Commonwealth Court OKs Nonmonetary Contract Claims Against Commonwealth in Casino Central Computer RFP Dispute
In a case arising from the award of the contract for the Gaming Board/Department of Revenue’s Central Computer Control System that monitors transactions in slot machines in Pennsylvania’s casinos, the Commonwealth Court has ruled that a claim based on a contract that seeks relief that is nonmonetary in nature (i.e., for declaratory relief and specific performance) can proceed directly in the Commonwealth Court. Scientific Games International, Inc. v. Commonwealth, __ A. 3d __ (380 M.D. 2011, filed Nov. 30, 2011).
Scientific Games outbid GTECH, the existing Central Computer provider, in the RFP process for a new contract. After negotiations following selection as the successful bidder, Scientific executed the contract provided by the Commonwealth, but the Commonwealth thereafter, following a bid protest by GTECH, decided to cancel the RFP as being in the “best interests of the Commonwealth” and extend the GTECH contract. Scientific filed suit against the Commonwealth in the Commonwealth Court and the Commonwealth and GTECH filed preliminary objections, arguing that the Board of Claims has exclusive jurisdiction over such disputes, that even if the Court has jurisdiction Scientific has an adequate administrative remedy under the Procurement Code, that in any event the Court cannot order specific performance in a disappointed bidder dispute, and that Scientific lacks standing because it is a disappointed bidder.
The Commonwealth Court overruled all objections. Rejecting the jurisdictional claim, the Court ruled as a matter of first impression that the Supreme Court’s previous holdings that the Board of Claims has exclusive jurisdiction not only over contract damage claims but also over whether a valid contracts exist, were based on the since-repealed Board of Claims Act and that the 2002 Procurement Code expressly permits pursuit of nonmonetary relief, including a declaratory judgment that a contract exists and specific performance if it does exist, in suits filed in forums other than the Board of Claims. The Court also rejected the adequate administrative remedy claim, finding that a complainant need not use the Procurement Code administrative process for nonmonetary claims. The Court likewise rejected standing claims, finding that Scientific was not a disappointed bidder but an entity that claimed it had an enforceable contract.
Below is a copy of the Court's decision