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COFC Says Fears of Money-Losing Task Orders Aren’t Enough to Win a Protest

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In Active Deployment Systems, LLC v. United States, U.S. Court of Federal Claims, No. 25-968C (Oct. 30, 2025), Active Deployment Systems (ADS) challenged several aspects of the Department of Homeland Security’s (DHS) award of 42 indefinite delivery /indefinite quantity (IDIQ) contracts for detention related services under a solicitation issued by Immigration and Customs Enforcement (ICE). ADS alleged that ICE violated the terms of the solicitation by awarding far more contracts than advertised, and that the solicitation’s pricing structure—which included fixed price caps—was irrational and arbitrary. ADS sought to halt the award of any task orders and urged the Court to find that it had been competitively harmed by the agency’s actions. But the Court disagreed, finding no violation of the solicitation and, most notably, no prejudice, even assuming ADS’ complaints about the competition had merit.

The Decision
The COFC denied the protest, ruling that:

  1. Awarding to 42 Offerors Was Permitted by the Solicitation: ADS argued that the solicitation’s language, stating that DHS intended to award to “five (5) or more” offerors, meant that the agency could not award to 42. The Court disagreed, emphasizing the plain language and concluding that “five or more” can only mean five or more than five. It did not mean “approximately five” as ADS asserted. Bottom line: there was no numerical ceiling on awards, and DHS remained within its discretion by selecting 42 awardees for the IDIQ pool.
  2. No Prejudice from Alleged Pricing Structure Flaws: ADS’ core challenge to the pricing model focused on the solicitation’s contract line item structure and ICE’s pre-established “fair and reasonable” pricing caps. ADS claimed the structure was unclear, that price ceilings were irrational and that offerors could not fairly compete. But the Court found no prejudice. ADS had already been awarded a contract under the procurement for every objective it bid on. Even under the more lenient “non-trivial competitive injury” standard applicable in some pre-award contexts, ADS failed to show how it was competitively harmed by a structure it successfully navigated.
  3. Speculative Harm from Future Task Orders Was Not Enough: ADS asserted that the flawed price caps would prevent it from profitably bidding on future task orders. But the Court found this too speculative to constitute redressable harm. There was no guarantee that ADS would receive task orders, nor that the pricing model would cause losses. The Court noted that IDIQ holders are not required to bid on any particular task order, and that ADS remained free to walk away from any opportunity it found unfavorable.
  4. Protesting While Performing Undermined the Prejudice Argument: Perhaps most critically, ADS told the Court during oral argument it still wanted to perform under the contract, despite claiming the pricing model was unworkable. The Court flagged this contradiction—if the contract was truly flawed and harmful, ADS would seek to exit, not perform. That admission doomed ADS’ argument that the pricing terms caused competitive injury or made the contract unjustifiably risky.

Key Takeaways for Contractors

  1. “Five or More” Means Exactly That: If a solicitation says the agency intends to award to “five or more” offerors, the government has wide discretion and selecting more—or significantly more—than five awardees does not violate the terms.
  2. Courts Demand More Than Hypotheticals: Concerns about future harm, especially in the IDIQ context, must be grounded in concrete, near-term impacts. Speculation about potential loss-making task orders won’t satisfy the prejudice standard.
  3. Price Caps Must Be Irrational and Harmful, Not Just Inconvenient: Even if an agency sets aggressive or unfavorable price ceilings, a protester must show that they were both arbitrary and caused competitive harm. If you’re still bidding or have an award in hand, and aren’t willing to back out when given the chance, your argument weakens.
  4. No Obligation to Bid Equals No Injury: In an IDIQ structure, if you think a task order may be unprofitable, you can simply decline to bid. Courts see that as a built-in safety valve that undercuts many pricing-based protest theories.
  5. Willingness to Perform Despite Perceived Flaws Can Undermine Protest Credibility: If you tell the Court the contract is “unworkable” but aren’t willing to walk away when given the chance, expect skepticism. Courts look at actions as well as arguments when assessing prejudice.