More of the Same: Air Force Prevails Over Another Insourcing Challenge

Over the last few years, we have followed DOD insourcing initiatives and how contractors have attempted to challenge agency insourcing decisions.   Many of the recent challenges have been lodged before the Court of Federal Claims (COFC) under the Tucker Act (28 USC § 1491) with little success.  Now the Court of Appeals for the DC Circuit weighs-in on this ongoing saga in Fisher-Cal Industries, Inc. v. United States (Apr. 8, 2014).  Appealing the District Court’s decision, Fisher-Cal argued that that the Air Force violated the Administrative Procedures Act when it decided to insource the parties’ contract instead of renewing it – specifically the Air Force failed to perform a proper cost comparison analysis under 10 USC §§ 129a and 2463.  Unsurprisingly, the DC Circuit affirmed the lower court’s dismissal of the claim for lack of jurisdiction.  Following the Federal Circuit’s lead, the DC Circuit found that the COFC has exclusive jurisdiction under the Tucker Act to entertain an insourcing challenge because it fits within the definition of a “procurement” under 28 USC § 1491(b)(1).  As this decision confirms, any contractor challenging an insourcing decision must focus its efforts before the COFC.