2008 WI App 103
court of appeals of
published opinion
Case No.: |
2007AP476 |
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Complete Title of Case: |
†Petition For Review Filed |
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PRN Associates LLC and PGN Associates LLC,
Plaintiffs-Appellants,† v. State of
Defendant-Respondent. |
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Opinion Filed: |
June 18, 2008 |
Submitted on Briefs: |
February 14, 2008 |
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JUDGES: |
Brown, C.J., |
Concurred: |
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Dissented: |
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Appellant |
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ATTORNEYS: |
On behalf of the plaintiffs-appellants, the cause was
submitted on the briefs of Joseph R. Cincotta of Law Offices of Joseph R. Cincotta, |
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Respondent |
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ATTORNEYS: |
On behalf of the defendant-respondent, the cause was submitted on the brief of Richard E. Braun, assistant attorney general, and J.B. Van Hollen, attorney general. |
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2008 WI App 103
COURT OF APPEALS DECISION DATED AND FILED June 18, 2008 David R. Schanker Clerk of Court of Appeals |
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NOTICE |
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This opinion is subject to further editing. If published, the official version will appear in the bound volume of the Official Reports. A party may file with the Supreme Court a petition to review an adverse decision by the Court of Appeals. See Wis. Stat. § 808.10 and Rule 809.62. |
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Appeal No. |
2007AP476 |
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STATE OF |
IN COURT OF APPEALS |
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PRN Associates LLC and PGN Associates LLC,
Plaintiffs-Appellants, v. State of
Defendant-Respondent. |
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APPEAL
from orders of the circuit court for
Before
Brown, C.J.,
¶1
¶2 In the fall of 2002, University of Wisconsin-Milwaukee
initiated the issuance of a Request for Proposal (First RFP) to renovate the
¶3 Prism submitted the winning response to the First RFP. Before the State could begin contract negotiations with Prism, the UW-System and the State Building Commission (SBC) had to approve Prism’s response. On September 5, 2003, the UW-System gave its approval. UWM’s request for SBC approval was filed, but it was withdrawn on February 18, 2004, before final action was taken.
¶4 After UWM withdrew its request for SBC approval, the SBC ordered that a second Request for Proposal be issued for the project. (Second RFP). Responses were due by May 14, 2004. Prism submitted a response. However, WEAS Development submitted the winning proposal.
¶5 Both the UW-System and the SBC approved the WEAS proposal. On February 3, 2005, the Wisconsin Department of Administration (DOA) sent a letter to Prism advising that the contract was going to be awarded to WEAS.
¶6 Prism protested the decision to award the contract to WEAS and appealed the denial of the protest to the DOA. That led to the issuance of an administrative decision in favor of the State, dated June 6, 2005.
¶7 On July 6, 2005, Prism commenced this case with the filing of a petition in the circuit court for Ozaukee county, case No. 2005CV312. The State responded with a motion to dismiss.
¶8 The State’s dismissal motion was briefed and argued. On September 21, 2006, the circuit court found Prism’s claims were moot and dismissed the case. The dismissal order was entered on October 17, 2006.
¶9 On October 13, 2006, Prism filed a motion for reconsideration. That motion was also briefed and argued. The circuit court denied the motion to reconsider in a decision rendered on November 27, 2006. The order was entered on January 17, 2007. Prism filed its notice of appeal on February 22, 2007.
¶10 Prism makes several arguments on appeal and requests remand for a damages determination. The circuit court correctly determined Prism’s case is moot; we discuss only the pertinent law and reasoning.
¶11 We begin with a discussion of the standard of review. This case is before us in the context of a
motion to dismiss. A motion to dismiss
tests the legal sufficiency of the plaintiff’s complaint. Doe v. Archdiocese of
¶12 The scope of appellate review of an agency decision is
identical to that given by statute to the circuit court. Gilbert v. State Med. Examining Bd.,
119
The court shall remand the case to the agency for further action if it finds that either the fairness of the proceedings or the correctness of the action has been impaired by a material error in procedure or a failure to follow prescribed procedure.
¶13
The court shall set aside or modify the agency action if it finds that the agency has erroneously interpreted a provision of law and a correct interpretation compels a particular action, or it shall remand the case to the agency for further action under a correct interpretation of the provision of law.
¶14 In addition, Wis. Stat. § 227.57(8) instructs:
The court shall reverse or remand the case to the agency if it finds that the agency’s exercise of discretion is outside the range of discretion delegated to the agency by law; is inconsistent with an agency rule, an officially stated agency policy or a prior agency practice, if deviation therefrom is not explained to the satisfaction of the court by the agency; or is otherwise in violation of a constitutional or statutory provision; but the court shall not substitute its judgment for that of the agency on an issue of discretion.
¶15 The usual deference accorded an administrative agency’s
interpretations of statutes or administrative rules is well known and need not
be discussed here.[2] A reviewing court will only interfere with a
bidding authority’s discretionary act if it is arbitrary or unreasonable.
¶16 A case is moot when the determination sought cannot have any
practical effect upon an existing controversy.
¶17 Here, the contract has been awarded and no injunction was filed
to prevent this. The circuit court
relied on the reasoning of four cases in holding the matter to be moot under
these circumstances. See D.M.K.,
Inc. v. Town of
¶18 Each of the relevant cases involved a municipal
procurement. Prism argues that because
none of the cases involved a state procurement they are all
distinguishable. Prism cites no
authority for this argument and we are not persuaded. First, none of the holdings in the four cases
confine themselves to the specific procurement statutes involved, indeed the
specific statutes are minimally mentioned in the decisions. We agree with the State that it is the
rationale of the four decisions that is important. Each of the decisions holds that the public
procurement statutes are intended primarily for the benefit and protection of
the public, not the individual bidder and the individual bidder has no fixed,
absolute right to the contract. Aqua-Tech,
71
¶19 In Aqua-Tech, the supreme court held: “[A] temporary injunction prohibiting the [procuring
body] from awarding the contract pending a disposition on the merits of [a]
claim appears to be required to avoid rendering ineffective a possible
judgment in [the challenging party’s] favor.” See Aqua-Tech, 71
¶20 In addition, even if Prism had timely sought and obtained
injunctive relief, which it did not, the court cannot order the contract to be
awarded to Prism or to any other bidder for that matter. See id. at 551-52. The court can enjoin the award of a contract
(an available option if the contract has not already been awarded), in
which case the procuring body can either let the contract to the bidder who
successfully challenged the initial award decision, or it can call for new bids
on the procurement.
¶21 In short, the court could not have ordered the state agency to award the contract to a particular party; furthermore, Prism, in order to preserve a possible judgment in its favor, was required to ask the court for injunctive relief before the agency’s awarding of the contract. See id.
¶22 We next address the damages issue, which is intertwined with
the above dispositive procedural issue.
In the recent decision D.M.K., we concluded that the
supreme court’s decision in Aqua-Tech regarding a disappointed
bidder’s available remedies is not dicta.
See D.M.K., 290
¶23 In D.M.K., we pointed out that the supreme
court’s conclusions in Aqua-Tech regarding an injunction as a
remedy, along with the unavailability of lost profits as damages, reflect a
consideration of the public policy rationale underlying the competitive bidding
statutes. See D.M.K., 290
By the Court.—Orders affirmed.
[1] All references to the Wisconsin Statutes are to the 2005-06 version unless otherwise noted.
[2] The
degrees of deference accorded administrative interpretations of statutes and
conclusions of law are great deference, due-weight and de novo review, or no
deference. Telemark Dev., Inc. v. DOR,
218