[00:00:27] Speaker 04:
Mr. DeLisle, is that how you pronounce it?

[00:00:29] Speaker 04:
That's correct, Your Honor.

[00:00:31] Speaker 00:
I may please the Court.

[00:00:32] Speaker 00:
Edward DeLisle on behalf of Appellant National Recoveries, Incorporated.

[00:00:37] Speaker 00:
National Recoveries was awarded a contract for debt collection services in 2014.

[00:00:42] Speaker 04:
Let me ask you a question.

[00:00:44] Speaker 04:
Suppose in the other case we were to hold, ultimately, just hypothetically, that the District Court's second paragraph of the injunction about dilution

[00:00:57] Speaker 04:
should be reversed.

[00:00:59] Speaker 04:
Let's assume, hypothetically, we do that.

[00:01:02] Speaker 04:
Do you care what happens here?

[00:01:04] Speaker 04:
Is this case then moot?

[00:01:06] Speaker 00:
I love everyone here, but I do not care.

[00:01:08] Speaker 00:
The issue would be moot for my purposes, Your Honor.

[00:01:13] Speaker 00:
I mean, let's face it.

[00:01:15] Speaker 00:
The issue for national recoveries is, does it have the ability to defend its right to receive work under its pre-existing contract?

[00:01:24] Speaker 00:
That's what this is all about.

[00:01:25] Speaker 00:
And so if the court were to address the issue that, Your Honor, identified in that manner, well, it would seem to me that that would resolve that issue.

[00:01:35] Speaker 04:
That would be moved.

[00:01:36] Speaker 04:
Your case would be moved.

[00:01:38] Speaker 00:
Yes, Your Honor.

[00:01:39] Speaker 04:
Thank you.

[00:01:39] Speaker 04:
Yes.

[00:01:40] Speaker 00:
Shall I continue?

[00:01:41] Speaker 04:
Yes.

[00:01:43] Speaker 00:
I thought maybe I was done.

[00:01:46] Speaker 00:
So he had been successfully performing under that 2014 contract for over a year.

[00:01:54] Speaker 00:
receiving new work every single month, certainly as would have been identified in the spreadsheet that the court just reviewed, and had been doing so just as it had received new work every month for five years under its previous contract in 2009.

[00:02:10] Speaker 00:
And then suddenly, as we all know, based upon the protests and the underlying case here, which relate to a separately procured set of contracts for the same type of work, everything stopped.

[00:02:25] Speaker 00:
This broad, all-encompassing preliminary injunction in the underlying case here not only prevented the Department of Education from issuing work to those vying for awards through the separately procured contracts, but it also stopped education from awarding work to pre-existing separately awarded contracts, including that which was held by my client, National Recoveries.

[00:02:49] Speaker 00:
So of course, National Recoveries, in an effort to protect its

[00:02:53] Speaker 00:
rights under its pre-existing contract attempted to intervene and the Court of Federal Claims denied that request for intervention on the grounds that national recoveries had no legally protectable interests because it's contract only.

[00:03:06] Speaker 03:
What's our standard to review in the denial of a motion to intervene as a matter of right?

[00:03:10] Speaker 00:
It's actually a good question because it's not been determined specifically.

[00:03:15] Speaker 00:
Our position is that it's de novo.

[00:03:17] Speaker 00:
There are no facts in dispute here.

[00:03:19] Speaker 00:
I don't think anyone

[00:03:22] Speaker 00:
While there's a dispute from my adversary, he believes it's abuse of discretion.

[00:03:27] Speaker 00:
Quite frankly, I don't know that the result should be any different.

[00:03:30] Speaker 00:
Our position is, because there are no facts in dispute, that it should be a de novo standard.

[00:03:37] Speaker 00:
So what Judge Braden decided to do in the underlying case was deny our ability to intervene because she determined that we did not have a legally protectable interest

[00:03:46] Speaker 00:
And that, in fact, we had no interest in the action because any judgment in the case would not affect our ability to receive new work at some point later in time.

[00:03:55] Speaker 00:
And by reaching that conclusion, she was effectively stating that we had failed to satisfy the first prong of Rule 24's three-pronged test that must be satisfied to successfully intervene.

[00:04:07] Speaker 00:
And of course, we believe that the court hears.

[00:04:11] Speaker 00:
And for purposes of reaching a decision in this case, our position is the court should consider four cases.

[00:04:17] Speaker 00:
We cite to others, but there are four primary.

[00:04:20] Speaker 00:
Two Federal Circuit cases.

[00:04:21] Speaker 03:
We have the government and we have other appellants in the related litigation already seeking to lift the preliminary injunction.

[00:04:28] Speaker 03:
So what's your separate interest?

[00:04:32] Speaker 00:
Our interest, your honor, is to protect our right to receive work.

[00:04:39] Speaker 00:
Our belief is the over-broad nature of the underlying preliminary injunction is preventing us and other small businesses that are similarly situated from receiving work that we would otherwise receive under our contract.

[00:04:51] Speaker 04:
Your answer is there's no small business in the case unless you're allowed to intervene, right?

[00:04:57] Speaker 00:
That would be true.

[00:04:58] Speaker 00:
That's correct, Your Honor.

[00:04:59] Speaker 01:
Why is the government not an adequate representative of your interests given that the government is making the allocation decisions and

[00:05:07] Speaker 01:
At least as a general matter, you don't have much entitlement to force the government to give you accounts.

[00:05:17] Speaker 00:
And that is all true.

[00:05:18] Speaker 00:
And I would say two things, John.

[00:05:20] Speaker 00:
First, the history is belies the notion that we wouldn't receive understanding where your honor is coming from.

[00:05:27] Speaker 01:
But I'm asking, I guess specifically about the, is there an adequate representation component to this?

[00:05:32] Speaker 00:
As Your Honor pointed out, at least presently, the Department of Justice has been advocating a position that would be advantageous to national recoveries.

[00:05:42] Speaker 00:
That part is true.

[00:05:43] Speaker 00:
To the extent that this litigation perpetuates, we have no idea to what extent the Department of Justice will continue to advocate on behalf of small business.

[00:05:53] Speaker 00:
We just don't.

[00:05:55] Speaker 00:
I point, Your Honors, to the Northrop Grumman case, Judge Block's Court of Federal Claims case from 2006.

[00:06:02] Speaker 00:
where he took the position that, look, the showing for adequate representation for prospective intervener is small.

[00:06:10] Speaker 00:
If it can show that there is some divergence or could be some divergence between other counsel in the case and the position that the prospective intervener would take, it's enough.

[00:06:24] Speaker 00:
Our position on that would be, and it wasn't decided by Judge Braden, while right now the Department of Justice has, in fact, been taking

[00:06:31] Speaker 00:
a position that would be advantageous to us.

[00:06:34] Speaker 00:
The issues that the Department of Justice is dealing with in the underlying litigation is vast.

[00:06:41] Speaker 00:
If you take a look at the briefing that was filed by the Department of Justice, for example, the reference to small business is very small.

[00:06:49] Speaker 00:
The brief is very long, and it's a very small piece, I guess the best way to put it, of a very large problem.

[00:06:58] Speaker 00:
So what we are concerned with is that our problem will be lost in the mix of all these other issues that would have to get litigated if this thing were to perpetuate.

[00:07:10] Speaker 00:
So the four cases, you have two Federal Circuit cases and you have two Court of Federal Claims cases.

[00:07:15] Speaker 00:
And the two Federal Circuit cases that were referenced by the parties are of somewhat limited value, but one is more instructive than the other.

[00:07:24] Speaker 00:
The two are American Maritime Transportation and Freedom Wireless.

[00:07:28] Speaker 00:
The two, Court of Federal Claims cases, Armor of America, Judge Damage's case, and Northrop Grumman, which I mentioned earlier, it's Judge Block's case.

[00:07:37] Speaker 00:
We think those are very important as they get much more detail with respect to the whole issue of intervention and when it should be permissible.

[00:07:45] Speaker 00:
But let's start very quickly with American Maritime.

[00:07:48] Speaker 00:
It's a 1989 Federal Circuit case.

[00:07:51] Speaker 00:
And I submit to the panel that the facts of that case are such that it is of limited

[00:07:58] Speaker 00:
value in evaluating our case.

[00:08:02] Speaker 00:
It's a case about shipping subsidies and a contractor that got into a dispute with the government over whether these shipping subsidies should have been provided.

[00:08:12] Speaker 00:
The intervener was a competitor and wanted to participate in the lawsuit because it feared that if American maritime prevailed, that the intervener would be facing stiffer competition at some point indefinitely in the future, maybe.

[00:08:26] Speaker 00:
The Federal Circuit stated that, you know, fear of future subsidized competition which may never arise does not reflect an interest in the property or transaction at issue in this action.

[00:08:37] Speaker 00:
Not a surprise given the facts of that case.

[00:08:40] Speaker 00:
The facts of this case are very different.

[00:08:44] Speaker 00:
The facts of this case are such that we are getting no contracts at this time and we are not permitted to get, excuse me,

[00:08:51] Speaker 00:
We are not getting transfers.

[00:08:52] Speaker 00:
We are getting no additional new work because of the injunction that's in place.

[00:08:57] Speaker 00:
So there's not some indefinite, indirect, or contingent harm or interest.

[00:09:05] Speaker 00:
Our interest is very direct at the present moment unless the Federal Circuit decides to act otherwise.

[00:09:11] Speaker 00:
So very different.

[00:09:13] Speaker 00:
In fact, Judge Block, in finding for intervention in the Northrop case, did exactly what we're suggesting here, which is distinguish

[00:09:21] Speaker 00:
American Maritime from the facts of that case.

[00:09:26] Speaker 00:
And I'll get to that in a moment.

[00:09:27] Speaker 00:
The other case that's instructive, we think more so than American Maritime, is Freedom Wireless and for this reason.

[00:09:34] Speaker 00:
It was an infringement case between Freedom Wireless and Boston Communications.

[00:09:39] Speaker 00:
After the action was initiated, a non-party Nextel entered into a contract with Boston Communications.

[00:09:46] Speaker 00:
An injunction was then issued, which Nextel felt impacted its contract rights with Boston Communications, and so it filed a motion in May.

[00:09:53] Speaker 00:
In Freedom Wireless, this court took the position that it appeared that Nextel had a legally protectable interest relating to the injunction, and why is that important?

[00:10:02] Speaker 00:
It's important because in that instance, or that was an instance where a contract right was being impacted by an injunction in a separate matter, and that contract constituted a legally protectable

[00:10:16] Speaker 00:
interest.

[00:10:17] Speaker 00:
That's what we're trying to protect here, our contract rank.

[00:10:22] Speaker 00:
Quickly going to the two cases we think are very important, Armour of America and Northrop Grumman.

[00:10:28] Speaker 00:
Both are important because they get into so much detail with respect to when intervention should be permissible.

[00:10:35] Speaker 00:
Both cases involve non-parties that wish to intervene to protect their disclosure or the disclosure of proprietary information and in both cases intervention was permitted.

[00:10:46] Speaker 00:
In both cases, the court determined that the non-party had a legally protected interest in the proprietary information.

[00:10:53] Speaker 00:
And NRI submits that it has a legally protected interest in its contract and its ability to receive work from that contract, as it had been receiving for more than a year prior to the preliminary injunction.

[00:11:04] Speaker 00:
And we simply wish to intervene to protect that interest, just as Nextel was permitted to do in the Freedom Wireless case.

[00:11:11] Speaker 00:
And it should not have been a leap.

[00:11:13] Speaker 00:
for the Court of Federal Claims to do because, as Judge Block pointed out in Northrop Grumman, satisfying the legally protectable interest issue is, quote, not a very high barrier, end quote.

[00:11:24] Speaker 00:
That's at page 144 of the opinion.

[00:11:30] Speaker 00:
Neither Armour of America nor Northrop Grumman, the facts in those cases were such that the intervener in both cases

[00:11:42] Speaker 00:
had no interest in the ultimate outcome of the case, yet intervention was allowed anyway.

[00:11:48] Speaker 00:
And as Judge Damage pointed out in Armor of America, although the Federal Circuit has not clarified the meaning of the term action, as that term is used in Rule 24, other courts have chosen not to limit the term to the case as a whole, but instead have expanded the definition to encompass collateral issues in the suit.

[00:12:09] Speaker 00:
And we're suggesting that that's precisely what should occur

[00:12:12] Speaker 00:
here.

[00:12:13] Speaker 00:
So Pellant was unwittingly dragged into the underlying matter here and simply desires the right to intervene if it's necessary.

[00:12:22] Speaker 00:
At this juncture, it still is.

[00:12:25] Speaker 04:
Okay.

[00:12:26] Speaker 04:
Thank you, Mr. Long.

[00:12:43] Speaker 02:
Your honors, Alex Ginsburg for Continental, the appellee.

[00:12:48] Speaker 02:
Your honors, unlike perhaps the other appeal you heard in the consolidated cases a bit earlier, this appeal is extremely simple.

[00:12:59] Speaker 02:
And let me cut to the chase.

[00:13:00] Speaker 02:
This appeal fails for one reason alone, which is the NRI does not have a legally protectable interest under the test required by this circuit.

[00:13:14] Speaker 02:
elaborate on that.

[00:13:16] Speaker 02:
As was not disputed at any point during this appeal or during the case below, the Department of Education does not reserve pools of accounts for a particular contractor or set of contracts.

[00:13:31] Speaker 02:
And in other words, there is no contract right.

[00:13:34] Speaker 04:
An expectation that in the normal course you will receive business isn't sufficient?

[00:13:40] Speaker 02:
Your Honor, there is no case that would hold that.

[00:13:44] Speaker 02:
Every case cited by the appellant here is distinguishable and, more importantly, very clearly holds, and I can go into each of them, that intervention can be granted when there's a proprietary interest or a significant contract right to protect.

[00:14:05] Speaker 02:
And here there is no such right.

[00:14:06] Speaker 02:
And the appeal fails for that reason alone.

[00:14:09] Speaker 02:
Is it the same thing as standing?

[00:14:12] Speaker 02:
Your honors, I think it's extremely similar to standing.

[00:14:14] Speaker 02:
That is not the language of the cases.

[00:14:16] Speaker 02:
They analyze rule 24, but I think essentially what they're analyzing is statutory standing.

[00:14:22] Speaker 01:
Well, why is there not a contract right to have the Department of Education make its allocation, account allocation decision free of the kind of constraint that has been imposed by the injunction right now?

[00:14:41] Speaker 01:
that would preclude the department from exercising that discretion?

[00:14:49] Speaker 02:
I think, Your Honor, the simple answer to that is there is no right in NRIs or any of the small business contracts to any amount of transfers.

[00:15:00] Speaker 02:
And there may be a separate problem here in terms of the arbitrariness with which the Department of Education has administered these contracts, but the bottom line is these are

[00:15:10] Speaker 02:
indefinite quantity, indefinite delivery contracts with minimal minimums.

[00:15:16] Speaker 02:
And there is no set right to any of the account transfers that NRI is saying it's lost.

[00:15:25] Speaker 04:
Well, they have a right to a $1,000 minimum, right?

[00:15:28] Speaker 04:
I believe that's correct, Your Honor.

[00:15:29] Speaker 02:
And they're not getting that, right?

[00:15:31] Speaker 02:
Your Honor, if that is all that NRI seeks, I assume something could be worked out.

[00:15:39] Speaker 04:
But it's certainly enough to give them a standing, right?

[00:15:44] Speaker 02:
Your Honor, I mean, I think that the cases will tell us, and actually the test itself, and I'm quoting Wolfson versus Pacific Coast.

[00:15:51] Speaker 02:
Unlike the, what is it called, the Freedom Wireless case that appellant relies on heavily, which is an unpublished decision from this court, Wolfson and the case that it cites, that being American Maritime, that's the controlling precedent here.

[00:16:09] Speaker 02:
And the second prong of the relevant test is that the movement must claim some interest in the property affected by the case.

[00:16:19] Speaker 02:
The interest must be, quote, legally protectable, and merely economic interests will not suffice.

[00:16:24] Speaker 02:
And we could parse the definition of merely economic, but $1,000 de minimis minimum doesn't seem to be outside the scope of merely economic.

[00:16:34] Speaker 02:
The cases that found a right to intervene focused on

[00:16:39] Speaker 02:
significant intellectual property rights, the protection of proprietary information that could have a key lasting impact on the future of the company, and those sorts of economic rights.

[00:16:50] Speaker 02:
And that's pervasive throughout these decisions.

[00:16:52] Speaker 03:
But in all these cases, isn't their only interest really dealing with economic in nature?

[00:16:59] Speaker 02:
They are economic, but not merely economic, or I should say not a matter of a mere economic interest.

[00:17:07] Speaker 03:
We're not dealing with IP interest or any other thing like that.

[00:17:12] Speaker 02:
I think most of these cases are dealing with IP interests, in fact.

[00:17:15] Speaker 02:
But it's whether or not these companies or these would-be interveners have a proprietary interest, often an IP interest, in the actual property in question.

[00:17:27] Speaker 04:
There are plenty of cases where

[00:17:29] Speaker 04:
people have challenged bid awards because of the expectation that they would succeed if the thing were rebid.

[00:17:36] Speaker 04:
And that's been held to create standing.

[00:17:38] Speaker 04:
So standing and intervention, as you seem to agree, were the same thing.

[00:17:43] Speaker 04:
This would pretty clearly fall within those cases.

[00:17:45] Speaker 02:
Your Honor, a great point.

[00:17:46] Speaker 02:
And I should note, by the way, just to backtrack for one second, that we believe that the $1,000 minima have been met in an NRI's case and the small businesses cases.

[00:17:57] Speaker 02:
In any case, to your point,

[00:17:59] Speaker 02:
It is true that the common intervener in a bid protest is the purported or putative awardee.

[00:18:08] Speaker 02:
And that's another key fact here because NRI has not been involved in any way in this procurement, the one that's subject to the underlying protest and now this appeal.

[00:18:18] Speaker 02:
NRI's contract was not procured as a result of this 2016 competition.

[00:18:23] Speaker 02:
They weren't an awardee.

[00:18:24] Speaker 02:
They weren't even an offeror in the procurement.

[00:18:27] Speaker 02:
And that's the key distinction.

[00:18:29] Speaker 02:
And that actually gets to part two, or part three, I should say.

[00:18:32] Speaker 04:
The injunction prevents them from getting business that they'd otherwise get, right?

[00:18:38] Speaker 04:
Your Honor, I think you heard a whole description of the... Isn't that true?

[00:18:43] Speaker 04:
Isn't it true that the injunction... That the injunction deprives them of business that they would otherwise get in the normal course.

[00:18:50] Speaker 02:
I think the facts would say that it has enjoined them from getting new account transfers, but again, they are not legally entitled to those.

[00:18:58] Speaker 02:
absent the injunction they'd be getting additional accounts, right?

[00:19:02] Speaker 02:
Only Ed could say that, the Department of Education.

[00:19:04] Speaker 02:
I mean, again, no legal entitlement.

[00:19:07] Speaker 02:
The Department of Education has said they would get the accounts if the injunction didn't exist.

[00:19:13] Speaker 02:
Right.

[00:19:13] Speaker 02:
Your Honor, I think that is true.

[00:19:15] Speaker 02:
It would still say there was no legally protectable interest in those accounts because there's no contract right to those accounts.

[00:19:22] Speaker 02:
And again, as you heard before,

[00:19:25] Speaker 02:
They can continue to process the accounts that they already possess.

[00:19:29] Speaker 02:
It's just a question of receiving new accounts in the short term while Ed completes its corrective action.

[00:19:34] Speaker 02:
And also, again, Continental is not responsible for the government's delay in completing that corrective action.

[00:19:43] Speaker 02:
In any case, I'm happy to answer more questions.

[00:19:45] Speaker 02:
I think we probably all know that the test says, again, its mere economic interests are not sufficient.

[00:19:53] Speaker 02:
And then the third prong of the relevant test

[00:19:55] Speaker 02:
is that the interest relationship to the litigation must be of such a direct and immediate character that the intervener will either gain or lose by the direct legal operation and effect of the judgment.

[00:20:08] Speaker 02:
And as I mentioned before, NRI's contract is not a part of this procurement.

[00:20:14] Speaker 02:
And the effect of the bid protest will have no impact on NRI's contract.

[00:20:20] Speaker 02:
So really, the third prong of this test isn't met either.

[00:20:23] Speaker 02:
So again, no legally protectable interest can satisfy prong two of the relevant test.

[00:20:29] Speaker 02:
And also, because the contract is not the subject of this litigation, there's no direct and immediate impact of the litigation on NRI's contract.

[00:20:38] Speaker 02:
And certainly, I understand your point, Judge Dyke.

[00:20:41] Speaker 02:
I mean, their contract has been temporarily paused in terms of receiving new accounts, but the contract is still in place.

[00:20:49] Speaker 02:
And as soon as ED completes its corrective action, they're free to move on with it.

[00:20:54] Speaker 02:
And again, if you look at all the cases cited by both parties, but I'll focus on the one cited by NRI, the common thread in all these cases, that being Northrop Grumman, Freedom Wireless, Armor of America, and everything else they cite, the common thread is that in each case there was a legally protectable interest.

[00:21:15] Speaker 02:
And that doesn't exist here for the reasons we discussed.

[00:21:22] Speaker 02:
And Your Honor, I want to make one further point, is that if this court determines that prongs two and three of the relevant tests are met, what the court should do is remand for a determination of whether the government's interest was sufficient to protect NRI.

[00:21:38] Speaker 02:
The government argued on behalf of NRI's position throughout, as did other appellants in these cases, including Altran, both said that the injunction should be lifted as to the small businesses.

[00:21:49] Speaker 02:
That is 100% of NRI's interest.

[00:21:53] Speaker 02:
and sufficient to protect them here.

[00:21:56] Speaker 02:
Okay.

[00:21:56] Speaker 02:
Thank you, Mr. Hueser.

[00:21:59] Speaker 04:
Mr. DeLisle, do you have anything further?

[00:22:02] Speaker 00:
Yes, thank you.

[00:22:03] Speaker 00:
Just very briefly.

[00:22:07] Speaker 00:
This notion that there's been no impact on NRI's contract, which I just heard and it was in the briefing, is completely untrue, as we all know, but it's not just based on the obvious.

[00:22:20] Speaker 00:
We have not been receiving placements since this preliminary injunction was in place, but we also can't get this time back.

[00:22:27] Speaker 00:
So we haven't received any new work for, let's call it six months.

[00:22:32] Speaker 00:
That six months is gone.

[00:22:34] Speaker 00:
And the longer this continues, the more time is lost, the more opportunity is lost to national recoveries.

[00:22:40] Speaker 00:
So there is something very tangible at stake here, and it's very important that that gets taken into consideration as part of this.

[00:22:47] Speaker 03:
That's assuming you would get the work.

[00:22:48] Speaker 03:
Under an IDIQ contract, there's no guarantee, right?

[00:22:53] Speaker 00:
It's true that there is no guarantee.

[00:22:55] Speaker 00:
Our position is that the history belies the fact that we would not receive additional placements as we have since 2009.

[00:23:04] Speaker 00:
Every month since 2009, National Recoveries has received new work every single month.

[00:23:10] Speaker 00:
So I understand your point, Your Honor, but the history would belie the

[00:23:15] Speaker 00:
the fact that that would not occur.

[00:23:20] Speaker 00:
Any further questions?

[00:23:22] Speaker 04:
Thank you, Mr. Doyle.

[00:23:23] Speaker 04:
Thank you both, counsel.

[00:23:24] Speaker 04:
The case is submitted.

[00:23:25] Speaker 04:
That does not conclude our session today.

[00:23:27] Speaker 04:
The court will recess briefly.

[00:23:33] Speaker 04:
Okay, in the first continental case, number 1721-55, the court is determined to stay

[00:23:43] Speaker 04:
pending appeal the second part of the District Court of Federal Claims preliminary injunction which has been referred to colloquially in this discussion as the dilution provision and we will issue a formal order to that effect either later today or Monday but the stay is effective immediately and

[00:24:11] Speaker 04:
If there are no questions about that, I don't think we have anything further.

[00:24:16] Speaker 04:
Does Council have any questions?

[00:24:17] Speaker 04:
Yes.

[00:24:18] Speaker 04:
Your Honor, just to clarify, so problem one, halting the awardees remains in effect?

[00:24:22] Speaker 04:
Remains in effect for the time being.

[00:24:26] Speaker 04:
Any further questions?

[00:24:27] Speaker 04:
Okay.

[00:24:28] Speaker 04:
Thank you all, Council.

[00:24:29] Speaker 04:
That concludes our session for this morning.

[00:24:33] Speaker ?:
All rise.