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Blind Vendor Contract Dipsute Given New Life

CINCINNATI (CN) - Kentucky's Office for the Blind may yet enjoin the contract process for attendant services at Fort Campbell's dining facility, the 6th Circuit ruled.

In previous years, the U.S. Army sought bids for contractors to provide dining-facility-attendant services at Fort Campbell under the Randolph-Sheppard Act.

Passed by Congress in 1936, the law gives blind people "priority in bidding contracts to operated vending facilities on federal properties."

Kentucky's Office for the Blind (OFB) balked in 2012 because the Army issued its solicitation that year as a set-aside for Small Business Administration Historically Underutilized Business Zones.

The OFB filed for arbitration and sought a temporary restraining order and preliminary injunction to prevent the military from awarding the new contract.

U.S. District Judge Thomas Russell in Paducah denied the requests, however, after finding that his court lacks jurisdiction because OFB had not exhausted its administrative remedies.

In reversing Monday, a three-judge panel with the 6th Circuit found that OFB need not exhaust its administrative remedies for the district court to consider the case.

"In an effort to avoid drive-by jurisdictional rulings, the court has instituted a clear-statement rule requiring Congress to 'state clearly that a threshold limitation on a statute's scope shall count as jurisdictional,'" Judge Karen Nelson Moore wrote for the court. "Under this rule, the act's exhaustion requirement is not jurisdictional. We do not believe the act contains statements sufficient to ... impose a limit on the jurisdiction of federal courts. Thus, we hold that the act's exhaustion requirement is not jurisdictional."

OFB should have been excused from the requirement even it had applied, the panel added.

"In this case, we conclude that exhaustion should have been excused because requiring the completion of arbitration prior to filing in federal court for a preliminary injunction would likely result in irreparable harm," Moore said.

As this appeal has been pending, a blind licensed vendor's contract expired with the Army, and the winner of the solicitation started providing dining-facility-attendant services the next day.

Meanwhile an arbitration panel sided with OFB in a February 2014 divided decision. "The arbitration panel concluded that the act covers the dining-facility-attendant services at Fort Campbell and that the Army violated the act by soliciting bids as a HUBZones set aside," Moore wrote. "Accordingly, the panel ordered the Army to terminate its contract with its current vendor on March 31, 2014, and to commence negotiations with OFB immediately for a new contract to take effect on April 1, 2014."

Moore noted that this change in circumstances and the unusual posture of this case requires the district court to now "consider whether any injunctive relief is available or appropriate at this time."

Judges Helene White and Bernice Donald concurred.

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