C. A. PC-2020-06551
For Plaintiff: Jackson C. Parmenter, Esq. Erin A. Hockensmith, Esq. Michael A. Kelly, Esq. For Defendant: Daniel W. Majcher, Esq. For Intervenor: Jeremy Ritzenberg, Esq. William M. Russo, Esq.
For Plaintiff: Jackson C. Parmenter, Esq. Erin A. Hockensmith, Esq. Michael A. Kelly, Esq.
For Defendant: Daniel W. Majcher, Esq.
For Intervenor: Jeremy Ritzenberg, Esq. William M. Russo, Esq.
Before this Court for decision is the Rhode Island Department of Administration (DOA), by and through Brett Smiley acting in his official capacity of Chief Purchasing Officer for the State of Rhode Island, and Rhode Island Department of Transportation's (RIDOT), by and through Peter Alviti, Jr., P.E. acting in his official capacity as Director (Respondents), Motion to Dismiss the Petitioners' Petition for Declaratory Judgment, Injunctive Relief and Writ of Mandamus (Petition). Respondents move to dismiss the Petition for failure to state a claim upon which relief can be granted under Rule 12(b)(6) of the Superior Court Rules of Civil Procedure and/or for lack of subject matter jurisdiction under Rule 12(b)(1). Barletta/Aetna I-195 Washington Bridge North Phase 2 JV (the JV), Aetna Bridge Company (Aetna), and Barletta Heavy Division, Inc. (Barletta) (Petitioners) object to Respondents' Motion to Dismiss. The Court heard this motion remotely via WebEx on November 19, 2020. Jurisdiction is pursuant to Rule 12 of the Superior Court Rules of Civil Procedure.
I. Facts and Travel
This action arises out of the bidding process that occurred during the second phase of a construction project on I-195 Washington Bridge North (Project) owned by RIDOT. The DOA is a state agency in charge of advertising requests for proposals and creating the "Procurement Regulations" which govern the solicitation process pursuant to G.L. 1956 §§ 37-2-1 et seq. (State Purchases Act). See G.L. 1956 § 37-2-13; 220-RICR-30-00-5.6(C)(5). Aetna is a Rhode Island corporation with its principal place of business located in Warwick, Rhode Island. (Petition ¶ 2.) Barletta is a Massachusetts corporation with its principal place of business located in Canton, Massachusetts. Id. ¶ 3. The JV is a joint venture organized for the purposes of submitting a proposal in order to obtain a contract with RIDOT in connection with phase two of the Project. Id. ¶ 1. Cardi Corporation (Cardi), the Intervenor in this action, was hired to perform certain work during the first phase of the Project and submitted a bid for the second phase of the Project as well. See id. ¶¶ 12, 19.
In December of 2016, Respondents issued a request for proposals concerning I-195 Washington North (Phase 1 of the Project) and awarded the contract to Cardi. Id. ¶¶ 11-12. Cardi performed certain work for Phase 1 until RIDOT terminated and/or cancelled the contract between the parties. Id. ¶ 13. On April 10, 2020, Respondents issued Request for Proposal # 7603376 (Phase 2 RFP), which sought proposals for "Best Value Design-Build Procurement for Bridge Group 57T-10: I-195 Washington North, Phase 2" (Phase 2 of the Project). Id. ¶¶ 1, 14. Responses by bidders were due on July 17, 2020. Id. ¶ 15. In total there were three bidders who submitted proposals, including Petitioners and Cardi. Id. ¶ 19.
Section 2.1 of Part 1 of the Phase 2 RFP provided that Phase 2 of the Project "will principally consist of the rehabilitation of the I-195 Washington Bridge North Phase 2 and the associated new on and off ramps in Providence and East Providence . . . Phase 1 of the project was the recently completed partial rehabilitation of the substructure of the bridge." Id. ¶ 16. Further, Section 3.1 of Part 1 of the Phase 2 RFP included a list of certain work that would be included in the rehabilitation of the Washington Bridge. Id. ¶ 17. One such activity included in the list was the "installation of link slabs." Id. The Phase 2 RFP also included a description of the work that occurred during Phase 1, which in pertinent part stated that "[a] partial rehabilitation of the Washington Bridge (Washington North Phase 1) was undertaken from 2016 through 2019 as part of Contract 2016-CB-059 . . . [O]nly a portion of the work depicted in the 2016 contract documents was completed during the Washington North Phase 1 project[.]" Id. ¶ 18.
Following the issuance of the Phase 2 RFP, the three bidders, including the JV, submitted questions to Respondents in order to clarify the quantity and description of the work completed during Phase 1 of the Project. Id. ¶ 19. One such question listed numerous repair items that were included in the previous Phase 1 contract with Cardi but were not included in "Form N and Section 3.7.3 of the [Phase 2] RFP" and asked for Respondents to provide estimates for those repair items. Id. RIDOT responded to the question about the missing repair items as follows: "With the exception of the bearing replacements at Pier 14 the items mentioned have not been performed. For items with estimated and only bid quantities, previously completed quantities have been taken into account. No additional items will be added to Form N." Id.
"In addition to the questions and answers exchanged," the JV attended certain field/site inspections where it apparently became "evident" to the JV that certain work that was contemplated for Phase 2 of the Project (including work on "link slabs") "may" have been completed during Phase 1 of the Project. See id. ¶¶ 22-23. However, because of Respondents' answers to the bidders' questions and what was stated in the Phase 2 RFP, Petitioners included in their submitted proposal the cost for the work that they had observed may have been completed during Phase 1. Id. ¶¶ 21-24.
On August 17, 2020, Respondents issued an "Apparent Best Value determination" that put forth each bidder's "final score." Id. ¶¶ 50-54. Based on this determination, Petitioners then became aware that Cardi's proposal price for Phase 2 was "significantly" less than the JV's price proposal, and, on August 27, 2020, submitted a bid protest pursuant to the States Purchases Act and the Procurement Regulations. Id. ¶ 56.
On September 15, 2020, in response to the bid protest, the Respondents issued a State Determination, stating, among other things, that Cardi had "proposed maintaining all existing bridge joints and did not include the construction of any link slabs at fixed joints[.]" Id. ¶¶ 58, 60. This is apparently work that Petitioners had included in their proposal based on the Phase 2 RFP and the Respondents' responses to the bidders' questions. Id. ¶¶ 61-63.
On September 17, 2020, Petitioners filed their three-count Petition with this Court. Count I requests a declaratory judgment that: (1) Cardi's proposal is disqualified, and/or (2) once further information concerning Phase 1 of the Project is released, the bidders would be allowed to submit new price proposals, and/or (3) the original Phase 2 RFP be cancelled and be reissued with information about the work performed in Phase 1. Id. ¶¶ 81-87. Count II requests injunctive relief enjoining the entire procurement process until all information pertaining to the work in Phase 1 is revealed. Id. ¶¶ 88-93. Count III requests a writ of mandamus compelling the Respondents to stop the procurement process, void all steps previously taken, disqualify Cardi's proposal, and/or cancel and reissue the Phase 2 RFP. Id. ¶¶ 94-97. Respondents filed their motion to dismiss this Petition on October 13, 2020. This Court now renders its decision.
II. Standard of Review
A. Rule 12(b)(1)
Rule 12(b)(1) of the Superior Court Rules of Civil Procedure permits a justice to dismiss a civil matter for "[l]ack of jurisdiction over the subject matter." A question of subject-matter jurisdiction may be raised at any time before judgment. State Loan Co. v. Barry, 71 R.I. 188, 189, 43 A.2d 161, 162 (1945). Likewise, "[a] challenge to subject-matter jurisdiction may not be waived by any party and may be raised at any time in the proceedings." Boyer v. Bedrosian, 57 A.3d 259, 270 (R.I. 2012) (quotation omitted). General Law 1956 § 8-2-14 provides that this Court
"shall have original jurisdiction of all actions at law where title to real estate or some right or interest therein is in issue … and shall have exclusive original jurisdiction of all other actions at law in which the amount in controversy shall exceed the sum of ten thousand dollars ($10,000); and shall also have concurrent original jurisdiction with the district court in all other actions at law in which the amount in controversy exceeds the sum of five thousand dollars ($5,000) and does not exceed ten thousand dollars ($10,000)[.]"
While the Rhode Island Superior Court is a court of general jurisdiction, it does not have subject-matter jurisdiction over all cases if such jurisdiction has been conferred by statute upon another tribunal. See Barone v. O'Connell, 785 A.2d 534, 535 (R.I. 2001). Additionally, while a court generally may not look outside the pleadings when evaluating a motion to dismiss, our Supreme Court has recognized that "[a] court may consider any evidence it deems necessary to settle the jurisdictional question" when it is deciding a Rule 12(b)(1) motion. Boyer, 57 A.3d at 270.
B Rule 12(b)(6)
"The sole function of a motion to dismiss is to test the sufficiency of the complaint." Palazzo v. Alves, 944 A.2d 144, 149 (R.I. 2008) (quotation omitted). Looking at the four corners of the complaint, this Court examines that pleading and assumes that the allegations contained in the plaintiff's complaint are true, viewing them in a light most favorable to the plaintiff. Barrette v. Yakavonis, 966 A.2d 1231, 1234 (R.I. 2009). Our Supreme Court has noted that there is a policy to interpret the pleading rules liberally so that "cases in our system are not . . . disposed of summarily on arcane or technical grounds." Konar v. PFL Life Insurance Co., 840 A.2d 1115, 1118 (R.I. 2004) (quotation omitted). While the pleading does not need to include the ultimate facts to be proven or the precise legal theory upon which the claims are based, the complaint is required to provide the opposing party with fair and adequate notice of any claims being asserted. Barrette, 966 A.2d at 1234.
The goal of a complaint is to give defendants sufficient notice of the type of claim being asserted against them. See Konar, 840 A.2d at 1119; see also Berard v. Ryder Student Transportation Services, Inc., 767 A.2d 81, 85 (R.I. 2001) (noting that the requisite notice under Rule 8 of the Superior Court Rules of Civil Procedure requires a plaintiff to allege what acts committed by the defendant entitle the plaintiff to legal or equitable relief). Accordingly, "[a] motion to dismiss is properly granted when it is clear beyond a reasonable doubt that the plaintiff would not be entitled to relief from the defendant under any set of facts that could be proven in support of the plaintiff's claim." Woonsocket School Committee v. Chafee, 89 A.3d 778, 787 (R.I. 2014) (quotations omitted).
Rule 8 states in pertinent part that "[a] pleading . . . shall contain (1) [a] short and plain statement of the claim showing that the pleader is entitled to relief, and (2) [a] demand for judgment for the relief the pleader seeks." Super. R. Civ. P. 8(a).
Respondents state they are bringing their motion to dismiss the Petition for failure to state a claim upon which relief can be granted under Rule 12(b)(6) and/or for lack of subject matter jurisdiction under Rule 12(b)(1). (Resp'ts' Mot. to Dismiss at 1.) Therefore, this Court will first discuss whether it has subject matter jurisdiction over the Petition and then address whether the Petitioners have sufficiently pled their claim for a pre-award action.
A. Subject-Matter Jurisdiction
The Respondents argue that this Court lacks subject-matter jurisdiction because the Petition is not ripe for adjudication. Specifically, they assert, through an affidavit by Everett Sammartino, RIDOT's Contracts and Specifications Administrator, that the selection of Cardi's bid for Phase 2 of the Project was only a "tentative selection," and the bid is undergoing a "post-qualification review process by RIDOT." Id. at 2-3; see also Sammartino Aff. ¶¶ 4-6. Further, Respondents contend that the selection of Cardi's bid has not been finalized because Section 10.1 of the "Request for Proposal #7603776" provides notice that the project is subject to funding or may be canceled or withdrawn. Id. at 2-3. Therefore, Respondents argue that the Petition is premature, based on speculation, and not legally ripe for this Court's review because Petitioners' requested relief is contingent upon an actual award to Cardi. Id. at 3-4.
Petitioners argue that this Court must "analyze ripeness in the context of a pre-award bid protest." (Hr'g Tr. 47:3-4, Nov. 19, 2020.) Petitioners assert that this Court has jurisdiction over a pre-award action because the State Purchases Act "ensure[s] that the bidding process is fair, competitive, and efficient." (Pet'rs' Obj. to Resp'ts' Mot. to Dismiss at 9.) Specifically, they argue that the State Purchases Act provides the statutory right to a "fair opportunity to bid intelligently," and the existence of that statutory right "necessitates the availability of relief when a deprivation of that right causes harm." Id. Petitioners assert that a liberal reading and application of the State Purchases Act demonstrates that the Legislature intended to protect Petitioners' statutory and substantive rights, of which the Petitioners have been deprived, and such deprivation resulted in a competitive injury. Id. at 10-11.
It is well settled that in order for this Court to exercise jurisdiction, there must be an "actual justiciable controversy." State v. Gaylor, 971 A.2d 611, 613 (R.I. 2009). "As a general rule, a claim is not ripe for adjudication if it rests upon 'contingent future events that may not occur as anticipated, or indeed may not occur at all.'" Id. at 614 (quoting Thomas v. Union Carbide Agricultural Products Co., 473 U.S. 568, 580-81 (1985)). Ripeness is a justiciability doctrine which seeks to avoid "premature adjudication." National Park Hospitality Association v. Department of the Interior, 538 U.S. 803, 807 (2003).
Section 37-2-2 of the State Purchases Act provides that the "chapter shall be liberally construed and applied to promote its underlying purposes[.]" This section goes on to list the "underlying purposes and policies" of the Act, five of which are to:
"(4) Provide for increased public confidence in the procedures followed in public procurement;
"(5) Insure the fair and equitable treatment of all persons who deal with the procurement system of the state;
"(6) Provide increased economy in state and public agency procurement activities by fostering effective competition;
"(7) Provide safeguards for the maintenance of a procurement system of quality, integrity and highest ethical standards; and
"(8) Ensure that a public agency, acting through its existing internal purchasing function, adheres to the general principles, policies and practices enumerated herein." Section 37-2-2(b).
Further, the Rhode Island Supreme Court has said that the primary goals of the State Purchases Act are "(1) protection of the public fisc by obtaining the best work at the lowest possible price; and (2) prevention of favoritism, improvidence, fraud and corruption in the awarding of public contracts." Associated Builders & Contractors of Rhode Island, Inc. v. Department of Administration, 787 A.2d 1179, 1187 (R.I. 2002) (quotation omitted).
In Bradford Associates v. Rhode Island Division of Purchases, 772 A.2d 485 (R.I. 2001), the Rhode Island Supreme Court held that the Superior Court lacked subject-matter jurisdiction over suit by two government contractors because "there is no statutory authority to review suspension decisions in either the [State] Purchases Act . . . or in the [Procurement] Regulations." Bradford Associates, 772 A.2d at 488. The Supreme Court decided that the only available remedy was to protest to the chief purchasing officer under § 37-2-52. Id. at 489. However, the Supreme Court held that the Superior Court had subject matter jurisdiction, under the Uniform Declaratory Judgment Act (UDJA), to adjudicate the general contractor's challenge to his suspension from work on government projects. Id. The Supreme Court reasoned that, because the UDJA vests in the Superior Court the "power to declare rights, status, and other legal relations," the Superior Court in that case had "jurisdiction to construe the rights and responsibilities of any party arising from a statute pursuant to the powers conferred upon the Supreme Court by" the UDJA. Id. (quotation omitted).
Here, as in Bradford Associates, Count I of the Petition seeks a declaratory judgment. This request confers upon the Court the ability to determine Respondents' "responsibilities" under the State Purchases Act. This is true because one such purpose of the Act is to "[i]nsure the fair and equitable treatment of all persons who deal with the procurement system of the state." Section 37-2-2(b)(5). In addition, the reasoning in Bradford Associates extends to Count II (which requests injunctive relief) and Count III (which requests a writ of mandamus) of the Petition. In Rhode Island Republican Party v. Daluz, 961 A.2d 287 (R.I. 2008), the Supreme Court held that the Superior Court had jurisdiction to grant or deny injunctive relief because it is a court of general jurisdiction. Rhode Island Republican Party, 961 A.2d at 295. Moreover, the Supreme Court in Chariho Regional School District v. Gist, 91 A.3d 783 (R.I. 2014), commented in a footnote that the Superior Court had subject matter jurisdiction over an action seeking a writ of mandamus pursuant to § 8-2-16, which this section simply states that "[t]he Superior Court . . . concurrently with the Supreme Court shall have jurisdiction of writs of . . . mandamus[.]" Chariho Regional School District, 91 A.3d at 786 n.4. The same reasoning in Bradford Associates-that the absence of an express statutory right did not prevent a party from seeking declaratory judgment under the UDJA-applies here to the injunctive relief and writ of mandamus sought by Petitioners, because the Superior Court has general jurisdiction over actions for injunctive relief and jurisdiction over actions seeking writ of mandamus pursuant to § 8-2-16. See Bradford Associates, 772 A.2d at 489.
Therefore, this Court has jurisdiction over Petitioners' pre-award action and denies Respondents' Motion to Dismiss pursuant to Rule 12(b)(1) of the Superior Court Rules of Civil Procedure.
B. Pre-Award Action
The Respondents next argue that Petitioners have failed to state a claim upon which relief can be granted pursuant to Rule 12(b)(6) because Petitioners' claim is not ripe for adjudication since Cardi's contract award has not been finalized.
Petitioners argue that they have put forth factual allegations in their Petition that they suffered the requisite "competitive injuries" for pre-award action because (1) Respondents' responses to the bidders' questions were false, and the JV relied on these responses for its proposal, and (2) due to Cardi having worked on Phase 1 of the Project, Cardi knew intimate and material information about the Project that the Respondents did not inform the other bidders of. (Pet'rs' Obj. to Resp'ts' Mot. to Dismiss at 3.) Thus, Petitioners contend, the competition amongst the bidders was not "equalized" due to Cardi's "substantial and unfair competitive advantage" and that this Court should recognize the "efficiency in addressing issues with a solicitation process as soon as possible." Id. at 3, 8.
Rhode Island courts have not discussed pre-award actions. However, both federal courts and other state courts have allowed parties to bring such an action See Ulstein Maritime, Ltd v United States of America, 833 F.2d. 1052, 1058 (1st Cir 1987) ("[T]he Claims Court and the district courts have equal, concurrent power to award injunctive relief in pre-award contract cases[.]"); see also Barr Inc. v. Town of Holliston, 967 N.E.2d 106, 108 (Mass. 2012) (ruling on a complaint seeking both declaratory judgment and injunctive relief that was filed in Superior Court prior to the award of the contract to the town).
Further, the Federal Claims Court has ruled that, in a pre-award action, "the requisite economic interest consists of 'a non-trivial competitive injury which can be redressed by judicial relief[, ]'" and that an "[i]nability to compete intelligently is undoubtedly a non-trivial competitive injury." See State of North Carolina Business Enterprises Program v. United States of America, 110 Fed.Cl. 354, 366 (2013) (quotation omitted). In State of North Carolina Business Enterprises Program, the Federal Claims Court stated that "as a general rule, a bidder has a right to a solicitation that permits the bidder 'to compete intelligently and on a relatively equal basis.'" Id. (quoting Glenn Defense Marine (Asia), PTE Ltd. v. United States, 97 Fed.Cl. 568, 578 (2011)). The Federal Claims Court went on to say that "[w]hen a bidder is denied its right to compete intelligently, its right to compete is thereby reduced, thus amounting to a non-trivial competitive injury." Id.
Here, the Petitioners have sufficiently pled that the JV had the "[i]nability to compete[, ]" which is the "requisite economic interest" that must be shown in a pre-award action. See id. at 366. Specifically, the Petition states that (1) Cardi had "intimate knowledge of the actual quantities of work in progress" not known to the other bidders because Cardi worked on Phase 1 of the Project; (2) the responses to the JV's questions about the quantity of work performed during Phase 1 turned out to be false, and the JV based its proposal on those responses; (3) Cardi's Price Proposal ended up being significantly lower than the JV's proposal because of the information Cardi knew; (4) the Respondents failed to equalize the competition by providing the material information to all bidders; and (5) the JV was "significantly disadvantaged" by the solicitation process. (See Petition ¶¶ 26, 20-21, 35, 43, 66.)
Respondents' sole argument is that Petitioners have failed to state a claim upon which relief can be granted because their claim is not ripe for adjudication. However, the decision in State of North Carolina Business Enterprises Program demonstrates that, at this stage of the proceedings, Petitioners are not required to demonstrate that they have suffered a competitive injury in order for this Court to consider the merits. See State of North Carolina Business Enterprises Program, 110 Fed.Cl. at 367. Based on the allegations put forth in the Petition, this Court holds that Petitioners have sufficiently pled that the JV was unable to compete and thus suffered the requisite injury. Therefore, this Court denies Respondents' Motion to Dismiss pursuant to Rule 12(b)(6) of the Superior Court Rules of Civil Procedure.
Because this Court denies their motion, the Respondents have requested that the Court stay this matter "until such a time that the facts giving rise to the Petitioner's [sic] claim are made certain." (Resp'ts' Mot. to Dismiss at 4). However, these referenced "facts" are certain now, in light of the nature of Petitioners' claim as a pre-award action. The Petition alleges that there has been an unfair solicitation process and alleges many facts as to how Petitioners have suffered a "competitive injury." Therefore, there is no reason for this Court to stay the matter.
Therefore, for the reasons stated above, this Court denies Respondents' Motion to Dismiss. Counsel shall submit an order consistent with this Decision.