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ALLIED PAINTING INC. v. DELAWARE RIVER PORT AUTHO. OF PENN.

July 20, 2004.

ALLIED PAINTING INC.,
v.
DELAWARE RIVER PORT AUTHORITY OF PENNSYLVANIA AND NEW JERSEY.



The opinion of the court was delivered by: MARY A. McLAUGHLIN, District Judge

MEMORANDUM AND ORDER

This dispute arises from the decision by the Delaware River Port Authority of Pennsylvania and New Jersey ("DRPA") not to award a contract to paint the Walt Whitman Bridge to the lowest bidder, Allied Painting, Inc. ("Allied"). Allied claims that DRPA violated its procedural and substantive due process rights and that the decision not to award Allied the contract was arbitrary and capricious.

The defendant filed the present motion to dismiss, arguing that Allied has no property interest entitled to either procedural or substantive due process protection, and procurement decisions of DRPA are not subject to arbitrary and capricious review and, even if they are, Allied fails to allege facts supporting such a claim.

  The Court will grant DRPA's motion to dismiss both the procedural and substantive due process claims. The Court will deny, without prejudice, DRPA's motion to dismiss the arbitrary and capricious claim. DRPA may renew its argument that DRPA's procurement decisions are not subject to arbitrary and capricious review at the summary judgment stage.

  I. Background

  Allied is a New Jersey corporation engaged in the painting of buildings and other structures.*fn1 DRPA is a bi-state agency created by an interstate compact for the purpose of building and maintaining bridges and ports between Pennsylvania and New Jersey. Compl. ¶¶ 1-2.

  In the fall of 2003, DRPA issued an invitation to interested parties to bid on a contract for the painting of the Walt Whitman Bridge. Allied submitted its bid on December 9, 2003, before the deadline for submission. Along with its bid, Allied presented to DRPA a security deposit of $500,000.00. Id. ¶¶ 9, 27. When the proposals were opened publicly, Allied's bid was found to be the lowest. Allied's bid was complete and satisfied the requirements of the contract offered by DRPA. Since the time of the opening of the bids, Allied has presented a performance bond for the remaining value of its bid as required by DRPA. Allied has previously performed as a subcontractor in the painting of the Walt Whitman Bridge. Id. ¶¶ 14-16, 24, 27.

  On December 19, 2003, representatives of DRPA met with officials from Allied to discuss the proposal. At this meeting representatives of DRPA raised concerns that they had with Allied's ability to perform the contract for the price included in their bid. In response, Allied explained how it planned to perform the contract at the price included in the bid and realize a net profit. Id. ¶¶ 30-31.

  DRPA also raised concerns it had with Allied's bonding company. In response, Allied indicated that it was prepared to provide a performance bond from another company. DRPA never requested or compelled Allied to provide the bond from a different source. Id. ¶¶ 32, 33.

  On or about December 24, 2003, Allied orally confirmed to DRPA that it was satisfied with its original bid and could do the work for the amount proposed. Subsequently, around January 13, 2004, the Vice President of Allied contacted the Chief Engineer of DRPA and was told that, in the Chief's view, there was no reason not to award the contract to Allied. Id. ¶¶ 34-35.

  On February 18, 2004, DRPA awarded the contract to another bidder, Jupiter Painting Contracting Co., Inc. ("Jupiter"). Jupiter's bid was in excess of the bid submitted by Allied. Id. ¶ 41.

  II. Analysis

  The Court will discuss in turn the plaintiff's procedural due process claim, substantive due process claim, and ...


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