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IN THE COURT OF COMMON PLEAS OF FRANKLIN COUNTY, OHIO
CIVIL DIVISION
THORNTON-PLACE O CASE NO. 23CVH05-3434
CONTRACTORS JV, LLC, ]
PLAINTIFF, O JUDGE LYNCH
I
vs. O MAGISTRATE HUNT
I
THE OHIO ADJUTANT
GENERAL’S DEPARTMENT, et al., I
DEFENDANTS. 0
MAGISTRATE’S DECISION
This matter was initiated via a complaint filed by Plaintiff Thornton-Place
Contractors JV, LLC’s (“Thornton” or “Plaintiff’?) on May 15, 2023, against Defendants
The Ohio Adjutant General’s Department (“Adjutant General”) and the Ohio Army
National Guard (“National Guard”) (collectively the “State” or “Defendants”). The
subject of the complaint is the award of a contract (“Contract”) for a construction project
known as the Rickenbacker Army Enclave Readiness Center (“Project”). Count One of
the complaint is for Declaratory Judgment alleging that Plaintiff is entitled to a
declaratory judgment that the State acted arbitrarily, unreasonably and unconscionably
in rejecting Plaintiff's bid based on unannounced criteria. Count Two is for Injunctive
Relief alleging that Plaintiff is entitled to temporary, preliminary and permanent
injunctive relief in equity against the State enjoining and restraining them from further
pursuing the Contract for the construction of the Project.
The Court denied Plaintiff's request for a Temporary Restraining Order on May
16, 2023. On May 17, 2023, Miles-McClellan Construction Co. (“Miles” or “Intervenor’),
the successful bidder on the Project, filed a Motion to Intervene As a Defendant which
was granted on June 1, 2023. On June 12, 2023, the Court granted the State’s
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unopposed motion to combine the preliminary injunction hearing with the trial on the
merits.
Pursuant to Civil Rule 53 and Loc. R. 99.02, the matter was referred to this
Magistrate. The Hearing/Trial was held on June 21 and 23, 2023, in Courtroom 7D and
was recorded by electronic means. Plaintiff was represented by attorney W. Blair
Lewis. Plaintiff presented the testimony of Willis Herweyer, Michael Russell, Tambra
Alexander-Wade, George McCann, and Jeff Amason. The State was represented by
attorneys Jerry Kasai and Howard Harcha and presented the testimony of Tambra
Alexander-Wade, Kevin Brinckerhoff, Troy Place (via deposition), Anne Frost, and
Colonel Rodney Tansill. Intervenor presented the testimony of Matthew Recchiuti. The
parties stipulated that the following exhibits were admitted into evidence: A, A1, A2, and
B through W. Intervenor offered Exhibits X, Y, Z, AA, BB and DD which were admitted
into evidence.
The parties were ordered to submit and file Proposed Findings of Fact and
Conclusions of Law by July 7, 2023. This Magistrate has reviewed the parties’
respective filings. Having weighed the evidence submitted during the hearing, having
read and reviewed the exhibits and having applied the required law, this Magistrate
hereby renders the following decision:
FINDINGS OF FACT AND CONCLUSIONS OF LAW
This Magistrate’s Findings of Fact are based on the testimony of the witnesses
and the exhibits introduced into evidence. This Magistrate reviewed all the exhibits and
considered each as to its weight and credibility. The credibility of the witnesses was
considered. The credibility of a witness is based upon the appearance of the witness
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upon the stand; his/her manner of testifying; the reasonableness of the testimony; the
opportunity he/she had to see, hear and know the things concerning which he/she
testified; his/her accuracy of memory; frankness (or lack of it); intelligence, interest and
bias (if any); together with common sense and all the facts and circumstances
surrounding the testimony. Of importance in deciding the Findings of Facts, this
Magistrate notes that she is free to believe all, some, or none of the testimony of each
witness appearing before her. State v. Ellis, 8" Dist., Cuyahoga No. 98538, 2013-Ohio-
1184.
A preliminary injunction is an extraordinary remedy; therefore, the moving party
has a substantial burden to meet in order to be entitled to the injunction. Sinoff v. Ohio
Permanente Med. Group, 146 Ohio App. 3d 732, 2001 Ohio 4186, 767 N.E.2d 1251,
citing Ormond v. Solon (Oct. 18, 2001), Cuyahoga App. No. 79223, 2001 Ohio App.
LEXIS 4654. The moving party must establish a right to the preliminary injunction by
showing clear and convincing evidence of each element of the claim. Sinoff v. Ohio
Permanente Med. Group, 146 Ohio App. 3d 732 (8"" Dist. 2001), citing Vanguard Transp.
Sys., Inc. v. Edwards Transfer & Storage Co., Gen. Commodities Div., 109 Ohio App.3d
786 (10"" Dist. 1996). “Clear and convincing evidence is that measure or degree of proof
which will produce in the mind of the trier of facts a firm belief or conviction as to the
allegations sought to be established. It is intermediate, being more than a mere
preponderance, but not to the extent of such certainty as is required beyond a reasonable
doubt as in criminal cases.” Connor Grp. v. Raney, 2nd Dist. Montgomery, 2016-Ohio-
2959, J] 20, 2016 Ohio App. LEXIS 1836, *17 (May 13, 2016) (internal citations omitted).
In determining whether to grant a preliminary injunction, a court must consider:
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(1) whether there is a substantial likelihood that the plaintiff will prevail on the
merits of its claims;
(2) whether the plaintiff will suffer irreparable harm if the injunction is denied;
(3) whether third parties will be unjustifiably harmed if the injunction is granted;
and
(4) whether the public interest will be served if the injunction is granted.
Hydrofarm, Inc. v. Orendorff, 2008-Ohio-6819, {118 (10thDist.), quoting Vanguard Transp.
Systems, Inc. v. Edwards Transfer & Storage Co., 109 Ohio App.3d 786, 790
(10thDist.1996); Valco Cincinnati, Inc. v. N&D Machining Serv., Inc., 24 Ohio St.3d 41
(1986); Corbett v. Ohio Building Authority, 86 Ohio App.3d 44, 49 (10thDist.1993). See
also Thomas J. Dyer Co. v. Franklin County Convention Facilities Authority, 61 Ohio
Misc.2d 132, 133-34 (Franklin Cty.C.P.1990). The primary goal of preliminary injunctive
relief “is to preserve the status quo pending final determination of the matter.” Ohio
Urology, Inc. v. Poll, 72 Ohio App.3d 446, 454 (10" Dist.1991).
Moreover, the party seeking injunctive relief must establish a right to the
preliminary injunction by showing clear and convincing evidence of each element of the
claim. Vanguard, supra at 790; Cleveland v. Cleveland Elec. Illum. Co., 115 Ohio App.3d
1, 14 (10thDist.1996). In determining whether to grant injunctive relief, no one factor is
dispositive; the four factors must be balanced with the “flexibility which traditionally has
characterized the law of equity.” /d. “When there is a strong likelihood of success on the
merits, preliminary injunctive relief may be justified even though a plaintiff's case of
irreparable injury may be weak. In other words, what [a] plaintiff must show as to the
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degree of irreparable harm varies inversely with what [a] plaintiff demonstrates as to its
likelinood of success on the merits.” /d.
The purpose of a preliminary injunction is to preserve a status between the
parties pending a trial on the merits. Consun Food Indus., Inc. vv. Fowkes, 81 Ohio
App.3d 63 (9"" Dist. 1991). In this matter, the Court consolidated the hearing on the
preliminary injunction with a hearing on the merits for the permanent injunction pursuant
to Civil Rule 65(B). “An injunction is an extraordinary remedy in equity where there is
no adequate remedy available at law. It is not available as a right by may be granted by
a court if it is necessary to prevent a future wrong that the law cannot.” Garono v. State,
37 Ohio ST.3d 171, 173 (1988). “A permanent injunction is not considered an interim
remedy. It is issued after a hearing on the merits in which a party has demonstrated a
right to relief under the applicable substantive law.” Procter & Gamble Co. v.
Stoneham, 140 Ohio App.3d 260, 267-268 (1% Dist. 2000). A party must prove that
entitlement to the requested relief by clear and convincing evidence. /d. at 268. “Clear
and convincing evidence is that measure or degree of proof which will produce in the
mind of the trier of facts a firm belief or conviction as to the allegations sought to be
established.” Cross v. Ledford, 161 Ohio St. 469, 477 (1954). The party seeking a
permanent injunction must also demonstrate that the injunction is necessary to prevent
irreparable harm and that no adequate remedy at law is available. Stoneham at 267.
Speculative harm will not suffice. Camp v. Washington Community Bd., Inc. v. Rece,
104 Ohio App.3d 750, 754 (1 Dist. 1995).
Plaintiff failed to meet its burden that it is entitled to declaratory judgment and a
permanent injunction in this case wherein it alleged that the State acted arbitrarily,
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unreasonably and unconscionable in rejecting Plaintiff's bid based on unannounced
criteria and awarded the contract to Miles. The lack of an announced standard and
priority of miscellaneous considerations in public bidding allows unbridled discretion and
political favoritism. City of Dayton, es. Rel. Scandrick v. McGee, 67 Ohio St.2d 356
(1981). Ohio Supreme Court precedence provides that the utilization of unannounced
criteria in selecting a bidder constitutes an abuse of discretion that warrants the
issuance of a permanent injunction against the entering into a contract with the higher
bidder. Id. “The meaning of the term ‘abuse of discretion’ * * * connotes more than an
error of law or of judgment; it implies an unreasonable, arbitrary or unconscionable
attitude ***.” Steiner v. Custer, 137 Ohio St. 448, paragraph two of the syllabus
(1940); Connor v. Connor, 170 Ohio St. 85 (1959); Rhode v. Farmer, 23 Ohio St.2d82
(1970); and State v. Adams, 62 Ohio St.2d 151 (1980). Arbitrary means “without
adequate determining principle; * * * not governed by any fixed rules or standard.”
Black’s Law Dictionary (5 Ed.). Unreasonable means “irrational.” /d.
Plaintiff is a Georgia limited liability company that is a joint venture between
Place Services, Inc. (“Place”) and V-Line Services, Inc. (“V-Line’). Its Certificate of
Organization was filed with the state of Georgia on October 15, 2020. Plaintiff
registered to do business in Ohio with the Ohio Secretary of State on May 15, 2023.
[Ex. Q]. Mr. Herweyer is the president and majority owner of V-Line. Plaintiff is majority
controlled by V-Line. Place is a minority partner of Plaintiff. The current joint venture
agreement for Plaintiff was executed on March 31, 2023, and was signed by Mr.
Herweyer on behalf of V-Line and Tony Place on behalf of Place as its president.
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V-Line is an architectural, engineering and construction firm with approximately
45 employees. At the time of the hearing, V-Line was currently performing work in Ohio
which included federal contracts at Rickenbacker, a project at the Veteran
Administration’s medical center in Cincinnati, and three projects at the Veteran
Administration's medical center in Dayton.
Place is also an architectural, engineering and construction firm based in Canton,
Georgia. It has approximately 500 employees and eight offices, one of which is a
federal division in Lewis Center, Ohio. Place does primarily commercial retail
construction and also does work with local and state governments. At the time of the
hearing, it had done work in Ohio for Westerville City School District, Delaware School
System, and the Tri-Township Fire Station in Delaware.
The Adjutant General is an agency of the State of Ohio created by the General
Assembly pursuant to R.C. 5913.01. The National Guard was created by Chapter 5919
of the Revised Code and is under the command of the Adjutant General. R.C.
5913.01(A)(12). The Project is a proposed 42,000 square foot facility to be built for the
Adjutant General at Rickenbacker Air National Guard base (“Rickenbacker”), to be
utilized by the Ohio National Guard. When completed, the Project will have space for
office administration, storage, educational classrooms, military training, an assembly
center, the requisite parking, additional utilities and outdoor space. The hard cost for
the Project was estimated in excess of $13 million.
The current facilities utilized by Defendants were constructed in the 1950’s and
were built for Lockbourne Air Force Base and not for Defendants’ current mission. The
current facilities are in disarray and need to be torn down or replaced. The current
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facility is short 70,000 square feet and the Readiness Center will be able to serve a
brigade or battalion. The new facility will house the armory or Readiness Center for the
Ohio National Guard.
The Contract for the construction of the Project was originally bid on March 6,
2023. Plaintiff and Miles both submitted a timely bid. On March 9. 2023, the Adjutant
General published a Notice of All Bids Rejected for the Project which provided the
following in relevant part:
Please take notice that all bids for the project noted above are hereby
rejected. The project will be re-bid at a future date on Bid Express.
* * *
As provided in Section 153.09 of the Ohio Revised Code, this work will be
re-advertised ONE TIME ONLY.
We appreciate your interest in bidding State work and we hope that you
will bid on future State projects. If you have any questions or concerns
regarding this matter, contact the Project Coordinator, Tambra Alexander-
Wade * **
R.C. 153.09 states that, “(i)f in the opinion of the owner * * *, the award of a contract to
the lowest responsive and responsible bidder is not in the best interests of the state, the
”
owner may accept another bid so opened or reject all bids, and advertise for other bids.
R.C. 153.09. No evidence was presented that Plaintiff nor any other bidder objected to
the March 9"" rejection of all of the bids. The Magistrate also notes that nowhere in
Plaintiff's complaint does it claim that the March 9" rejection was contrary to law.
Additionally, the March 9" bid was not even presented to the Magistrate and wasn't
offered or admitted into evidence.
The Project was re-bid, and the subsequent bids were due by 2:00 p.m. on April
6, 2023. Plaintiff was the low apparent bidder and Miles was the second low apparent
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bidder. Plaintiff's bid was $13,247,400.00 and Miles’ bid was $13,317,440.00. [Ex. V]
It is uncontested that joint ventures were permitted to bid on the Project. Anne Frost,
the Chief Planning and Procurement Officer for the Adjutant General’, was involved in
the initial bid and re-bid. She testified that she has experience with joint ventures and
that joint ventures were allowed to submit bids on the Project. Furthermore, Section
6.1.11 in the Conditions Precedent for Execution of Contract specifically provides that
“(i)f the Bidder is a joint venture, it must submit the executed agreement between the
joint venturers describing the division of services/work and percentage of contract for
each company, and a Power of Attorney which authorizes one or more individuals to
bind the joint venture and each individual joint venturer to Contract Modifications.” [Ex
Al.
It is also uncontested that although federal funds, as well as state funds, were
being utilized to fund the Project, that the Project is conducted by and was bid as a
State of Ohio project, meaning the State of Ohio contracting processes apply to the
Project. Per the Project Manual, bids were being received in compliance with section
153.03 of the Ohio Revised Code. The Bid Documents, which include the Instructions
to Bidders, set forth the criteria and process for the Adjutant General to evaluate the
bids it received. [Ex. A]. The Instruction to Bidders provides in relevant part:
3.5 Bid Evaluation Procedure
3.5.1 The Contract shall be awarded to the lowest responsive and
responsible Bidder as determined in the discretion of the Contracting
Authority, or all Bids may be rejected in accordance with Applicable Law
* * *
' Ms. Frost was promoted to this position on May 8, 2023, from her prior position as Master Planner for
the Adjutant General.
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3.5.3 In determining whether a Bidder is responsible, factors to be
considered Include, without limitation:
3.5.3.1 preferences required by law, where applicable;
3.5.3.2 the experience of the Bidder;
3.5.3.3 the financial condition of the Bidder;
3.5.3.4 the conduct and performance of the Bidder on previous
Contract, including compliance with Equal Employment Opportunity in
the Construction Industry Administrative Rules, OSHA and Prevailing
Wage laws, and demonstration of good faith effort to participate in the
EDGE Business Development program, or actual participation in the
EDGE Business Development program, or both as indicated in the
ORC and the Ohio Administrative Code;
3.5.3.5 the facilities of the Bidder;
3.5.3.6 the management skills of the Bidder, including the capability of
the Bidder to construct and manage the entire Project, including but no
limited to the plumbing, fire protection, heating, ventilating and air
conditioning, and electrical branches or classes of the Work; and
3.5.3.7 the Bidder’s ability to execute the Contract properly, including
past performance of the Bidder and the Subcontractors that the Bidder
proposes to use on the Project.
* * *
6.1 Conditions Precedent for Execution of Contract
6.1.1 The successful Bidder must submit the items in this Section 6.1 to
the Contracting Authority before executing the Agreement.
6.1.2 Bond, and to support the Bond, a Certificate of issued by the Ohio
Department of Insurance, showing the Surety is licensed to do business
in the State of Ohio.
6.1.3 Ohio Workers’ Compensation Certificate.
6.1.4 Certificate of Compliance with Affirmative Action Programs,
issued by the Equal Opportunity Coordinator. * * *
6.1.5 Certificate of Insurance (ACORD) form is acceptable) and copy of
additional Insured or loss payee endorsement. * * *
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6.1.6 If a Bidder is a foreign corporation (e.g. not incorporated under the
laws of Ohio) it must submit a Certificate of Good Standing from the
Ohio Secretary of State showing the right of the Bidder to do business
in the state of Ohio
* * *
6.1.8 Evidence that the Bidder is enrolled in, and in good standing in, a
DFSP approved by the OBWC.
* * *
6.1.11 If the Bidder is a joint venture, it must submit the executed
agreement between the joint venturers describing the division of
services/work and percentage of contract for each company, anda
Power of Attorney which authorizes one or more individuals to bind the
joint venture and each individual joint venturer to Contract
Modifications.
[Ex. Al.
The Instructions to Bidders state that the above-listed Conditions Precedent needed to
be submitted within 10 days of the date of the Notice of Intent to Award and that the
execution of the Contract required compliance with the Conditions Precedent. [Id.].
The Magistrate notes that the State presented testimony by Ms. Alexander-Wade
and Ms. Frost that Plaintiff did not submit documentation listed under the above
Conditions Precedent for Execution of Contract such as an Ohio Workers’
Compensation Certificate, a Certificate of Compliance with Affirmative Action Programs,
and the agreement between the joint venturers describing the division of services/work
and percentage of contract for each company. Plaintiff admitted that it doesn’t possess
a valid Certificate of Compliance with Affirmative Action Programs issued by the Ohio
Department of Development pursuant to R.C. 9.47. [Ex. R, p. 3]. Mr. Herweyer testified
that Plaintiff did not possess a current Worker's Compensation Certificate. However,
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Plaintiff never received a Notice of Intent to Award. Accordingly, Plaintiff was not
required to submit the Conditions Precedent items.
More importantly, whether or not Plaintiff was able to comply with the Conditions
Precedent, such compliance was not the basis for the State’s rejection of Plaintiff's bid.
The basis was set forth in a letter dated April 14, 2023 (“Rejection Letter”) which states:
Dear Mr. Herweyer:
The Adjutant General has completed its bid evaluation for the above project,
including the Adjutant General's review and evaluation of information
submitted by Thornton-Place Contractors JV, LLC., as well as AECOM’s
review and recommendation.
Pursuant to Section 3.6.1 of the Instruction to Bidders, this letter serves as
the Adjutant General’s notice that Thornton-Place Contractors JV. LLC., bid
for the above project is deemed as non-responsible for this project and is
therefore rejected.
The non-responsibility determination is based on the Adjutant Generals
finding that Thornton-Place Contractors JV, LLC., does not have the
necessary experience for this project, including, but not limited to, Thornton-
Place Contractors JV, LLC., failure to have the experience and financial
history required by the bid documents. See Instructions to Bidders sections
as follows:
3.5.3.2 the experience of the Bidder.
3.5.3.3 the financial condition of the Bidder.
3.5.3.4 the conduct and performance of the Bidder on previous Contracts,
including compliance with Equal Employment Opportunity in the Construction
Industry Administrative Rules, OSHA and Prevailing Wage laws, and
demonstration of good faith effort to participate in the EDGE Business
Development program, or actual participation in the EDGE Business
Development program, or both, as indicated in the ORC and the Ohio
Administrative Code.
3.5.3.5 the facilities of the Bidder.
3.5.3.6 the management skills of the Bidder, including the capability of the
Bidder to construct and manage the entire Project, including but not limited to
the plumbing, fire protection, heating, ventilating and air conditioning, and
electrical branches or classes of the Work; and
3.5.3.7 the Bidder’s ability to execute the Contract properly, including past
performance of the Bidder and the Subcontractors that the Bidder proposed
to use on the Project.
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To the extent that Thornton-Place Contractors JV, LLC., disagrees with the
Adjutant General's rejection, an objection may be filed pursuant to the
procedures set forth in Paragraph 3.6.3 of the Instructions to Bidders. If
Thornton-Place Contractors JV, LLC., chooses to object to the determination,
then the Adjutant General will promptly schedule a bid protest meeting.
Sincerely,
Tambra Alexander-Wade
Project Coordinator
[Ex. E].
Plaintiff argues that it was a responsible bidder because the joint venturers Place
and V-Line, together have the requisite experience, conduct and performance, and
financial history/condition for the Project. They argue that the State used unannounced
Criteria to reject Plaintiff's bid because “(n)owhere to the Instructions to Bidders state
that an LLC is not permitted. * * * The Instructions to Bidders are totally silent on the
issue of whether a bidder needs to be an LLC, S-Corp, etc... .” [Plaintiff's Proposed
Findings of Fact and Conclusions of Law, p. 10].
However, the State did not reject Plaintiff's bid because it is an LLC. Nor does it
assert that an LLC was not permitted to bid on the Project. Rather, the State argues
that Plaintiff, as an LLC, is a separate legal entity than the individual joint venturers. As
a result, it claims that it appropriately limited its evaluation of Plaintiff under the factors
listed in 3.5.3 of the Instructions to Bidders to Plaintiff as an LLC and not the combined
factors of Place and V-Line. This Magistrate agrees with the State’s determination that
Plaintiff was a non-responsible bidder.
The definitions section of the Bid Documents defines “Bidder” as “(a) person that
submits a Bid.” [Ex. A-1]. A joint venture is “an association of persons with intent, by
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way of contract, express or implied, to engage in and carry out a single business
adventure for joint profit, for which purpose they combine their efforts, property, money,
skill and knowledge, without creating a partnership, and agree that there shall be a
communhity of interest among them as to the purpose of the undertaking, and that each
coadventurer shall stand in the relation of principal, as well as agent, as to each of the
other coadventurers * **.” A/ Johnson Construction Co. v. Kosydar, 42 Ohio St.2d, 29
(1975). The rule in Ohio is that partnership law governs joint ventures. Cominsky v.
Malner, 11" Dist. No 98-L-242, citing Vargo v. Clark, 128 Ohio App.3d 589, 595 (1998).
Essentially a joint venture is a partnership entered into for a single transaction or limited
period of time. Bus/erv. D & H Mfg., 10" Dist. No. 91AP-1175 (1992). Hence, courts
generally apply principles of partnership law to govern the relationship. /d., citing A/
Johnson, supra, at 32.
However, Plaintiff chose to establish itself as an LLC and in doing so created a
completely different legal entity than a joint venture. As an LLC, Plaintiff is a separate
legal entity under Ohio Law. R.C. 1706.04. Under Georgia law, “Limited liability
company’ means a limited liability company formed under this chapter.” OCGA 14-11-
101. Also, Georgia law provides that each limited liability company formed in this state
shall have the same powers as any person has to do all things necessary to carry out its
purpose, business, and affairs. OCGA 14-11-202. Mr. Amason, general counsel for
Place and V-Line, testified that an LLC stands as a person in the eyes of the law. The
Magistrate finds that Plaintiff is a separate legal entity from Place and V-Line. Plaintiff is
the “Bidder” as defined by the Instructions to Bidders and the bid documents specifically
state that the determination of responsibility of the Bidder is based upon the experience
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and financial condition of the “Bidder.” Likewise, R.C. 9.312(B) provides that the
responsibility of a “Bidder” is to be determined upon the experience and financial
condition of the “Bidder.” [Ex. S].
Mr. Herweyer agreed that neither Place nor V-Line submitted the bid. Plaintiff
submitted the bid. With its bid, Plaintiff submitted a document titled Bidder’s
Qualifications which was signed on February 23, 2023. [Ex. K]. That document
required the Plaintiff to provide its overall experience performing the trades bid, its
relevant facilities and major equipment, and ongoing projects and projects completed in
the last 5 years which are similar in cost and type to the Project. Plaintiff's responses
only provided information for Place or V-Line and none of the answers applied to
Plaintiff's LLC. [Id.]. Consistent with this fact is Mr. Herweyer’s testimony that Plaintiff's
LLC has not received any contracts or performed any jobs in Ohio, has not performed
any jobs whatsoever, does not have any field employees, does not own any equipment,
has a bank account (but there is no activity on the account), and has no existing
financials.
In its Proposed Findings of Fact and Conclusions of Law, Plaintiff spends a great
deal of time arguing that Ms. Alexander-Wade made the decision to reject Plaintiff's bid.
However, the Magistrate finds that this argument is not supported by any credible
evidence. In fact, the evidence was clear that Ms. Alexander-Wade did not have the
authority to reject any bid. The Magistrate notes that she found the testimony of Ms.
Alexander-Wade to be credible. She testified that she doesn’t make the decision
regarding bids, and she has to run everything through her manager. She stated that
everything she does is clerical and her main function when reviewing bids is to go down
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a list and check boxes. Ms. Alexander-Wade’s testimony showed that she incorrectly
believed that Plaintiff had to be registered with the Ohio Secretary of State and that she
considered Plaintiff's lack of registration as a factor in the rejection of Plaintiff's bid.
However, she stated numerous times in her testimony that the main reason the State
rejected Plaintiff's bid was because of the lack of experience and qualifications of
Plaintiff's LLC.
It is uncontested that Plaintiff's March 3" and April 6" bids were substantively the
same regarding its Bidder Qualification submissions. [Ex. K]. Michael Russell is the
architect/project manager for AECOM and the architect/engineer for the Project. He
testified that he only reviewed Plaintiffs bid but was not involved in the evaluation of the
bid. When he reviewed Plaintiffs bid, he noted that Plaintiff's bid provided experience
for Place and V-Line and not for Plaintiff's LLC. He stated that had he been involved in
the evaluation, unless Plaintiff's LLC had the requisite experience, not the independent
joint venturers, he would not have considered the bid.
Ann Frost became employed as the Chief Planning and Procurement Officer to
the Adjutant General’s Office on May 8, 2023. As such, she is Ms. Alexander-Wade’s
current Manager. At the time of the bids at issue, Ms. Frost was the Master Planner for
the Adjutant General’s Office, but Ms. Alexander-Wade consulted Ms. Frost about
Plaintiff's bids as Ms. Alexander-Wade knew Ms. Frost was assuming the new role of
her manager. Both Ms. Alexander Wade and Ms. Frost testified that both Plaintiff's
initial bid and re-bid on April 6" were very confusing. Again, as stated above, Ms. Frost
testified that she has experience with joint ventures and that joint ventures were eligible
to bid on and be awarded the contract. Ms. Frost testified that in the over five years she
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has reviewed bids she has never seen one as confusing as Plaintiff's. She testified that
the concern with Plaintiff's April 6" bid was that it the bid appeared to be from a joint
venture, but in actuality it was from an LLC, and that the bid appeared to be from
multiple bidders. [Ex. C]. She testified that it was not clear that Plaintiff's LLC had the
necessary experience and qualifications for the Project. She stated that due to the
confusion, she and Ms. Alexander-Wade elevated the matter to their legal counsel, the
Ohio Attorney General’s Office. After consulting with the attorneys, Ms. Frost said there
was an internal meeting prior to rejecting Plaintiff's bid. Finally she testified that the
ultimate decisions in the rejections of Plaintiff's bids lied with Colonel Rodney Tansill.
Colonel Tansill is the Assistant Quarter Master General for the Ohio Army National
Guard. The Magistrate found the testimony of Ms. Frost highly credible.
Consistent with Ms. Frost’s testimony, Ms. Alexander Wade testified that
Plaintiff's April 6" bid was confusing. In this re-bid, Plaintiff listed the Vendor as Place
Services, Inc. and listed the Account Holder as Jordan Sandvig. [Ex. C, p. 1]. As such,
it appeared that the bid was placed by Mr. Sandvig on behalf of Place Services, Inc.
However, under “Bidder Information’, Plaintiff listed itself. [Ex. C, p. 19]. Even more
confusing was that under “Bidder Information’, Plaintiff listed V-Line as “Bidder
Information: 1” and Place as “Bidder Information: 2.” As a result, she discussed the
issues with her Project Manager and her Director, Colonel Tansill. Following this
discussion, a decision was made to consult with their legal counsel and the State
ultimately rejected Plaintiff's bid. On redirect, Ms. Alexander-Wade stated that the
reason Plaintiff's bid was rejected was because Plaintiff's LLC did not bid on the Project.
As stated above, Ms. Alexander-Wade indicated that as far as reviewing bids,
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everything she does is clerical and her main function when reviewing bids is to go down
a list and check boxes. The April 21, 2023 rejection letter sent to Plaintiff went out under
her name because she is the Project Coordinator being directed to so and that her job
was to “push this paper out.” The Magistrate found the testimony of Ms. Alexander-
Wade credible.
Colonel Tansill also testified that Ms. Alexander-Wade did not have authority to
reject any bid. Rather, she was responsible for gathering information and passing it
along. He testified that Plaintiffs March 6'" and April 6"" were the same and had the
same issues as far as the State was concerned. For the bids, the staff had concerns
with Plaintiff's bid and briefed him on their concerns. Based on the issues, the State’s
attorneys became involved and gave great guidance which led to the ultimate rejection
of Plaintiff's bid based on the Plaintiff LLC’s lack of experience and financials. The
Magistrate found the testimony of Colonel Tansill credible.
On April 21, 2023, Plaintiff objected and protested the rejection of its bid. [Ex. F].
In its letter pretesting its bid rejection, Plaintiff asserted that the experience and
financials of Plaintiff's joint venturers should have been considered and Plaintiff
requested a meeting with the Contracting Authority to discuss the objections. [Id.]. The
bid protest meeting was held with Plaintiff and the State virtually via Teams on April 28,
2023. Mr. Herweyer testified that the meeting was very meaningful and that he asked
the State if Plaintiff could do anything to cure the issues. Ms. Alexander-Wade testified
that Plaintiff was given every opportunity to say their peace.
Plaintiff was given the opportunity to submit additional documents of its
experience and financials by May 1, 2023. Accordingly, Plaintiff timely submitted what
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Mr. Herweyer called a Bid Clarification Statement. [Ex. G]. Like the bids, the Bid
Clarification letter was reviewed by Ms. Alexander-Wade, Colonel Tansill, and the
State’s legal counsel. Testimony, including that of Mr. Herweyer, and a review of the
Bid Clarification Statement show that the Bid Clarification Statement set forth the
experience and financials of the joint venturers and not Plaintiff's LLC. As a result, the
State affirmed its decision to reject Plaintiffs bid as non-responsible in a letter dated
May 11, 2023. [Ex. I]. That letter stated the following:
The Adjutant General Department has reviewed your bid protest for the
project, to include the additional documents submitted on May 1, 2023, and
the evaluation of information submitted by Thornton-Place Contractors JV,
LLC.
Pursuant to Section 3.6 of the Instructions to Bidders, this letter affirms the
Adjutant Geral’s decision that Thornton-Place Contractors JV, LLC bid, after
review and evaluation of the additional materials submitted for the above
project, is still deemed as non-responsible for this project and is therefore
rejected pursuant to Section 9.312 of the Ohio Revised Code.
Unfortunately nothing in the additional information submitted by Thornton-
Place Contractors JV, LLC to the Adjutant General's Department changed
this determination. You submitted the bid as Thornton-Place Contractors JV,
LLC, a separate legal entity. The bid specifications required documentation
about the financial background and construction experience of the bidder.
Unfortunately, we did not receive records with your bid or in the additional
materials that documented Thornton-Place Contractors JV, LLC’s
construction containing experience or that included its financial records.
Thank you for attending the Teams meeting on April 28"" and submitting the
additional information for review on May 1, 2023.
[Ex. I].
Based on the credible evidence set forth above at length, the Magistrate finds
that the State found Plaintiff to be a non-responsible bidder and rejected Plaintiff's April
6, 2023 bid based on insufficient experience, conduct and performance, and financial
history/condition of Plaintiff's LLC. The Magistrate finds that the ultimate decision to
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reject Plaintiffs bid and award the contract to Miles was made by Colonel Tansill after
consultation with legal counsel. The Magistrate further finds that the State’s decision to
reject Plaintiffs bid was not arbitrary, unreasonable, or unconscionable and was not
based on unannounced criteria or an abuse of discretion. As such, the Magistrate finds
that Plaintiff failed to meet its burden that it is entitled to declaratory judgment in this
case. Since the Magistrate finds that the State lawfully rejected Plaintiff's April 6" bid,
she accordingly finds that Plaintiff is not entitled to a permanent injunction because
Plaintiff has not prevailed on the merits of the claim and, therefore, will not suffer
irreparable harm if the injunction is denied. Furthermore, since Miles was lawfully
awarded the contract, the public interest would not be served, and third parties would be
unjustifiably harmed if the injunction was granted.
DECISION
Based on the Findings of Fact and Conclusions or Law set forth above, Plaintiffs
request for Declaratory Judgment and Injunctive Relief should be DENIED.
Counsel for the Ohio Adjutant General’s Department shall prepare and submit a
Judgment Entry to Judge Lynch pursuant to Local Rule 25.01
A PARTY SHALL NOT ASSIGN AS ERROR ON APPEAL THE COURT’S ADOPTION
OF ANY FACTUAL FINDING OR LEGAL CONCLUSION, WHETHER OR NOT
SPECIFICALLY DESIGNATED AS A FINDING OF FACT OR CONCLUSION OF LAW
UNDER CIV.R. 53(D)(3)(a)(ii), UNLESS THE PARTY TIMELY AND SPECIFICALLY
OBJECTS TO THAT FACTUAL FINDING OR LEGAL CONCLUSION AS REQUIRED
BY CIV.R. 53(D)(3)(b).
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Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O54 IN THE COURT OF COMMON PLEAS OF FRANKLIN COUNTY, OHIO CIVIL DIVISION THORNTON-PLACE O CASE NO. 23CVH05-3434 CONTRACTORS JV, LLC, ] PLAINTIFF, O JUDGE LYNCH I vs. O MAGISTRATE HUNT I THE OHIO ADJUTANT GENERAL’S DEPARTMENT, et al., I DEFENDANTS. 0 MAGISTRATE’S DECISION This matter was initiated via a complaint filed by Plaintiff Thornton-Place Contractors JV, LLC’s (“Thornton” or “Plaintiff’?) on May 15, 2023, against Defendants The Ohio Adjutant General’s Department (“Adjutant General”) and the Ohio Army National Guard (“National Guard”) (collectively the “State” or “Defendants”). The subject of the complaint is the award of a contract (“Contract”) for a construction project known as the Rickenbacker Army Enclave Readiness Center (“Project”). Count One of the complaint is for Declaratory Judgment alleging that Plaintiff is entitled to a declaratory judgment that the State acted arbitrarily, unreasonably and unconscionably in rejecting Plaintiff's bid based on unannounced criteria. Count Two is for Injunctive Relief alleging that Plaintiff is entitled to temporary, preliminary and permanent injunctive relief in equity against the State enjoining and restraining them from further pursuing the Contract for the construction of the Project. The Court denied Plaintiff's request for a Temporary Restraining Order on May 16, 2023. On May 17, 2023, Miles-McClellan Construction Co. (“Miles” or “Intervenor’), the successful bidder on the Project, filed a Motion to Intervene As a Defendant which was granted on June 1, 2023. On June 12, 2023, the Court granted the State’s Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O5 unopposed motion to combine the preliminary injunction hearing with the trial on the merits. Pursuant to Civil Rule 53 and Loc. R. 99.02, the matter was referred to this Magistrate. The Hearing/Trial was held on June 21 and 23, 2023, in Courtroom 7D and was recorded by electronic means. Plaintiff was represented by attorney W. Blair Lewis. Plaintiff presented the testimony of Willis Herweyer, Michael Russell, Tambra Alexander-Wade, George McCann, and Jeff Amason. The State was represented by attorneys Jerry Kasai and Howard Harcha and presented the testimony of Tambra Alexander-Wade, Kevin Brinckerhoff, Troy Place (via deposition), Anne Frost, and Colonel Rodney Tansill. Intervenor presented the testimony of Matthew Recchiuti. The parties stipulated that the following exhibits were admitted into evidence: A, A1, A2, and B through W. Intervenor offered Exhibits X, Y, Z, AA, BB and DD which were admitted into evidence. The parties were ordered to submit and file Proposed Findings of Fact and Conclusions of Law by July 7, 2023. This Magistrate has reviewed the parties’ respective filings. Having weighed the evidence submitted during the hearing, having read and reviewed the exhibits and having applied the required law, this Magistrate hereby renders the following decision: FINDINGS OF FACT AND CONCLUSIONS OF LAW This Magistrate’s Findings of Fact are based on the testimony of the witnesses and the exhibits introduced into evidence. This Magistrate reviewed all the exhibits and considered each as to its weight and credibility. The credibility of the witnesses was considered. The credibility of a witness is based upon the appearance of the witness Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O5 upon the stand; his/her manner of testifying; the reasonableness of the testimony; the opportunity he/she had to see, hear and know the things concerning which he/she testified; his/her accuracy of memory; frankness (or lack of it); intelligence, interest and bias (if any); together with common sense and all the facts and circumstances surrounding the testimony. Of importance in deciding the Findings of Facts, this Magistrate notes that she is free to believe all, some, or none of the testimony of each witness appearing before her. State v. Ellis, 8" Dist., Cuyahoga No. 98538, 2013-Ohio- 1184. A preliminary injunction is an extraordinary remedy; therefore, the moving party has a substantial burden to meet in order to be entitled to the injunction. Sinoff v. Ohio Permanente Med. Group, 146 Ohio App. 3d 732, 2001 Ohio 4186, 767 N.E.2d 1251, citing Ormond v. Solon (Oct. 18, 2001), Cuyahoga App. No. 79223, 2001 Ohio App. LEXIS 4654. The moving party must establish a right to the preliminary injunction by showing clear and convincing evidence of each element of the claim. Sinoff v. Ohio Permanente Med. Group, 146 Ohio App. 3d 732 (8"" Dist. 2001), citing Vanguard Transp. Sys., Inc. v. Edwards Transfer & Storage Co., Gen. Commodities Div., 109 Ohio App.3d 786 (10"" Dist. 1996). “Clear and convincing evidence is that measure or degree of proof which will produce in the mind of the trier of facts a firm belief or conviction as to the allegations sought to be established. It is intermediate, being more than a mere preponderance, but not to the extent of such certainty as is required beyond a reasonable doubt as in criminal cases.” Connor Grp. v. Raney, 2nd Dist. Montgomery, 2016-Ohio- 2959, J] 20, 2016 Ohio App. LEXIS 1836, *17 (May 13, 2016) (internal citations omitted). In determining whether to grant a preliminary injunction, a court must consider: Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O57 (1) whether there is a substantial likelihood that the plaintiff will prevail on the merits of its claims; (2) whether the plaintiff will suffer irreparable harm if the injunction is denied; (3) whether third parties will be unjustifiably harmed if the injunction is granted; and (4) whether the public interest will be served if the injunction is granted. Hydrofarm, Inc. v. Orendorff, 2008-Ohio-6819, {118 (10thDist.), quoting Vanguard Transp. Systems, Inc. v. Edwards Transfer & Storage Co., 109 Ohio App.3d 786, 790 (10thDist.1996); Valco Cincinnati, Inc. v. N&D Machining Serv., Inc., 24 Ohio St.3d 41 (1986); Corbett v. Ohio Building Authority, 86 Ohio App.3d 44, 49 (10thDist.1993). See also Thomas J. Dyer Co. v. Franklin County Convention Facilities Authority, 61 Ohio Misc.2d 132, 133-34 (Franklin Cty.C.P.1990). The primary goal of preliminary injunctive relief “is to preserve the status quo pending final determination of the matter.” Ohio Urology, Inc. v. Poll, 72 Ohio App.3d 446, 454 (10" Dist.1991). Moreover, the party seeking injunctive relief must establish a right to the preliminary injunction by showing clear and convincing evidence of each element of the claim. Vanguard, supra at 790; Cleveland v. Cleveland Elec. Illum. Co., 115 Ohio App.3d 1, 14 (10thDist.1996). In determining whether to grant injunctive relief, no one factor is dispositive; the four factors must be balanced with the “flexibility which traditionally has characterized the law of equity.” /d. “When there is a strong likelihood of success on the merits, preliminary injunctive relief may be justified even though a plaintiff's case of irreparable injury may be weak. In other words, what [a] plaintiff must show as to the Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O58 degree of irreparable harm varies inversely with what [a] plaintiff demonstrates as to its likelinood of success on the merits.” /d. The purpose of a preliminary injunction is to preserve a status between the parties pending a trial on the merits. Consun Food Indus., Inc. vv. Fowkes, 81 Ohio App.3d 63 (9"" Dist. 1991). In this matter, the Court consolidated the hearing on the preliminary injunction with a hearing on the merits for the permanent injunction pursuant to Civil Rule 65(B). “An injunction is an extraordinary remedy in equity where there is no adequate remedy available at law. It is not available as a right by may be granted by a court if it is necessary to prevent a future wrong that the law cannot.” Garono v. State, 37 Ohio ST.3d 171, 173 (1988). “A permanent injunction is not considered an interim remedy. It is issued after a hearing on the merits in which a party has demonstrated a right to relief under the applicable substantive law.” Procter & Gamble Co. v. Stoneham, 140 Ohio App.3d 260, 267-268 (1% Dist. 2000). A party must prove that entitlement to the requested relief by clear and convincing evidence. /d. at 268. “Clear and convincing evidence is that measure or degree of proof which will produce in the mind of the trier of facts a firm belief or conviction as to the allegations sought to be established.” Cross v. Ledford, 161 Ohio St. 469, 477 (1954). The party seeking a permanent injunction must also demonstrate that the injunction is necessary to prevent irreparable harm and that no adequate remedy at law is available. Stoneham at 267. Speculative harm will not suffice. Camp v. Washington Community Bd., Inc. v. Rece, 104 Ohio App.3d 750, 754 (1 Dist. 1995). Plaintiff failed to meet its burden that it is entitled to declaratory judgment and a permanent injunction in this case wherein it alleged that the State acted arbitrarily, Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O5 unreasonably and unconscionable in rejecting Plaintiff's bid based on unannounced criteria and awarded the contract to Miles. The lack of an announced standard and priority of miscellaneous considerations in public bidding allows unbridled discretion and political favoritism. City of Dayton, es. Rel. Scandrick v. McGee, 67 Ohio St.2d 356 (1981). Ohio Supreme Court precedence provides that the utilization of unannounced criteria in selecting a bidder constitutes an abuse of discretion that warrants the issuance of a permanent injunction against the entering into a contract with the higher bidder. Id. “The meaning of the term ‘abuse of discretion’ * * * connotes more than an error of law or of judgment; it implies an unreasonable, arbitrary or unconscionable attitude ***.” Steiner v. Custer, 137 Ohio St. 448, paragraph two of the syllabus (1940); Connor v. Connor, 170 Ohio St. 85 (1959); Rhode v. Farmer, 23 Ohio St.2d82 (1970); and State v. Adams, 62 Ohio St.2d 151 (1980). Arbitrary means “without adequate determining principle; * * * not governed by any fixed rules or standard.” Black’s Law Dictionary (5 Ed.). Unreasonable means “irrational.” /d. Plaintiff is a Georgia limited liability company that is a joint venture between Place Services, Inc. (“Place”) and V-Line Services, Inc. (“V-Line’). Its Certificate of Organization was filed with the state of Georgia on October 15, 2020. Plaintiff registered to do business in Ohio with the Ohio Secretary of State on May 15, 2023. [Ex. Q]. Mr. Herweyer is the president and majority owner of V-Line. Plaintiff is majority controlled by V-Line. Place is a minority partner of Plaintiff. The current joint venture agreement for Plaintiff was executed on March 31, 2023, and was signed by Mr. Herweyer on behalf of V-Line and Tony Place on behalf of Place as its president. Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O60 V-Line is an architectural, engineering and construction firm with approximately 45 employees. At the time of the hearing, V-Line was currently performing work in Ohio which included federal contracts at Rickenbacker, a project at the Veteran Administration’s medical center in Cincinnati, and three projects at the Veteran Administration's medical center in Dayton. Place is also an architectural, engineering and construction firm based in Canton, Georgia. It has approximately 500 employees and eight offices, one of which is a federal division in Lewis Center, Ohio. Place does primarily commercial retail construction and also does work with local and state governments. At the time of the hearing, it had done work in Ohio for Westerville City School District, Delaware School System, and the Tri-Township Fire Station in Delaware. The Adjutant General is an agency of the State of Ohio created by the General Assembly pursuant to R.C. 5913.01. The National Guard was created by Chapter 5919 of the Revised Code and is under the command of the Adjutant General. R.C. 5913.01(A)(12). The Project is a proposed 42,000 square foot facility to be built for the Adjutant General at Rickenbacker Air National Guard base (“Rickenbacker”), to be utilized by the Ohio National Guard. When completed, the Project will have space for office administration, storage, educational classrooms, military training, an assembly center, the requisite parking, additional utilities and outdoor space. The hard cost for the Project was estimated in excess of $13 million. The current facilities utilized by Defendants were constructed in the 1950’s and were built for Lockbourne Air Force Base and not for Defendants’ current mission. The current facilities are in disarray and need to be torn down or replaced. The current Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O61 facility is short 70,000 square feet and the Readiness Center will be able to serve a brigade or battalion. The new facility will house the armory or Readiness Center for the Ohio National Guard. The Contract for the construction of the Project was originally bid on March 6, 2023. Plaintiff and Miles both submitted a timely bid. On March 9. 2023, the Adjutant General published a Notice of All Bids Rejected for the Project which provided the following in relevant part: Please take notice that all bids for the project noted above are hereby rejected. The project will be re-bid at a future date on Bid Express. * * * As provided in Section 153.09 of the Ohio Revised Code, this work will be re-advertised ONE TIME ONLY. We appreciate your interest in bidding State work and we hope that you will bid on future State projects. If you have any questions or concerns regarding this matter, contact the Project Coordinator, Tambra Alexander- Wade * ** R.C. 153.09 states that, “(i)f in the opinion of the owner * * *, the award of a contract to the lowest responsive and responsible bidder is not in the best interests of the state, the ” owner may accept another bid so opened or reject all bids, and advertise for other bids. R.C. 153.09. No evidence was presented that Plaintiff nor any other bidder objected to the March 9"" rejection of all of the bids. The Magistrate also notes that nowhere in Plaintiff's complaint does it claim that the March 9" rejection was contrary to law. Additionally, the March 9" bid was not even presented to the Magistrate and wasn't offered or admitted into evidence. The Project was re-bid, and the subsequent bids were due by 2:00 p.m. on April 6, 2023. Plaintiff was the low apparent bidder and Miles was the second low apparent 8 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 06 bidder. Plaintiff's bid was $13,247,400.00 and Miles’ bid was $13,317,440.00. [Ex. V] It is uncontested that joint ventures were permitted to bid on the Project. Anne Frost, the Chief Planning and Procurement Officer for the Adjutant General’, was involved in the initial bid and re-bid. She testified that she has experience with joint ventures and that joint ventures were allowed to submit bids on the Project. Furthermore, Section 6.1.11 in the Conditions Precedent for Execution of Contract specifically provides that “(i)f the Bidder is a joint venture, it must submit the executed agreement between the joint venturers describing the division of services/work and percentage of contract for each company, and a Power of Attorney which authorizes one or more individuals to bind the joint venture and each individual joint venturer to Contract Modifications.” [Ex Al. It is also uncontested that although federal funds, as well as state funds, were being utilized to fund the Project, that the Project is conducted by and was bid as a State of Ohio project, meaning the State of Ohio contracting processes apply to the Project. Per the Project Manual, bids were being received in compliance with section 153.03 of the Ohio Revised Code. The Bid Documents, which include the Instructions to Bidders, set forth the criteria and process for the Adjutant General to evaluate the bids it received. [Ex. A]. The Instruction to Bidders provides in relevant part: 3.5 Bid Evaluation Procedure 3.5.1 The Contract shall be awarded to the lowest responsive and responsible Bidder as determined in the discretion of the Contracting Authority, or all Bids may be rejected in accordance with Applicable Law * * * ' Ms. Frost was promoted to this position on May 8, 2023, from her prior position as Master Planner for the Adjutant General. 9 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 06 3.5.3 In determining whether a Bidder is responsible, factors to be considered Include, without limitation: 3.5.3.1 preferences required by law, where applicable; 3.5.3.2 the experience of the Bidder; 3.5.3.3 the financial condition of the Bidder; 3.5.3.4 the conduct and performance of the Bidder on previous Contract, including compliance with Equal Employment Opportunity in the Construction Industry Administrative Rules, OSHA and Prevailing Wage laws, and demonstration of good faith effort to participate in the EDGE Business Development program, or actual participation in the EDGE Business Development program, or both as indicated in the ORC and the Ohio Administrative Code; 3.5.3.5 the facilities of the Bidder; 3.5.3.6 the management skills of the Bidder, including the capability of the Bidder to construct and manage the entire Project, including but no limited to the plumbing, fire protection, heating, ventilating and air conditioning, and electrical branches or classes of the Work; and 3.5.3.7 the Bidder’s ability to execute the Contract properly, including past performance of the Bidder and the Subcontractors that the Bidder proposes to use on the Project. * * * 6.1 Conditions Precedent for Execution of Contract 6.1.1 The successful Bidder must submit the items in this Section 6.1 to the Contracting Authority before executing the Agreement. 6.1.2 Bond, and to support the Bond, a Certificate of issued by the Ohio Department of Insurance, showing the Surety is licensed to do business in the State of Ohio. 6.1.3 Ohio Workers’ Compensation Certificate. 6.1.4 Certificate of Compliance with Affirmative Action Programs, issued by the Equal Opportunity Coordinator. * * * 6.1.5 Certificate of Insurance (ACORD) form is acceptable) and copy of additional Insured or loss payee endorsement. * * * 10 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O64 6.1.6 If a Bidder is a foreign corporation (e.g. not incorporated under the laws of Ohio) it must submit a Certificate of Good Standing from the Ohio Secretary of State showing the right of the Bidder to do business in the state of Ohio * * * 6.1.8 Evidence that the Bidder is enrolled in, and in good standing in, a DFSP approved by the OBWC. * * * 6.1.11 If the Bidder is a joint venture, it must submit the executed agreement between the joint venturers describing the division of services/work and percentage of contract for each company, anda Power of Attorney which authorizes one or more individuals to bind the joint venture and each individual joint venturer to Contract Modifications. [Ex. Al. The Instructions to Bidders state that the above-listed Conditions Precedent needed to be submitted within 10 days of the date of the Notice of Intent to Award and that the execution of the Contract required compliance with the Conditions Precedent. [Id.]. The Magistrate notes that the State presented testimony by Ms. Alexander-Wade and Ms. Frost that Plaintiff did not submit documentation listed under the above Conditions Precedent for Execution of Contract such as an Ohio Workers’ Compensation Certificate, a Certificate of Compliance with Affirmative Action Programs, and the agreement between the joint venturers describing the division of services/work and percentage of contract for each company. Plaintiff admitted that it doesn’t possess a valid Certificate of Compliance with Affirmative Action Programs issued by the Ohio Department of Development pursuant to R.C. 9.47. [Ex. R, p. 3]. Mr. Herweyer testified that Plaintiff did not possess a current Worker's Compensation Certificate. However, 11 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 06 Plaintiff never received a Notice of Intent to Award. Accordingly, Plaintiff was not required to submit the Conditions Precedent items. More importantly, whether or not Plaintiff was able to comply with the Conditions Precedent, such compliance was not the basis for the State’s rejection of Plaintiff's bid. The basis was set forth in a letter dated April 14, 2023 (“Rejection Letter”) which states: Dear Mr. Herweyer: The Adjutant General has completed its bid evaluation for the above project, including the Adjutant General's review and evaluation of information submitted by Thornton-Place Contractors JV, LLC., as well as AECOM’s review and recommendation. Pursuant to Section 3.6.1 of the Instruction to Bidders, this letter serves as the Adjutant General’s notice that Thornton-Place Contractors JV. LLC., bid for the above project is deemed as non-responsible for this project and is therefore rejected. The non-responsibility determination is based on the Adjutant Generals finding that Thornton-Place Contractors JV, LLC., does not have the necessary experience for this project, including, but not limited to, Thornton- Place Contractors JV, LLC., failure to have the experience and financial history required by the bid documents. See Instructions to Bidders sections as follows: 3.5.3.2 the experience of the Bidder. 3.5.3.3 the financial condition of the Bidder. 3.5.3.4 the conduct and performance of the Bidder on previous Contracts, including compliance with Equal Employment Opportunity in the Construction Industry Administrative Rules, OSHA and Prevailing Wage laws, and demonstration of good faith effort to participate in the EDGE Business Development program, or actual participation in the EDGE Business Development program, or both, as indicated in the ORC and the Ohio Administrative Code. 3.5.3.5 the facilities of the Bidder. 3.5.3.6 the management skills of the Bidder, including the capability of the Bidder to construct and manage the entire Project, including but not limited to the plumbing, fire protection, heating, ventilating and air conditioning, and electrical branches or classes of the Work; and 3.5.3.7 the Bidder’s ability to execute the Contract properly, including past performance of the Bidder and the Subcontractors that the Bidder proposed to use on the Project. 12 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 06 To the extent that Thornton-Place Contractors JV, LLC., disagrees with the Adjutant General's rejection, an objection may be filed pursuant to the procedures set forth in Paragraph 3.6.3 of the Instructions to Bidders. If Thornton-Place Contractors JV, LLC., chooses to object to the determination, then the Adjutant General will promptly schedule a bid protest meeting. Sincerely, Tambra Alexander-Wade Project Coordinator [Ex. E]. Plaintiff argues that it was a responsible bidder because the joint venturers Place and V-Line, together have the requisite experience, conduct and performance, and financial history/condition for the Project. They argue that the State used unannounced Criteria to reject Plaintiff's bid because “(n)owhere to the Instructions to Bidders state that an LLC is not permitted. * * * The Instructions to Bidders are totally silent on the issue of whether a bidder needs to be an LLC, S-Corp, etc... .” [Plaintiff's Proposed Findings of Fact and Conclusions of Law, p. 10]. However, the State did not reject Plaintiff's bid because it is an LLC. Nor does it assert that an LLC was not permitted to bid on the Project. Rather, the State argues that Plaintiff, as an LLC, is a separate legal entity than the individual joint venturers. As a result, it claims that it appropriately limited its evaluation of Plaintiff under the factors listed in 3.5.3 of the Instructions to Bidders to Plaintiff as an LLC and not the combined factors of Place and V-Line. This Magistrate agrees with the State’s determination that Plaintiff was a non-responsible bidder. The definitions section of the Bid Documents defines “Bidder” as “(a) person that submits a Bid.” [Ex. A-1]. A joint venture is “an association of persons with intent, by 13 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 067 way of contract, express or implied, to engage in and carry out a single business adventure for joint profit, for which purpose they combine their efforts, property, money, skill and knowledge, without creating a partnership, and agree that there shall be a communhity of interest among them as to the purpose of the undertaking, and that each coadventurer shall stand in the relation of principal, as well as agent, as to each of the other coadventurers * **.” A/ Johnson Construction Co. v. Kosydar, 42 Ohio St.2d, 29 (1975). The rule in Ohio is that partnership law governs joint ventures. Cominsky v. Malner, 11" Dist. No 98-L-242, citing Vargo v. Clark, 128 Ohio App.3d 589, 595 (1998). Essentially a joint venture is a partnership entered into for a single transaction or limited period of time. Bus/erv. D & H Mfg., 10" Dist. No. 91AP-1175 (1992). Hence, courts generally apply principles of partnership law to govern the relationship. /d., citing A/ Johnson, supra, at 32. However, Plaintiff chose to establish itself as an LLC and in doing so created a completely different legal entity than a joint venture. As an LLC, Plaintiff is a separate legal entity under Ohio Law. R.C. 1706.04. Under Georgia law, “Limited liability company’ means a limited liability company formed under this chapter.” OCGA 14-11- 101. Also, Georgia law provides that each limited liability company formed in this state shall have the same powers as any person has to do all things necessary to carry out its purpose, business, and affairs. OCGA 14-11-202. Mr. Amason, general counsel for Place and V-Line, testified that an LLC stands as a person in the eyes of the law. The Magistrate finds that Plaintiff is a separate legal entity from Place and V-Line. Plaintiff is the “Bidder” as defined by the Instructions to Bidders and the bid documents specifically state that the determination of responsibility of the Bidder is based upon the experience 14 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 068 and financial condition of the “Bidder.” Likewise, R.C. 9.312(B) provides that the responsibility of a “Bidder” is to be determined upon the experience and financial condition of the “Bidder.” [Ex. S]. Mr. Herweyer agreed that neither Place nor V-Line submitted the bid. Plaintiff submitted the bid. With its bid, Plaintiff submitted a document titled Bidder’s Qualifications which was signed on February 23, 2023. [Ex. K]. That document required the Plaintiff to provide its overall experience performing the trades bid, its relevant facilities and major equipment, and ongoing projects and projects completed in the last 5 years which are similar in cost and type to the Project. Plaintiff's responses only provided information for Place or V-Line and none of the answers applied to Plaintiff's LLC. [Id.]. Consistent with this fact is Mr. Herweyer’s testimony that Plaintiff's LLC has not received any contracts or performed any jobs in Ohio, has not performed any jobs whatsoever, does not have any field employees, does not own any equipment, has a bank account (but there is no activity on the account), and has no existing financials. In its Proposed Findings of Fact and Conclusions of Law, Plaintiff spends a great deal of time arguing that Ms. Alexander-Wade made the decision to reject Plaintiff's bid. However, the Magistrate finds that this argument is not supported by any credible evidence. In fact, the evidence was clear that Ms. Alexander-Wade did not have the authority to reject any bid. The Magistrate notes that she found the testimony of Ms. Alexander-Wade to be credible. She testified that she doesn’t make the decision regarding bids, and she has to run everything through her manager. She stated that everything she does is clerical and her main function when reviewing bids is to go down 15 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - 06 a list and check boxes. Ms. Alexander-Wade’s testimony showed that she incorrectly believed that Plaintiff had to be registered with the Ohio Secretary of State and that she considered Plaintiff's lack of registration as a factor in the rejection of Plaintiff's bid. However, she stated numerous times in her testimony that the main reason the State rejected Plaintiff's bid was because of the lack of experience and qualifications of Plaintiff's LLC. It is uncontested that Plaintiff's March 3" and April 6" bids were substantively the same regarding its Bidder Qualification submissions. [Ex. K]. Michael Russell is the architect/project manager for AECOM and the architect/engineer for the Project. He testified that he only reviewed Plaintiffs bid but was not involved in the evaluation of the bid. When he reviewed Plaintiffs bid, he noted that Plaintiff's bid provided experience for Place and V-Line and not for Plaintiff's LLC. He stated that had he been involved in the evaluation, unless Plaintiff's LLC had the requisite experience, not the independent joint venturers, he would not have considered the bid. Ann Frost became employed as the Chief Planning and Procurement Officer to the Adjutant General’s Office on May 8, 2023. As such, she is Ms. Alexander-Wade’s current Manager. At the time of the bids at issue, Ms. Frost was the Master Planner for the Adjutant General’s Office, but Ms. Alexander-Wade consulted Ms. Frost about Plaintiff's bids as Ms. Alexander-Wade knew Ms. Frost was assuming the new role of her manager. Both Ms. Alexander Wade and Ms. Frost testified that both Plaintiff's initial bid and re-bid on April 6" were very confusing. Again, as stated above, Ms. Frost testified that she has experience with joint ventures and that joint ventures were eligible to bid on and be awarded the contract. Ms. Frost testified that in the over five years she 16 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O70 has reviewed bids she has never seen one as confusing as Plaintiff's. She testified that the concern with Plaintiff's April 6" bid was that it the bid appeared to be from a joint venture, but in actuality it was from an LLC, and that the bid appeared to be from multiple bidders. [Ex. C]. She testified that it was not clear that Plaintiff's LLC had the necessary experience and qualifications for the Project. She stated that due to the confusion, she and Ms. Alexander-Wade elevated the matter to their legal counsel, the Ohio Attorney General’s Office. After consulting with the attorneys, Ms. Frost said there was an internal meeting prior to rejecting Plaintiff's bid. Finally she testified that the ultimate decisions in the rejections of Plaintiff's bids lied with Colonel Rodney Tansill. Colonel Tansill is the Assistant Quarter Master General for the Ohio Army National Guard. The Magistrate found the testimony of Ms. Frost highly credible. Consistent with Ms. Frost’s testimony, Ms. Alexander Wade testified that Plaintiff's April 6" bid was confusing. In this re-bid, Plaintiff listed the Vendor as Place Services, Inc. and listed the Account Holder as Jordan Sandvig. [Ex. C, p. 1]. As such, it appeared that the bid was placed by Mr. Sandvig on behalf of Place Services, Inc. However, under “Bidder Information’, Plaintiff listed itself. [Ex. C, p. 19]. Even more confusing was that under “Bidder Information’, Plaintiff listed V-Line as “Bidder Information: 1” and Place as “Bidder Information: 2.” As a result, she discussed the issues with her Project Manager and her Director, Colonel Tansill. Following this discussion, a decision was made to consult with their legal counsel and the State ultimately rejected Plaintiff's bid. On redirect, Ms. Alexander-Wade stated that the reason Plaintiff's bid was rejected was because Plaintiff's LLC did not bid on the Project. As stated above, Ms. Alexander-Wade indicated that as far as reviewing bids, 17 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568 - O71 everything she does is clerical and her main function when reviewing bids is to go down a list and check boxes. The April 21, 2023 rejection letter sent to Plaintiff went out under her name because she is the Project Coordinator being directed to so and that her job was to “push this paper out.” The Magistrate found the testimony of Ms. Alexander- Wade credible. Colonel Tansill also testified that Ms. Alexander-Wade did not have authority to reject any bid. Rather, she was responsible for gathering information and passing it along. He testified that Plaintiffs March 6'" and April 6"" were the same and had the same issues as far as the State was concerned. For the bids, the staff had concerns with Plaintiff's bid and briefed him on their concerns. Based on the issues, the State’s attorneys became involved and gave great guidance which led to the ultimate rejection of Plaintiff's bid based on the Plaintiff LLC’s lack of experience and financials. The Magistrate found the testimony of Colonel Tansill credible. On April 21, 2023, Plaintiff objected and protested the rejection of its bid. [Ex. F]. In its letter pretesting its bid rejection, Plaintiff asserted that the experience and financials of Plaintiff's joint venturers should have been considered and Plaintiff requested a meeting with the Contracting Authority to discuss the objections. [Id.]. The bid protest meeting was held with Plaintiff and the State virtually via Teams on April 28, 2023. Mr. Herweyer testified that the meeting was very meaningful and that he asked the State if Plaintiff could do anything to cure the issues. Ms. Alexander-Wade testified that Plaintiff was given every opportunity to say their peace. Plaintiff was given the opportunity to submit additional documents of its experience and financials by May 1, 2023. Accordingly, Plaintiff timely submitted what 18 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 OG568 - O7 Mr. Herweyer called a Bid Clarification Statement. [Ex. G]. Like the bids, the Bid Clarification letter was reviewed by Ms. Alexander-Wade, Colonel Tansill, and the State’s legal counsel. Testimony, including that of Mr. Herweyer, and a review of the Bid Clarification Statement show that the Bid Clarification Statement set forth the experience and financials of the joint venturers and not Plaintiff's LLC. As a result, the State affirmed its decision to reject Plaintiffs bid as non-responsible in a letter dated May 11, 2023. [Ex. I]. That letter stated the following: The Adjutant General Department has reviewed your bid protest for the project, to include the additional documents submitted on May 1, 2023, and the evaluation of information submitted by Thornton-Place Contractors JV, LLC. Pursuant to Section 3.6 of the Instructions to Bidders, this letter affirms the Adjutant Geral’s decision that Thornton-Place Contractors JV, LLC bid, after review and evaluation of the additional materials submitted for the above project, is still deemed as non-responsible for this project and is therefore rejected pursuant to Section 9.312 of the Ohio Revised Code. Unfortunately nothing in the additional information submitted by Thornton- Place Contractors JV, LLC to the Adjutant General's Department changed this determination. You submitted the bid as Thornton-Place Contractors JV, LLC, a separate legal entity. The bid specifications required documentation about the financial background and construction experience of the bidder. Unfortunately, we did not receive records with your bid or in the additional materials that documented Thornton-Place Contractors JV, LLC’s construction containing experience or that included its financial records. Thank you for attending the Teams meeting on April 28"" and submitting the additional information for review on May 1, 2023. [Ex. I]. Based on the credible evidence set forth above at length, the Magistrate finds that the State found Plaintiff to be a non-responsible bidder and rejected Plaintiff's April 6, 2023 bid based on insufficient experience, conduct and performance, and financial history/condition of Plaintiff's LLC. The Magistrate finds that the ultimate decision to 19 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 OG568 - O7 reject Plaintiffs bid and award the contract to Miles was made by Colonel Tansill after consultation with legal counsel. The Magistrate further finds that the State’s decision to reject Plaintiffs bid was not arbitrary, unreasonable, or unconscionable and was not based on unannounced criteria or an abuse of discretion. As such, the Magistrate finds that Plaintiff failed to meet its burden that it is entitled to declaratory judgment in this case. Since the Magistrate finds that the State lawfully rejected Plaintiff's April 6" bid, she accordingly finds that Plaintiff is not entitled to a permanent injunction because Plaintiff has not prevailed on the merits of the claim and, therefore, will not suffer irreparable harm if the injunction is denied. Furthermore, since Miles was lawfully awarded the contract, the public interest would not be served, and third parties would be unjustifiably harmed if the injunction was granted. DECISION Based on the Findings of Fact and Conclusions or Law set forth above, Plaintiffs request for Declaratory Judgment and Injunctive Relief should be DENIED. Counsel for the Ohio Adjutant General’s Department shall prepare and submit a Judgment Entry to Judge Lynch pursuant to Local Rule 25.01 A PARTY SHALL NOT ASSIGN AS ERROR ON APPEAL THE COURT’S ADOPTION OF ANY FACTUAL FINDING OR LEGAL CONCLUSION, WHETHER OR NOT SPECIFICALLY DESIGNATED AS A FINDING OF FACT OR CONCLUSION OF LAW UNDER CIV.R. 53(D)(3)(a)(ii), UNLESS THE PARTY TIMELY AND SPECIFICALLY OBJECTS TO THAT FACTUAL FINDING OR LEGAL CONCLUSION AS REQUIRED BY CIV.R. 53(D)(3)(b). 20 Franklin County Ohio Clerk of Courts of the Common Pleas- 2023 Oct 04 9:30 AM-23CV003434 0G568