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BSP DIV. OF ENVIROTECH CORP. v. UNITED STATES EPA

June 1, 1979

BSP DIVISION OF ENVIROTECH CORPORATION, Plaintiff,
v.
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, Region II, Eckardt C. Beck,Regional Administrator, Turner Construction Co., Zimpro, Inc., and Passaic Valley Sewerage Commissioners, Defendants



The opinion of the court was delivered by: STERN

Plaintiff, BSP, a prospective supplier of part of an EPA-funded waste water treatment facility, brings suit under the Administrative Procedure Act, 5 U.S.C. § 701 Et seq., to set aside a decision of the Environmental Protection Agency (EPA) dismissing BSP's bid protest on procedural grounds. *fn1" BSP claimed in its bid protest that the contract specifications were anticompetitive because they called for equipment which was proprietary to BSP's competitor Zimpro, Inc. *fn2" Rather than ruling on the merits of this claim, the EPA dismissed the bid protest as untimely and held further that BSP was estopped in its protest because it had earlier raised and then abandoned the same claim. We uphold the decision of the EPA and grant summary judgment in favor of the defendants.

The Federal Water Pollution Control Act, 33 U.S.C. § 1251 Et seq. (FWPCA) provides for the cessation of ocean disposal of sewage sludge no later than December 31, 1981. *fn3" 33 U.S.C. § 1412a(a). The Act further authorizes the EPA to award grants to any public agency to cover 75% Of the cost of constructing waste treatment facilities which Inter alia provide for alternative ways to dispose of sludge. *fn4" 33 U.S.C. § 1281 Et seq. On June 30, 1976, the EPA awarded the Passaic Valley Sewerage Commission (PVSC) *fn5" $ 290,841,697.00 or 75% Of the total cost of constructing a secondary waste water treatment facility on the Passaic River. *fn6"

 An essential part of this facility is the Thermal Sludge Conditioning System which is designed to treat sludge with heat and pressure. Pursuant to the FWPCA, See 33 U.S.C. § 1283(a), PVSC submitted specifications for this system for the EPA's approval. The EPA expressed concern that the treatment process called for in the specifications was proprietary to Zimpro and therefore uncompetitive, and it ordered substantial revision of the specifications. (Adm.Rec. tab 2). In exchange, however, the specifications required that the supplier of the system have five years prior experience or, in lieu thereof, that it post an experience bond. The EPA approved the specifications on April 19, 1977. CCTW&M v. EPA, supra, at 71-74

 BSP's 1977 Protest and the CCTW&M Action

 In July 1977, following the EPA's approval of the contract specifications, BSP lodged a bid protest with PVSC, *fn7" arguing that the contract specifications, although revised, were still proprietary to Zimpro. Specifically, BSP argued that (1) the process contemplated by the specifications was patented by Zimpro, (2) the high-pressure pumps required by the specifications are manufactured and sold only by Zimpro, and (3) the experience requirement was drawn so that only Zimpro could qualify. (Adm.Rec. tab 4). In August 1977, BSP met with representatives of PVSC and the contract specifications were again revised. *fn8" Apparently, BSP was satisfied that the specifications were no longer proprietary for it immediately abandoned this claim. (Exh. P-R).

 Thereafter, BSP still pressed its protest but on other grounds. It focused Solely upon the experience requirement and the bond alternative. BSP argued that only Zimpro possessed the requisite experience and that the bond alternative was so onerous that it was not in fact an alternative at all. BSP claimed that the combined effect of these requirements was to stifle competition to the benefit of Zimpro. (Exh. P-R; Adm.Rec. tab 10).

 On September 2, 1977, PVSC denied BSP's protest (Adm.Rec. tab 14), and BSP immediately sought review with the EPA. (Adm.Rec. tab 15). In the meantime, however, bids were submitted and, on September 9, 1977, PVSC opened them. Of the five bids all of which named Zimpro as the supplier the bid of CCTW&M was the lowest. *fn9" CCTW&M v. EPA, supra, at 73-74.

 On December 10, 1977, the EPA issued a written decision, substantially agreeing with BSP that the experience requirement and bond alternative were anti-competitive. It ordered PVSC to revise the specifications and readvertise the contract. Id.

 CCTW&M and Zimpro thereafter sought judicial review of the EPA's decision. This Court found that the decision had a rational basis and awarded summary judgment to the EPA. See CCTW&M v. EPA, 452 F. Supp. 69 (D.N.J.1978).

 The specifications were thereafter revised and bidding began anew.

 BSP's 1978 Protest and the Present Action

 The revised specifications were readvertised on July 26, 1978. Bids were submitted on August 30, 1978. They were as follows:

 TABLE


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