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Court rejects AT&T appeal over $360M state contract

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AT&T Corp. on Friday lost its appeal over a contract potentially worth $360 million that went to competitor Harris Corp. to provide phone and internet service to the State of Florida.

A unanimous panel of the 1st District Court of Appeal affirmed the decision of the Department of Management Services (DMS) to award the contract to a wholly owned subsidiary of Harris.

Friday’s opinion  by Chief Judge Clay Roberts and Judges T. Kent Wetherell II and Ross Bilbrey — declined to reverse the department’s decision and order a rebidding, as AT&T wanted.

The telecom giant previously had the management contract for the state’s “telecommunications infrastructure data network,” the ruling said. That deal expired in September. A new “invitation to negotiate,” or ITN, was issued in June 2014.

DMS ultimately is responsible for the SUNCOM network, “Florida’s state enterprise telecommunications system,” the opinion explained.

The court rejected all of AT&T’s arguments, including that the department “erred in relying on Harris’s qualifications instead of solely relying on the qualifications of the subsidiary to meet the experience and bonding requirements.”

“(B)oth vendors were responsive as to these issues,” it said.

The court also denied a claim that an administrative law judge wrongly decided that Harris responded properly to the bid’s “work requirements,” saying “there was no impropriety.”

And the judges said they “find the department’s actions in modifying the ITN’s specifications during the negotiation phase did not impede fair and open competition.”

“The fact that the department opted for a better value is not grounds for protest when the stated goals and questions of the ITN remained unchanged — achieving a highly reliable network that represented the best value to the state,” the opinion said.

AT&T spokesman Steven Schwadron said only that the company had “received a copy of the decision and are currently reviewing it.” There was no word on what further action they might pursue.

The department “is pleased to receive the (court’s) decision, which reflects and reaffirms the department’s commitment to a fair, open and competitive procurement process,” DMS spokeswoman Maggie Mickler said in a statement. “The department goes to great lengths to protect the integrity of the solicitation process for all procurements, and its experienced and knowledgeable staff work diligently to maintain the highest standard of integrity in public contracting.”

Added Carl D’Alessandro, president of Harris Critical Networks: “Today’s ruling reaffirms what Harris has always held to be true: DMS conducted a fair and honest procurement process for the SUNCOM network and found Harris to be the provider best suited to fulfill this project. As a Florida-based company we are excited to partner with the State on another project and we look forward to continuing our work with DMS.”

AT&T had paid a $3.6 million bond in order to challenge the contract. That equals about 1 percent of what AT&T was asking to get paid if it won the bid. The contract awarded by DMS is for seven years with an option for a seven-year renewal.

Background for this post provided by The Associated Press, reprinted with permission 

Before joining Florida Politics, journalist and attorney James Rosica was state government reporter for The Tampa Tribune. He attended journalism school in Washington, D.C., working at dailies and weekly papers in Philadelphia after graduation. Rosica joined the Tallahassee Democrat in 1997, later moving to the courts beat, where he reported on the 2000 presidential recount. In 2005, Rosica left journalism to attend law school in Philadelphia, afterwards working part time for a public-interest law firm. Returning to writing, he covered three legislative sessions in Tallahassee for The Associated Press, before joining the Tribune’s re-opened Tallahassee bureau in 2013. He can be reached at jim@floridapolitics.com.

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