19-002741BID Abacode, Llc And Zerofox, Inc. vs. State Of Florida, Department Of Education Status: Closed Recommended Order on Monday, August 26, 2019.

Summary: Petitioner failed to demonstrate that the intended award was clearly erroneous, arbitrary, capricious, or contrary to the competition. Recommend award to contract as previously recommended by the Department.

STATE OF FLORIDA

DIVISION OF ADMINISTRATIVE HEARINGS

ABACODE, LLC AND ZEROFOX, INC.,

Petitioners,

vs. Case No. 19 - 2741BID

STATE OF FLORIDA, DEPARTMENT OF

EDUCATION,

Respondent,

and

NTT DATA, INC.,

Intervenor.

_______________________________/

RECOMMENDED ORDER

Pursuant to notice, a formal administrative hearing was

conducted before Administrative Law Judge Mary Li Creasy in

Tallahassee, Florida, on June 25, 2019.

APPEARANCES

For Petitioner: J. Riley Davis, Esquire

Thomas A. Range, Esquire

Akerman LLP

106 East College Avenue , Suite 1200

Tallahassee, Florida 32301

For Respondent: Jason Douglas Borntreger, Esquire

Department of Education

325 West Gaines Street , Suite 1244

Tallahassee, Florida 32399

For Intervenor: Frederick John Springer, Esquire

Bryant Miller Olive P.A.

101 North Monroe Street , Suite 900

Tallahassee, Florida 32301

STATEMENT OF THE ISSUE S

Whether , when making a recommendation to award to NTT DATA ,

Inc ., the contract resulting from Invitation to Negotiate

2019 - 44 Re - Bid , Social Media Monitoring , Respondent , S tate of

Florida Department of Education ("the Department"), acted

contrary to one or more governing statutes , rules , policies , or

procurement specificatio ns, or any combination thereof ; and , if

so , whether the intended award was clearly erroneous , arbitrary,

capricious , or contrary to competition .

PRELIMINARY STATEMENT

On February 13 , 2019 , the Department issued I nvitation to

N egotiate 2019 - 44 Re - Bid ("the ITN"), seeking proposals for a

social media monitoring tool for the s tate's school systems.

Petitioners , Abacode , LLC and ZeroFOX , Inc. (jointly referred to

as "Abacode") , and Intervenor NTT Data , Inc. ("NTT") submitted

timely replies to the solicitation . At the conclusion of the

solicitation process , the Department ' s negotiation committee

issued an appro val request memorandum recom mending Abacode be

awarded the contract .

Shortly thereafter , Richard Corcoran , as Commissioner of

Education ( " Commissioner Corcoran " ) , issued a responsive

memorandum, rejecting the committee ' s recommendation and instead

directing the Department to award t he contract to NTT .

On April 22 , 2019 , the Department i ssued its Agency Award,

noticing its intent to award the contract to NTT . On April 24,

2019, Abacode submitted its Notice of Intent to Protest . On

May 6, 2019, Abacode submitted its Formal Written Protest ,

requesting that the Department withdraw the decision prescribed

in the Agency Award and award the contract to Abacode .

On May 8, 2019, NTT filed its Notice of Appearance as

Intervenor . The Department ref erred the matter to the Division

of Admini strative Hearings ("DOAH") on May 21 , 2019 , and the

parties commenced discovery and motion practice .

The final hearing took place as scheduled o n June 25 , 2019.

Three witnesses testified live: Jerry Rasmussen , on behalf of

Abacode; Regina Register , who m all three parties had identified

as a witness; and Rick Johnson , on behalf of NTT . In addition ,

the parties presented transcripts of deposition testimony by

four witnesses: Rick Johnson ; Jerry Rasmussen; Regin a Register ;

and Antoinette Williams . Upon stipulation of all parties , J oint

E xhibits 1 through 27 were admitted . Abacode's Exhibits 1

through 10, the Department's E xhibit 1 , and NTT's Exhibits 1

through 6 were also admitted .

The two - volume T ranscript of the proceeding was filed at

DOAH on July 25 , 2019 . The parties timely filed p roposed

recommended orders , which have been considered in preparation of

this Recommended Order . All references to the Florida Statutes

are to the 2019 version unless otherwise stated .

FINDING S OF FACT

Background

1 . Fol lowing the February 2018 gun violence tragedy at

Marjory Stoneman Douglas High School in Parkland , Florida , the

State of Florida enacted chapter 2018 - 3 , Laws of Florida , to

improve public safety . Section 21 of that law created a new

section 1001 . 212 , Flor ida Statutes , which inter alia required

the Department to provide , by December 1 , 2018 , " a centralized

integrated data repository and data analytics resources to

improve access to timely , complete , and accurate information

integrating data from " a variety of specified sources , including

social media . Section 50 of th at law appropriated $3 million to

the Department to competitively procure the required

" centralized integrated data repository and data analytics

resources " and to make them available by Decemb er 1 , 2018 .

2 . Toward that end , in August 2018 , the Department issued

an invitation to negotiate under section 287 . 057 , Florida

Statutes (the " 2018 ITN " ) . In December 2018 , the Department

issued a notice of intent to award the contract resulting from

the 2018 ITN to Abacode . A competitor , Social Sentinel ,

protested that intended award .

3. In January 2019 , the Department issued a revised

decision , indicating its intent to reject all responses to the

2018 ITN . Social Sentin el also protested that decisi on. The

Department referred the protest to DOAH , where Abacode

intervened . Following a final hearing , DOAH issued a

recommended order rejecting the protest and upholding the

Department ' s decision to reject all responses to the 2018 ITN .

See Social Senti nel , Inc . v . Dep ' t of Educ . , Case No . 19 - 0754BID

(Fla . DOAH Apr . 17 , 2019) .

4. While the protest of the 2018 ITN was pending at DOAH ,

on February 13 , 2019 , Governor Ron DeSantis issued Executive

Order 19 - 45 , deeming it unacceptable that the Department had

been delayed in its efforts to provide the resources required by

section 1001 . 212(6) , Florida Statutes . The Governor ordered the

Department to do so by August 1 , 2019 . The August 1 , 2019 ,

deadline was codified later via chapter 2019 - 22 , Laws of

Florida .

5. Consistent with Executive Order 19 - 45 , on February 13 ,

2019 , Commissioner Corcoran , determined that it was necessary to

proceed with a competitive procurement of the required resources

notwithstanding the pending protest . Commissioner Corcoran ' s

deci sion was authorized by section 120 . 57(3)(c) , Florida

Statutes , which provides:

(c) Upon receipt of the formal written

protest that has been timely filed , the

agency shall stop the solicitation or

contract award process until the subject of

the protest is resolved by final agency

action , unless the agency head sets forth in

writing particular facts and circumstances

which require the continuance of the

solicitation or contract award process

without delay in order to avoid an immediate

and serious danger to the public health ,

safety , or welfare .

6. The first part of section 120 . 57(3)(c) creates what is

commonly referred to as the " automatic stay ." The second part

of section 120 . 57(3)(c) authorizes an exception , that is , the

circumstances under which a n agency may override the automatic

stay and proceed with the contracting process .

7. Despite the pending protest, Commissioner Corcoran

issued a memorandum authorizing the re - advertisement of the

solicitation based on an immediate and serious danger to the

public health , safety , and welfare . As directed by Commissioner

Corcoran , on February 13 , 2019 , the Department issued a new

Invitation to N egotiate , the ITN at issue in this proceeding .

The ITN

8. The ITN solicit ed replies for a digital tool to help

school districts monitor threats of violence , signs of bullying ,

thoughts of suicide , and other issues affecting students '

well - being . T he ITN request ed a solution capable of monitoring

major social media sites in multiple languages and at speci fic

locations -- a practice commonly known as "geofencing" -- along with

notifications to contacts to be defined by participating school

districts . The ITN request ed in - person and web - based system

training , along with ongoing telephone and email support , and

request ed that vendors submit resumes for key personnel along

with details including prior relevant experience concerning the

scope of work . The ITN contemplates services effective for an

initial term of three years , with the option for three one - year

ren ewals thereafter .

9. In terms of vendor selection , the ITN state d that

replies would be evaluated and ranked on a scale of 1 to 100 --

70 points for the technical score and 30 points for price -- using

the criteria prescribed therein . The ITN is clear t hat

evaluation scores indicate only perceived benefits of th e reply,

and explicitly reserved the right to negotiate with all

responsive and responsible vendors in order to ascertain the

best solution . Moreover, the ITN reserved the right to seek

supplemen tation , clarification , or revision of vendor replies .

The ITN further provides that , after the conclusion of

negotiations , the Department w ould award the contract " to the

responsible and responsive vendor(s) that provide the best value

to the state , based on the criteria of the ITN ."

The Responses

10. T he Department received six replies to the ITN,

including those from both Abacode and NTT . Comparing the

proposals at issue here , both NTT and Abacode compete as service

providers , each offering a uni que technology solution . NTT' s

solution is based on the Brandwatch platform , while Abacode

offers the ZeroFOX platform .

11. Although Abacode and ZeroFOX are rep resented jointly

in this action, only the singular Abacode responded to the

Department ' s solicitation . In the event that Abacode received

the contract award , it had planned to enter into a subcontract

with ZeroFOX .

12. Abacode ' s security center operates out of Tampa ,

Florida , and is a local based company . Abacode employs

approximatel y 45 people and offers services as a managed

security services provider ("MSSP"). This role effectively

licenses Abacode to sell the ZeroFOX tool and provide services

related thereto , such as configuration management , maintenance ,

monitoring , support , and training . Although Abacode has

previously deployed the ZeroFOX tool , Abacode has not previously

implemented the ZeroFOX tool in an education context , and has

not previously implemented the ZeroFOX tool on behalf of a

government entity .

13. In contr ast, NTT is a global i nformation technology

company, the fifth largest in the world , and employs more than

250 , 000 people , with 55 subsidiary companies . One of thes e

subsidiaries, NTT Security, employs approximately 1 , 200 people

and competes with Abacode in the MSSP market . It is based in

the United Kingdom . In 2018 , an independent analy st firm ranked

NTT Security 10 th among MSSPs , while ranking Abacode at 71 st .

Unlike Abacode ' s experience with the ZeroFOX tool , NTT has

previously implemented the Brandw atch tool on behalf of public

education customers .

14. Regarding the tools themselves , Mr . Rasmussen

testified that ZeroFOX and Brandwatch do not " go to market " in

the same manner . In its reply , Abacode indicated that

Forrester , an analyst firm focu sed on the technology market , had

named ZeroFOX an industry leader in the market for "digital risk

protection." Abacode effectively views digital risk protection

as a " super set " of social media monitoring -- i . e ., the area

includes social media monitoring , but also includes a great deal

more .

15. Regarding NTT' s solution , the Brandwatch tool competes

not in the digital risk protection market , but in the " social

listening " market , where it is characterized by Forrester as a

" strong performer ."

16. In terms of implementation , Mr . Rasmussen testified

that Ab acode could "hit the switch," at which point the ZeroFOX

tool would begin immediately monitoring social media for threats

for all 67 school districts in Florida , if needed , upon being

given th e flat file of all the schools and their addresses .

Abacode can immediately monitor social media in all languages .

17. NTT' s use of Brandwatch also provides an immediately -

capable " out of the box " solution for social media monitoring .

However , whil e the Brandwatch tool is capable of immediately

taking any data load provided by Flor ida's school districts,

NTT' s proposed project schedule also reflects the time required

to implement the tool for district - level use . NTT ' s proposal

required six and one - half to seven months to fully implement its

monitoring program for all 67 districts . This includes

determining which school districts will participate ; identifying

points of contact within each school district ; determining which

parties will receive alert s from the tool ; and determining which

locations will be monitored via geo fencin g.

Evaluation , Negotiation , and Award

18. After receipt and opening of the replies , the

Department ' s procurement office conducted a preliminary review

to determine the ir responsiveness . Other than a single reply ,

which was later deemed nonresponsive , the Department ' s

procurement office determined that , pursuant to the provisions

of the ITN , any irregularities or deviations contained in the

remaining replies were minor and would be waived .

19. The members of the Evaluation Committee and the

Negotiation Committee are selected by the Department based upon

experience , expertise , and background so that the members have

the qualifications to understand what is needed b y the state

under the ITN and who are qualified to determine the vendor who

can offer the best method and provide the best value to the

state needed to meet the needs of the particular agency .

20. To begin the evaluation stage of the procurement , t he

Department selected an E valuati on C ommittee consisting of

five persons . C ommittee members were instructed to use the

criteria prescribed in the ITN document to assign individual

scores to each technical reply . After scoring , score sheets

were returned to the Department ' s procurement agent , Regina

Register , who added the technical evaluation scores with price

evaluation scores to obtain final evaluation scores.

21. In terms of results , the Department awarded Abacode

the highest total score , awardi ng 66 . 4 technical points and

18 . 2 cost points for a total evaluation score of 84 . 6 . The

Department awarded NTT the second highest total score ,

awarding 59 . 4 technical points and 24 . 9 cost points for a total

evaluation score of 84 . 3 . At the conclusion of the evaluation

process , the Department ' s procurement office provided evaluation

materials and summaries to the relevant management - level

approver , Andre Smith , to determine the parties with which the

Depar tment would enter negotiations.

22. The Depar tment selected a N egotiation C ommittee of

three persons and opted to negotiate with all five responsive

bidders , including both Abacode and NTT . The Department 's

N egotiation C ommittee conducted separate meetings with both

Abacode and NTT on March 25 , 2019 .

23. During the negotiation meeting with NTT , the

Department ' s Negotiation C ommittee inquired as to how NTT

intend ed to address staffing and user - level support for the

project per the requirements of the ITN . Although NTT had not

explicitly addres sed the issue in its in itial proposal, NTT

responded by clarifying its staffing intentions , naming specific

individuals intended to participate in the project along with

possible areas for expansion . Additionally , NTT detailed its

more specific intentions in the submission of its best and final

offer .

24. D uring t he negotiation meeting with NTT, NTT' s team

inquired as to whether the Department ' s Negotiation C ommittee

had any concerns regarding the proposed phase - in project

schedule . Antoinette Willi ams , who served as the Department 's

N egotiation C ommittee chairperson , responded that , while time

was of the essence , the implementati on schedule provided in

NTT' s reply would suit the Department ' s needs .

25. At the conclusion of negotiations , the D epartment ' s

procurement agent contacted both NTT and Abacode in or der to:

(1) correct or clarify any remaining questions and (2) solicit

each vendor ' s best and final offer . Abacode submitted a best

and final offer of $4 , 875 , 320 for the six - year term . NT T

submitted a best and final offer of $3 , 587 , 859 . 00 for the six -

year term , along with an optional discount of $100 , 000 in

exchange for a more relaxed project schedule .

26. NTT ' s price effectively hal ves that of its response in

the previous 2018 ITN .

27. Upon receipt of each vendor ' s best and final offers ,

the Department scheduled its In tent to Award meeting for

April 4 , 2019 . During the meeting , members of the Department 's

N egotiation Co mmittee were instructed to discuss the merits of

the vari ous proposals received and , at the conclusion of the

meeting , to cast written ballots for the vendor which members

felt provided the best value for the state .

28. In their discussion of the merits , the Negotiation

C ommittee did not rank or score com peting offers , and did not

undertake any formal written trade - off analysis between

technical offerings and proposed prices . However , at the

conclusion of the discussion , the N egotiation C ommittee members

cast their votes , resulting in a unanimous decision to reco mmend

award to Abacode. Ms . Williams drafted a memorandum to

Commissioner Corcoran recommending that the contract be awarded

to Abacode .

29. Regarding the N egotiation C ommittee ' s role in the

process , Ms . Williams , who has previously particip ated in

Department procurements , testified that she explicitly

recognized the role as reviewing proposals , meeting with

vendors , and ultimately , making a recommendation for

Commissioner Corcoran ' s consideration and review . Although

Ms . Williams cast her v ote for Abacode , she testified that she

did so specifically because Abacode ' s proposal offered more than

the criteria p rescribed in the ITN document -- a point which

Abacode has not only conceded , but advertised .

30. Indeed , Ms . Williams concluded tha t NTT would have

been her second choice , noting (1) that NTT was fully capable of

perfo rming the work and (2) that NTT' s price proposal was

substantially lower than that of Abacode . Moreover , although

privy to the technical and pricing materials submitted by each

vendor , it is important to note that the Department 's

N egotiation C ommittee was not briefed on the specific amount of

funds available for the project .

31. Although the committee members might have seen the

appropriation langua ge contained i n c hapter 2018 - 3, an annual

total of $3 million for the procurement or development of

multiple tools, neither the ITN nor the procurement office

instructed the Negotiation C ommittee as to the total amount to

be spent on this particular portion of the large r project .

32. D uring the pendency of the ITN process , the Department

completed its procurement of the rema ining tools prescribed by

law -- that is , the centraliz ed integrated data repository -- at an

annual cost of $2 . 6 million . Given the $3 million in itially

appropriated for the project , this cost was substantial , and

significantly reduced the funds available for the social media

monitoring portion of the project .

33. On April 15 , 2019 , Commissioner Corcoran decided t o

award the contract to NTT . The Commissioner memorialized his

decision:

I have reviewed the recommendation of the

Negotiation Committee that I appointed to

conduct negotiations in relation to the

invitation to negotiate for a social media

monitoring tool . I have also reviewed the

proposals offered in response to the

invitation to negotiate and consulted with

the Department ' s staff in relation to these

proposals . Notwithstanding the

recommendation of the Negotiation Committee ,

upon consideration of all the selection

criteria liste d in the invitation to

negotiate , I have concluded that NTT Data

provides the best value for the state .

NTT Data provides social media monitoring

services in the education sector and other

industries . NTT Data is capable of meeting

the compressed timeta ble for implementation

and , from a practical standpoint , offers

services that compare very favorably to

those of the vendor recommended by the

Committee . I must consider , however , that

social media monitoring is one component of

an effort to create a cent ralized data

repository to enhance the efforts to keep

Florida schools safe . NTT Data ' s best and

final price is $1 , 287 , 461 . 00 lower than the

vendor recommended by the Committee and that

savings can be more effectively applied in

other areas to enhance stu dent safety .

Based upon the foregoing , please proceed

with awarding the contract to provide a

social media monitoring tool as identified

in ITN 2019 - 44 to NTT Data .

34. Accordingly , on April 22 , 2019 , the Department issued

its notice of intent to award to NTT . Both Abacode and Social

Sentinel protested the April 22 , 2019 , intended award decision

resulting from the ITN . The protestors filed their formal

protest petitions on May 6 , 2019 . The next day , Commissioner

Corcoran again determined to cont inue with the contracting

process under section 120 . 57(3)(c) , notwithstanding the pendency

of the protests . Commissioner Corcoran memorialized his

decision in a memorandum of that same date (the " May 7 Memo " ) .

The May 7 Memo did not include language advi sing interested

parties of a right to challenge the decision or how to challenge

the decision .

35. O n June 11 , 2019 , the Department and NTT finalized and

executed the agreement for the tool . On June 13 , 2019 , Social

Sentinel voluntarily dismissed it s protest petition . When

Abacode failed to dismiss its petition , on June 19 , 2019 , NTT ,

as Intervenor, f iled a Motion for Summary Recommended Order or ,

in the Alternative , Motion to Relinquish Jurisdiction

("Motion"). NTT' s M otion argued that , because th e Department

completed the contracting process , DOAH lacks jurisdiction over

the matter , and the matter is moot . Abacode f iled written

opposition to the M otion , and on June 24 , 20 19, the undersigned

denied the M otion following a telephonic hearing . NTT's Motion

was renewed and rejected at final hearing.

Abacode's Arguments 1/

36. Abacode advances a variety of arguments in support of

its protest. Abacode argues it was improper to award the

contract to NTT because: Abacode's proposal offers the best

value to the state; Commissioner Corcoran should not have

rejected the u nanimous recommendation of the Negotiation

C ommittee; and NTT is not a responsive vendor. 2 /

37. NTT did not address Abacode's arguments in its

proposed recommended order but rat her renewed its earlier

arguments that the matter is moot because the contract was

already awarded and DOAH is unable to provide Abacode with any

relief.

Best Value

38. Abacode's argument center s around the contention that

its proposal would , despite the extra cost , provide a better

value to the s tate than that of NTT . Bot h the ITN and

chapter 287 , Florida Statutes, specify that the Department ,

through the ITN process , is tasked with the determining which

vendor provides the best value to the state b ased on the

selection criteria of the ITN . Accordingly , a failure to select

the vendor which provides the best value to the state based on

the prescribed criteria , if proven , would necessarily contravene

both solicitation specifications and governing stat utes , and

would warrant reversal in consideration of the appropriate

standards of review .

39. Abacode raises numerous features of its proposal which

it argues produce a better value for the state . Abacode argues:

NTT does not offer immediate state - wide implementation; NTT sets

its annual " mention " of a threat limit at 100 , 000 , 000 , while

Abacode ' s is without limit; NTT only provides alerts via email ,

while Ab acode also offers a smartphone "app" for users; and NTT

only supports analytics for a limited number of languages , while

Abacode can monitor any language by simply defining a keyword

list .

40. Assuming these claims are factually accurate , the

general argument is effectively summarized as follows: " [T]he

price proposed by Abacode , in terms of services proposed , is

more responsive , offers more for the dollar , and is more

proficient and effective than the proposal by NTT and clearly

offers the best method for accomplishing the intent of the ITN ,

and Chapter 1001 , Fla . Stat ."

41. Chapter 287 defines " best value " as " the highest

overall value to the state based on factors that include , but

are not limited to , price , quality , design and workmanship ."

§ 287 . 012(4) , Fla . Stat . Although this determination must

necessarily turn on a discretio nary conclusion -- a balancing test

consi dering the prescribed factors -- Florida courts are clear

that an agency has broad discretion in this regard , and the

agency ' s decision , when based on an honest exercise of this

discretion , will not be overturned by a c ourt , even if

reasonable persons might disagree . To that end , taken at face

value , Commissioner Corcoran ' s decision memorandum articulates

reasonable permissible motives for the Department ' s decision .

42. Although reasonable persons may disagree whe ther, when

it comes to the safety of the public school system, it is

desirable to focus on cost - savings rather than maximum

capabilities, the Department ' s decision to select a viable

solution based on lesser cost is well within the discretion

provided law.

Rejection of the Negotiation Committee ' s Recommendation

43. Abacode argues that Commissioner Corcoran ' s decision

to substitute his judgment for that of the unanimous

recommendation of Abacode by the Negotiation Committee was

contrary to the Departme nt ' s governing statutes , rules ,

policies , or solicitation specifications , and that the decision

was thereby clearly erroneous , contrary to competition ,

arbitrary , or capricious .

44. Abacode has not articulated which provisions of

statute , rule , o r po licy were contravened by Commissioner

Corcoran ' s decision . Ms . Register testified that , per the

Department ' s existing policies and procedures , Commissioner

Corcoran is free to substitute his judgment for that of the

N egotiation C ommittee in selecting the contract awardee .

Although uncommon , the practice is not precluded by law or rule ,

and state agencies , state courts , and federal courts have

regularly recognized agency heads ' authority to substitute their

will where cost is the deciding factor . See , e . g . Deloitte &

Touche , LLP v . State , Dep ' t . of HRS , 675 So . 2d 932 (Fla . 1st

D CA 1996) (affirming , per curiam , DOH ' s substitution of its

agency head ' s judgment in a request for proposals) .

45. As for solicitation specifications , the ITN dictates

only th at the Department , after negotiations are conducted , will

make an award to the responsible and responsive vendor that

provides the best value to the state . Although Abacode has

levied numerous claims regarding both the evaluation scores and

ultimate recom mendation provided by the Department ' s E valu ation

and N egotiation committees , at no point does the ITN promise or

imply a contract award based on these factors alone . Indeed ,

the ITN states that the Department will make an award , and the

Commissioner , in his role as the state ' s chief educational

officer and the lawful executive director of the Department ,

bears reasonable discretion and authority to make contract

decisions on the Department ' s behalf . § § 20 . 15(2) , 1001 . 10(1) ,

Fla . Stat .

NTT' s Status as a R esponsive Vendor

46. Section 287.012(27) defines a "responsive bidder" as a

vendor that submitted a reply that conforms in all material

respects to the solicitation . Abacode argues that NTT is not a

responsive vendor for four reasons: NTT's proposa l disregards

the deadline prescribed by law; NTT's proposal fails to include

the resumes of key management individuals; NTT relies on a tool

provided by a company in another country; and NTT's proposal

cites past performance unrelated to the ITN and refere nces that

cannot be verified.

47. Section 1001 . 212 requires the Department to provide a

centralized integrated data repository and data analytics

resources by August 1, 2019. Although NTT's proposal

incorporate s a phase - in schedule which extends pas t August 1 ,

2019 , testimony at hearing indicated that Brandwatch platform is

ready for immediate deployment and use . NTT ' s proposal simply

factors in additional project time and resources to integrate

district - level data and preferences into the tool . Th e law

requires that the social media monitorin g tool be available -- not

that all districts immediately use it. Thus , t his NTT's

proposal is responsive in this regard.

48. The ITN states that vendors should provide names and

resumes of key personnel o n the vendor ' s team . NTT 's proposal

identified the project lead but list ed "TBD" (to be determined)

under certain support positions . However, the omission was

waived by the procurement department as immaterial . NTT

provided clarification in both the neg otiation meeting and in

its best and final offer . NTT explained that it had several bid

proposals for work pending and it would assign key personnel

once it was advised of which, if any, contracts it was awarded.

Accordingly, NTT's proposal was sufficien tly responsive in this

regard.

49. ITN Addendum # 2 states that contract services shall

not be performed outside of the USA . Although Brandwatch's

headquarters is located in the United Kingdom, NTT's client

executive, Rick Johnson, testified that all training and

services will be supplied out of NTT's offices in Texas or

Florida, which meets the requirements of the ITN.

50. The ITN requests details regarding vendors ' relevant

experience concerning the scope of work described therein .

Abacode co ntends that its ZeroFOX platform is built for what the

ITN required , i . e . a security related tool for monitoring social

media .

51. According to Abacode, NTT's platform, Brandwatch , is a

social sentiment or marketing tool . Brandwatch listen s to

so cial media to see how people feel about a product or how

people feel about a brand.

52. Abacode ' s response to the ITN included reference to

similar use cases, i . e . social media monitoring for threats of

harm . Abacode provided references showing that ZeroF OX was a

leader not only in social media monitoring for threats of

violence , but provided references where the social medial

monitoring activity had been provided on behalf of education

institutions .

53. NTT 's proposal provided non educational r eferences

which dealt with social media monitoring for threats of

violence. NTT has relevant experience in monitoring in the

educati onal setting but due to the non disclosure provisions of

the contracts with those education institutions, they could not

be used as verifiable references.

54. Although ZeroFOX's platform offered by Abacode may be

superior to that of Brandwatch as offered by NTT, Brandwatch's

platform, as considered by the evaluation and negotiation

committees, adequately meets the needs of Respondent as

specified by the ITN and therefore, NTT's proposal was

responsive in this regard.

CONCLUSIONS OF LAW

55. DOAH has personal and subject matter jurisdiction in

this proceeding pursuant to sections 120 . 569 , 120 . 57(1) , and

120 . 57(3) , Fl orida Statutes .

56. Abacode has standing to bring this procurement protest

and NTT has standing to participate as an intervenor because

their substantial interests are at stake.

57. Pursuant to section 120 . 57(3)(f) , the burden of proof

rests wi th Abacode as the party opposing the proposed agency

action . State Contracting & Eng ' g Corp . v . Dep ' t of Transp . ,

709 So . 2d 607 , 609 (Fla . 1st DCA 1998) . Abacode must sustain

its burden of proof by a preponderance of the evidence . See

Dep ' t of Transp . v . J . W . C . Co ., Inc . , 396 So . 2d 778 , 787

(Fla . 1st DCA 1981) .

58. Section 120 . 57(3)(f) provides in part as follows:

Unless otherwise provided by statute , the

burden of proof shall rest with the party

protesting the proposed agency action . In a

comp etitive - procurement protest , other than

a rejection of all bids , proposals , or

replies , the administrative law judge shall

conduct a de novo proceeding to determine

whether the agency ' s proposed action is

contrary to the agency ' s governing statutes ,

the ag ency ' s rules or policies , or the

solicitation specifications . The standard

of proof for such proceedings shall be

whether the proposed agency action was

clearly erroneous , contrary to competition ,

arbitrary , or capricious .

59. The phrase " de novo proceeding ," as used in

section 120 . 57(3)(f) , describes a form of intra - agency review .

" The judge may receive evidence , as with any formal hearing

under section 120 . 57(1) , but the object of the proceeding is to

evaluate the action taken by the agency ." S tate Contracting ,

709 So . 2d at 609 .

60. A bid protest proceeding is not simply a record review

of the information that was before the agency . Rather , a new

evidentiary record based upon the facts established at DOAH is

developed . J . D . v . Fla . Dep ' t of Child . & Fams . , 114 So . 3d

1127 , 1132 - 33 (Fla . 1st DCA 2013) .

61. After determining the relevant facts based on the

evidence presented at hearing , the agency ' s intended action will

be upheld unless it is contrary to the governing statutes , the

agency ' s rules , or the bid specifications . The agency ' s

intended action must also remain undisturbed unless it is

clearly erroneous , contrary to competition , arbitrary , or

capricious .

62. The Florida Supreme Court explained the clearly

erroneous standard as follows:

A finding of fact is clearly erroneous when ,

although there is evidence to support such

finding , the reviewing court upon reviewing

the entire evidence is left with the

definite and firm conviction that a mistake

has been committed . This standard plainly

does not entitle a reviewing court to

reverse the finding of the trier of fact

simply because it is convinced that it would

have decided the case differently . Such a

mistake will be found to have occurred where

findings are not supp orted by substantial

evidence , are contrary to the clear weight

of the evidence , or are based on an

erroneous view of the law . Similarly , it

has been held that a finding is clearly

erroneous where it bears no rational

relationship to the supporting eviden tiary

data , where it is based on a mistake as to

the effect of the evidence , or where ,

although there is evidence which if credible

would be substantial , the force and effect

of the testimony considered as a whole

convinces the court that the finding is so

against the great preponderance of the

credible testimony that it does not reflect

or represent the truth and right of the

case .

Dorsey v . State , 868 So . 2d 1192 , 1209 n . 16 (Fla . 2003) .

63. The contrary to competition standard precludes actions

which , at a minimum: (a) create the appearance of and

opportunity for favoritism; (b) erode public confidence that

contracts are awarded equitably and economically; (c) cause the

procurement process to be genuinely unfair or unreasonably

exclusive; or (d) are unethical , dishonest , illegal , or

fraudulent . Care Access PSN , LLC v . Ag . for Health Care Admin . ,

Case No . 13 - 4113BID , 2014 Fla . Div . Admin . Hear . LEXIS 3 , at *54

(Fla . DOAH Jan . 2 , 2014); Phil ' s Expert Tree Serv ., Inc . v .

Broward C ty . Sch . Bd . , Case No . 06 - 4499BID , 2007 Fla . Div .

Admin . Hear . LEXIS 161 , at *23 (Fla . DOAH Mar . 19 , 2007) .

64. An action is " arbitrary if it is not supported by

logic or the necessary facts ," and " capricious if it is adopted

without thought or reason or is irrational ." Hadi v . Lib .

Behavioral Health Corp . , 927 So . 2d 34 , 38 - 39 (Fla . 1st DCA

2006) . If agency action is justifiable under any analysis that

a reasonable person would use to reach a decision of similar

importance , the decision is neither arbitrary nor capr icious .

J . D . , 114 So . 3d at 1130 . Thus , under the arbitrary or

capricious standard , " an agency is to be subjected only to the

most rudimentary command of rationality . The reviewing court is

not authorized to examine whether the agency ' s empirical

conclu sions have support in substantial evidence ." Adam Smith

Enters ., Inc . v . Dep ' t of Envtl . Reg . , 553 So . 2d 1260 , 1273

(Fla . 1st DCA 1989) . Nevertheless ,

the reviewing court must consider whether

the agency: (1) has considered all relevant

factors; (2) ha s given actual , good faith

consideration to those factors; and (3) has

used reason rather than whim to progress

from consideration of each of these factors

to its final decision .

Id .

65. Under section 287 . 057 , an agency seeking to procure

contractual services may elect to use either an invitation to

bid ( " ITB " ); a request for proposal ( " RFP " ); or , as here , an

ITN . § 287 . 057(1) , Fla . Stat . ; AT&T Corp . v . State , Dep ' t of

Mgmt . Servs . , 201 So . 3d 852 , 855 (Fla . 1st DCA 2016) . The ITN

process is the mos t flexible procurement process and

contemplates that not all vendors will necessarily provide the

same solution to the same problem . As recognized by the First

District in AT&T Corp. :

The ITN process was created as a distinctly

more flexible process than the RFP or ITB

process and gives an agency the means " to

determine the best method for achieving a

specific goal or solving a particular

problem " and to identify " one or more

responsive vendors with which the agency may

negotiate in order to achieve the be st

value ."

AT&T Corp . , 201 So . 3d at 855 (quoting § 287 .057(1)(c), Fla.

Stat. (2014)). 3/

66. Relevant to ITNs , section 287 . 057(1)(c) provides , in

pertinent part:

2 . The invitation to negotiate must

describe the questions being explored , the

facts being sought , and the specific goals

or problems that are the subject of the

solicitation .

3 . The criteria that will be used for

determining the acceptability of the reply

and guiding the selection of the vendors

with which the agency will negotiate mus t be

specified . The evaluation criteria must

include consideration of prior relevant

experience of the vendor .

4 . The agency shall evaluate replies

against all evaluation criteria set forth in

the invitation to negotiate in order to

establish a competit ive range of replies

reasonably susceptible of award . The agency

may select one or more vendors within the

competitive range with which to commence

negotiations . After negotiations are

conducted , the agency shall award the

contract to the responsible and responsive

vendor that the agency determines will

provide the best value to the state , based

on the selection criteria .

67. " Best Value " means " the highest overall value to the

state based on factors that include , but are not limited to ,

price , qua lity , design , and workmanship ." § 287 . 012(4) , Fla .

Stat .

68. Negotiations are an inherent component of the flexible

ITN process . However , the Department cannot make " material

changes " to the ITN during negotiations . AT&T Corp . , 201 So . 3d

at 858 . It has long been recognized that " [a]lthough a bid

containing a material variance is unacceptable , not every

deviation from the invitation to bid is material . It is only

material if it gives the bidder a substantial advantage over the

other bidders and t hereby restricts or stifles competition ."

Tropabest Foods , Inc . v . State Dep ' t of Gen . Servs . , 493 So . 2d

50 , 52 (Fla . 1st DCA 1986); AT&T Corp . , 201 So . 3d at 858

(concluding that revisions to statement of work that evolved

during negotiation phase did n ot restrict competition -- and

recognizing that AT&T elected not to modify its initial reply) .

69. Turning to the merits of the instant case , as detailed

above , the Department ' s proposed action , in awarding the

contract to NTT and not to Abacode, is no t contrary to the ITN

specifications , clearly erroneous , contrary to competition ,

arbitrary , or capricious . Any irregularities in NTT's proposal

as alleged by Abacode were minor and not material deviations .

RECOMMENDATION

Based on the foregoing Findings of Fact and Conclusions of

Law , it is RECOMMENDED that the Department of Education enter a

final order dismissing the protest of Abacode , LLC and ZeroFOX,

Inc.

DONE AND ENTERED this 26th day of August , 2019 , in

Tallahassee, Leon County, Florida.

S

MARY LI CREASY

Administrative Law Judge

Division of Administrative Hearings

The DeSoto Building

1230 Apalachee Parkway

Tallahassee, Florida 32399 - 3060

(850) 488 - 9675

Fax Filing (850) 921 - 6847

www.doah.state.fl.us

Filed with the Clerk of the

Division of Administrative Hearings

this 26th day of August , 2019 .

ENDNOTE S

1/ NTT argues that because the Department en tered into the

Social Media Mon itoring Tool contract on June 11 , 2019 , with

NTT , and that Abacode did not challenge t he decision to continue

the solicitation process pursuant to section 120 . 57(3) , Florida

Statutes, the issues are not moot and DOAH no longer has

jurisdiction .

T he May 7 , 2019 , memorandum was never published in the

Florida Administrative Register , nor was Abacode directly

notified by the Department that it intended to enter into a

contract with NTT regardless of the pendency of the bid protest .

Abacode accidentally found out about the internal memorandum

during the resolution meeting of the parties af ter the bid

protest was filed when same was casually mentioned at the

meeting . Counsel for Abacode specifically requested after

learning of the existence of such memorandum , that he be

furnished with a copy of same . A copy of this memorandum was

furnishe d to counsel via email dated May 15 , 2019 .

When transmitting the memorandum to counsel for Abacode ,

the Department did not advise counsel that it intended to , as

soon as possible , enter into the subject contract with NTT .

Arguably , the provisio ns of Section 120 . 57(3)(c) would allow the

Department to enter into such contract . However , the Department

failed to provide any point of entry to challenge this decision .

Abacode explained that it had hoped that the Department

would not enter into such contract pending the bid protest ,

which proceedings were on an expedited track . However , Abacode

elected not to seek action in circuit cour t or the appellate

courts to maintain that the declaration or a danger to public

health , safety , or welfare was not founded . Such a challenge

would consume resources , would result in likely failure , and

Abacode did not want to argue that the subject contract was not

in the interests of the public health , safety , and welfare of

the students of Florida .

S ect ion 120 . 57(3)(c) , and other provisions of

section 120 . 57 , do not explain what happens if an agency elects

to enter into a contract with a vendor pending a protest .

However , it is clear from a reasonable reading of section 120 . 57

that once a timely protest has been filed , that protest proceeds

to its rightful conclusion regardless of whether or not the

agency has entered into a contract with another vendor during

the pendency of the bid protest .

As explained on the record at final hearing, the cases

ci ted by NTT did not address a proceeding pursuant to

section 120.57(3)(c) , and were found not to be applicable and

were rejected by the undersigned. However, due to the

determination that NTT was properly awarded the contract in this

case, there is no need to further explain the rejection of NTT's

argument regarding jurisdiction in this Recommended Order.

2/ Initially, Abacode also argued that NTT was not a responsible

vendor. Florida law defines " responsible vendor " as " a vendor

who has the capability i n all respects to fully perform the

contract requirements and the integrity and reliability to that

will assure good faith performance ." § 287 . 012(25) , Fla . Stat .

As with the responsiveness designation , NTT ' s failure to meet

the " responsible " threshold wo uld contravene c hapter 287 and the

ITN specifications , and would merit reversal .

Because Abacode allege d that NTT is not a r esponsible

vendor, Abacode had the burden of proving that it does not

suffer from the same problem; that is , Abacode must prov e that

it is a responsible vendor . See Intercontinental Properties ,

Inc . v . Dep ' t of Health & Rehab . Servs . , 606 So . 2d 380 , 384

(Fla . 3d DCA 1992) ( " a party protesting an award . . . must be

prepared to show not only that the [awarded] bid was deficient ,

but must also show that the protestor ' s own bid does not suffer

from the same deficiency " ); se e also § 120 . 57(3)(f) , Fla . Stat .

( " burden of proof shall rest with the party protesting " ) .

NTT sought financial information in discovery from Abacode

to pr epare its defense to the responsibility issue. Abacode

failed to timely produce the requested information prior to the

deposition of its corporate representative.

After considering NTT ' s Second Motion in Limine and hearing

oral argument on this mo tion at final hearing , the undersigned

permitted Abacode to offer evidence and argument that NTT was

not " responsible " but precluding either side from presenting

information regarding " responsibility " (particularly financial

responsibility) that was not in cluded in response to the ITN or

that was not provided in discovery by Abacode prior to the

deposition of its corporate representative on June 20 , 2019 .

Because of this ruling , neither side presented evidence as to

their responsibility as a vendor and Aba code did not raise the

responsibility of NTT in its proposed recommended order.

3/ There are no substantive differences between the 2014 and

201 9 versions of section 287 . 057 .

COPIES FURNISHED:

Jason Douglas Borntreger, Esquire

Department of Education

Su ite 1244

325 West Gaines Street

Tallahassee, Florida 32399

(eServed)

J. Riley Davis, Esquire

Akerman LLP

Suite 1200

106 East College Avenue

Tallahassee, Florida 32301

(eServed)

Thomas A. Range, Esquire

Akerman LLP

Suite 1200

106 East College Avenue

Tal lahassee, Florida 32301

(eServed)

Frederick John Springer, Esquire

Bryant Miller Olive P.A.

Suite 900

101 North Monroe Street

Tallahassee, Florida 32301

(eServed)

Chris Emerson, Agency Clerk

D epartment of E ducation

Turlington Building, Suite 1520

325 West Gaines Street

Tallahassee, Florida 32399 - 0400

(eServed)

Matthew Mears, General Counsel

D epartment of E ducation

Turlington Building, Suite 1244

325 West Gaines Street

Tallahassee, Florida 32399 - 0400

(eServed)

NOTICE OF RIGHT TO SUBMIT EXCEPTIONS

Al l parties have the right to submit written exceptions within

1 0 days from the date of this Recommended Order. Any exceptions

to this Recommended Order should be filed with the agency that

will issue the Final Order in this case.