North American Industry Classification System (NAICS) code 532411, Commercial Air, Rail, and Water Transportation Equipment Rental and Leasing, with a corresponding $6 million annual receipts size standard, as the applicable NAICS code for the procurement. Offers were due on February 19, 2004. Amendment 1, issued on February 9, 2004, extended the due date to February 26, 2004. Amendment 2 was issued on March 3, 2004. Amendment 3, issued on April 2, 2004, announced the conclusion of discussions, and set April 9, 2004, as the due date for final proposal revisions. Three offerors submitted bids for each of the three operational sites: Pride International, LLC (Appellant); Metscan Technologies, LLC d/b/a Prisoner Transportation Services (Metscan); and Aviation Enterprises, Inc. (AEI). None of these offerors has been declared ineligible for reasons unrelated to its small business status. [1] B. The Protest On May 6, 2004, the CO issued notices that the apparent successful offerors were Appellant for the Oklahoma City and Alexandria contracts, and Metscan for the Mesa contract. On May 11, 2004, Appellant filed a protest with the CO, asserting Metscan was other than small. Appellant alleged that Metscan will not perform at least 50% of the cost of the contract incurred for personnel with its own employees. Appellant asserted, based upon its own knowledge of the type of work associated with this contract, that over 90% of the personnel costs associated with the contract will be line maintenance of the aircraft, and Metscan does not employ personnel qualified for this purpose. Appellant also asserts Metscan is affiliated with Shuler Capital Corporation of Savannah, Georgia; Coastland Builders Group, Inc. of Savannah, Georgia; Bankers Realty Corporation of Savannah Georgia; and Bird and Loechl of Atlanta, Georgia. Appellant asserts that Metscan, together with its affiliates, exceeds the applicable size standard. On May 12th, the CO forwarded the protest to the Small Business Administration (SBA) Office of Government Contracting - Area V, in Dallas, Texas. Meanwhile, AEI had filed a size protest against Appellant on May 6th. On May 27, 2004, the SBA Office of Government Contracting - Area IV in Chicago, Illinois issued a size determination finding Appellant an other than small business. On June 17, 2004, Appellant appealed that size determination to this Office. On July 28, 2004, this Office denied the appeal, and affirmed the size determination finding Appellant other than small. Size Appeal of Pride International, LLC, SBA No. SIZ-4648 (2004) (Pride I). On June 2, 2004, the instant case was transferred to SBA's Office of Government Contracting - Area III, in Atlanta, Georgia (Atlanta Area Office), because Metscan's home office is located in Savannah. On June 3, 2004, the Atlanta Area Office dismissed Appellant's protest as insufficiently specific. The Atlanta Area Office further found that Appellant did not have standing to protest Metscan's size because Appellant had been found other than small on May 27th. Appellant received the dismissal on June 10, 2004. C. The Appeal On June 24, 2004, Appellant filed the instant appeal. Appellant alleges that on May 17, 2004, it supplemented its protest by submitting additional information to the CO concerning Metscan's subcontracting its maintenance responsibilities under the contract. This letter, if it was sent, does not appear in the record before the Atlanta Area Office. Appellant argues that: (1) Its protest was sufficiently specific for the Area Office to initiate a size determination on Metscan; and (2) Appellant still had standing to protest Metscan's size because it had appealed the determination it was other than small to this Office. II. DISCUSSION Appellant filed the instant appeal within 15 days of receiving the size determination, and thus the appeal is timely. 13 C.F.R. Section 134.304(a)(1). Appellant has the burden of proving, by a preponderance of the evidence, all elements of its appeal. Specifically, it must prove the Area Office size determination is based on a clear error of fact or law. 13 C.F.R. Section 134.314; Size Appeal of Procedyne Corp., SBA No. SIZ-4354, at 4-5 (1999). The Atlanta Area Office properly dismissed Appellant's protest for lack of standing. Appellant was found to be a large business for this procurement in a size determination ultimately affirmed by this Office. Pride I, at 3, 5-6. A large business has standing to protest the size of a successful offeror in a small business set aside procurement only where there is one remaining offeror. 13 C.F.R. Section 121.1001(a)(1)(iv); Size Appeal of Lajas Industries, Inc., SBA No. SIZ-4285, at 6 (1998). Here, there are clearly at least two other offerors, Metscan and AEI. Appellant's argument that its pending appeal to this Office gave it standing to protest is not supported by either the regulation or this Office's precedent. [2] Appellant thus had no standing to protest Metscan's size, and the Atlanta Area Office properly dismissed the protest. Appellant has failed to establish clear error of fact or law on the part of the Area Office, and thus the Administrative Judge must AFFIRM the Atlanta Area Office's dismissal of Appellant's size protest. III. CONCLUSION For the above reasons, the Administrative Judge AFFIRMS the Area Office's size determination and DENIES the instant appeal. This is the final decision of the Small Business Administration. 13 C.F.R. Section 134.316(b). CHRISTOPHER HOLLEMAN Administrative Judge _________________________ 1 This information was clarified by the CO in a submission made on July 29, 2004, at the request of the Administrative Judge and served on all parties. 2 However, while Appellant's protest was properly dismissed for lack of standing, the Area Office did err in finding it insufficiently specific. Appellant's identification of certain firms as affiliates of Metscan was enough to make the protest sufficiently specific. Size Appeal of Carriage Abstract, Inc., SBA No. SIZ-4430, at 6 (2001). However, this does not save Appellant from dismissal of its protest, as it had no standing to protest. Posted: September, 2004