SUPERIOR Court Presiding Judge Roberto C. Naraja found that Island Business Systems & Supplies Inc.’s protest lacked merit as he affirmed the Public School System’s decision denying IBSS's protest in the bidding for multifunctional networked printers for PSS operations.
IBSS, through attorney Vincent Seman, petitioned the court for a judicial review and named as respondents Lawrence F. Camacho, in his official capacity as commissioner of education; PSS; the Board of Education; and Xerox Corporation.
Camacho and the BOE were represented by attorney Tiberius D. Mocanu while Xerox was represented by attorney Charity R. Hodson.
Background
On July 26, 2023, PSS issued Invitation for Bid No. 23-030 for the procurement of a one-year lease on multifunctional networked printers for PSS operations, with an option to extend for two additional years.
The IFB required bidders to submit an “accountability guarantee,” which specified service call thresholds that would necessitate the replacement of any defective equipment.
IBSS submitted a bid in the amount of $2,056,340.48 while Xerox submitted a bid in the amount of $1,197,000.00. No additional bids were received.
On Sept. 22, 2023, PSS opened the submitted bids and commenced its evaluation process.
On Oct. 6, 2023, the PSS Evaluation Committee determined that Xerox’s bid met the IFB’s requirements and on Nov. 14, 2023, PSS issued a notice of intent to award the contract to Xerox, identifying it as the most responsible, responsive, and lowest-cost bidder.
IBSS filed a protest on Nov. 21, 2023, alleging that Xerox’s bid was non-responsive and that PSS failed to properly assess Xerox’s responsibility under Section 60-40-240(a) of the Northern Mariana Islands Administrative Code. IBSS also argued that neither the chief procurement officer nor then-acting COE Donna M. Flores had completed the necessary steps required by Section 60-40-240(b) of the Northern Mariana Islands Administrative Code before issuing the notice.
On Nov. 30, 2023, Xerox responded to the protest, stating that its bid was the lowest responsive bid and fully compliant with the IFB requirements and PSS procurement rules.
On Dec. 7, 2023, Eric M. Magofna, as acting COE, denied IBSS's protest, concluding that Xerox’s bid was responsible and responsive and that it offered the lowest price. He also determined that Xerox’s total satisfaction guarantee aligned with the IFB requirements and referenced Xerox’s reliable track record in prior PSS procurements.
On Dec. 15, 2023, IBSS appealed PSS’ denial to the BOE. On April 15, 2024, the BOE Appeals Committee affirmed PSS’ decision, finding no error in the procurement process.
On May 15, 2024, IBSS filed a petition for judicial review of the agency decision.
Court order
In a 16-page order issued on March 31, Judge Naraja found that Xerox met the responsibility criteria, having demonstrated substantial financial stability, adequate resources, and extensive experience — all of which support its ability to fulfill the contract requirements.
“Xerox’s longstanding history of service in the region, particularly with educational institutions and government agencies, further reinforces its status as a responsible bidder. While IBSS points to instances of negative feedback regarding Xerox’s past performance, the record indicates that these concerns were mitigated by external factors, including challenges arising during the Covid-19 pandemic,” Judge Naraja said.
“IBSS fails to present any controlling legal authority or substantive evidence demonstrating that Xerox’s bid was deficient. By contrast, Xerox’s documented financial stability, operational capacity, and past performance support its qualification as a responsible bidder,” the judge added.
He said the record demonstrates that the COE’s evaluation of Xerox’s financial stability, past service history, and regional capacity was integral to the procurement process — predating IBSS's protest and independent of this litigation.
“The Agency’s interpretation is neither novel nor selectively tailored to defend against IBSS's claims but rather is consistent with established procurement practices that assess bidder responsibility holistically,” Judge Naraja said.
Although IBSS's argument that monetary considerations should not be the sole determining factor has some merit, the court finds PSS’s position more compelling.
“As a government entity operating under budgetary constraints, the Agency appropriately considered cost as one of multiple factors in its evaluation. The scrutiny applied to Xerox’s bid reflects a rigorous review process, acknowledging that the qualifications enumerated in Section 60-40-240(a) serve as minimum qualifications rather than exclusive determinants of bidder responsibility,” the judge added.
IBSS's assertion that responsibility determinations must prioritize the highest level of performance or the absolute best product, regardless of cost, is inconsistent with both the text and purpose of the applicable regulations, the judge said.
