Percipient.ai, Inc. v. United States: The Federal Circuit’s expansion of bid protest task order jurisdiction and standing

The Federal Circuit’s June 7, 2024 decision in Percipient.ai, Inc. v. United States[1] expanded the Court of Federal Claim’s bid protest jurisdiction, and opens the door for increased scrutiny of agencies’ procurement practices involving the use of commercial products and services.

Court of Federal Claims proceedings

Percipient.ai (Percipient), an AI solutions provider, filed a bid protest before the Court of Federal Claims. The protest alleges that the National Geospatial-Intelligence Agency (NGA) and its contractor, CACI, Inc.-Federal, violated 10 U.S.C. § 3453 when, during CACI’s performance of a task order, NGA and CACI did not consider using readily-available commercial and non-developmental software products to fill CACI’s contract requirements before deciding to have CACI develop a custom-made software solution.

Both the government and CACI filed motions to dismiss Percipient’s complaint, alleging that Percipient lacked jurisdiction and standing, and that its protest was untimely. After initially denying the motions, on reconsideration, the Court of Federal Claims vacated its original opinion and granted the motions to dismiss. The court held that the Federal Acquisition Streamlining Act (FASA), which states that the Court of Federal Claims does not possess jurisdiction over protests “in connection with the issuance or proposed issuance of a task or delivery order,” barred jurisdiction over Percipient’s protest.

Federal Circuit proceedings

Percipient appealed to the US Court of Appeals for the Federal Circuit, arguing that the Court of Federal Claims erred in dismissing its protest. Percipient alleged that the protest was not a challenge to the issuance or proposed issuance of a task order – instead, it challenged the NGA’s failure to conduct market research as required by 10 U.S.C. § 3453 during performance of CACI’s task order. The government argued that the lower court’s dismissal was proper, and that there existed additional, alternative grounds to sustain the dismissal. These included that the Court of Federal Claims lacked jurisdiction under the Tucker Act, and that Percipient lacked standing.

The Federal Circuit reversed: it held that Percipient’s protest fell outside FASA’s task order bar, because Percipient's challenge “[did] not assert the wrongfulness of, or seek to set aside, any task order.” Instead, the Federal Circuit concluded that because Percipient’s protest challenged the failure of NGA and CACI to explore a commercial solution, it was not “in connection with the issuance or proposed issuance of a task order.” The Federal Circuit further explained that the Court of Federal Claims’ jurisdictional statute permits it to consider protests of “any alleged violation of statute or regulation in connection with a procurement or a proposed procurement,” which encompasses decisions about how to fill the government’s needs, even after the award of a task order.

In addressing the question of whether Percipient had standing to bring the protest, the Federal Circuit concluded that Percipient possessed standing because it had a substantial opportunity to meet NGA's needs, had NGA and CACI explored possible commercial products and services as required by statute. The Federal Circuit rejected the notion that only direct offerors could challenge procurement decisions.

Key takeaways

The decision provides some key takeaways for industry:

• Percipient has opened the door to protests by indirect suppliers or potential subcontractors challenging violations of federal procurement statutes and regulations that impact the opportunities they have to sell to the government. Given this, companies could benefit from tracking prime contracts under which the company may have subcontract and supplier opportunities, and to identify areas where the company believes it was unreasonably overlooked in a timely manner.


• The court’s determination that a protester may have standing, (ie, be an “interested party”) even if the protester is not challenging the terms of a solicitation, or was not an “actual or prospective” offeror, is an expansive interpretation of the Court of Federal Claims standing requirements – particularly in regards to protests alleging a violation of statute or regulation. Thus, this may provide additional opportunities for to file protests before the Court of Federal Claims, particularly if there is a basis to challenge a violation of statute or regulation, rather than focusing solely on solicitation defects or evaluation challenges.


• The court’s decision establishes that there are limits to the FASA bar – amplifying the need for careful consideration of the protest forum when filing a protest tangentially related to a task order.

For further guidance, please contact the authors, or your DLA Piper relationship attorney.


^{[1] See Percipient.ai, Inc. v. United States, No. 2023-1970, 2024 U.S. App. LEXIS 13884 * (Fed. Cir. Jun. 7, 2024).}