Reference to our disclosure dated 28 June 2012, a U.S. District Court in Alabama, ruling in the case of two U.S.-based affiliates of Public Warehousing Company KSC (Agility), has ordered the U.S. government to act by Dec. 26 to remove suspensions that have prevented the affiliates from seeking U.S. government contracts.
The U.S. District Court’s ruling affirms its decision in June to order the lifting of suspensions of Agility DGS Inc. and Agility International, the plaintiffs in the case.
In its original decision in June, the court said: “The facts in the record are undisputed: plaintiffs were suspended on the sole basis of their affiliation with PWC; no legal proceedings have been initiated against them; and they have remained suspended for thirty-one months – i.e. nearly twice the regulatory limit of eighteen months. Their continued suspension is contrary to law. … therefore, their suspensions must be terminated.”
After its June decision, the court agreed to a request by the government defendants that it temporarily stay its order and reconsider the decision. On Wednesday, the court said that the government was “simply not credible” in its contention that it “did not anticipate” the reasoning behind the June ruling. It questioned the government’s decision to seek reconsideration of the original decision by saying: “There are scores of litigants – especially losing ones – who, after the entry of judgment and with the benefit of hindsight, wish they had pressed one argument over another, or submitted different evidence.”
Agility DGS Inc. and Agility International are among more than 120 PWC/Agility affiliates that were suspended from U.S. government contracting in 2009 when the parent company was indicted in connection with a U.S. government food-supply contract. None of the suspended affiliates are accused of wrongdoing.
The Alabama ruling has no effect on the Prime Vendor food-supply case that prompted the indictment for alleged fraudulent pricing. That case, in which PWC is the defendant, is in pre-trial litigation before a U.S. District Court in Atlanta, Georgia. PWC denies the allegations in the indictment and intends to vigorously contest them in court.