UK: Access To Confidential Information And Court Documents In Procurement Cases

Last Updated: 17 July 2017
Article by Mark Bassett and Martin Watt

Introduction

Procurement challenges focus on sensitive issues for parties and non-parties to the dispute.  Information about evaluation, the challenger's unsuccessful bid and the winning bid are all likely to be relevant. Both parties and non-parties might therefore find themselves called to reveal commercially sensitive material. Three recent interlocutory judgements in current rail-related cases provide some guidance about the court's approach to these issues.

The first two judgements concern a claim brought by Bombardier Transportation UK Limited (BTUK). It is challenging Merseyrail's decision to buy rolling stock with a value of approx. £710 million and related services from Stadler Bussnang. They are seeking damages from Merseytravel for non-compliance with the procurement rules.

The third judgement concerns a decision made in March 2017 by London Underground Limited and Transport for London (LUL). In this case BTUK was the successful bidder.  It was awarded a contract to supply traction equipment for the Central Line fleet, and the challenger is Alstom Transport UK Limited (Alstom).

First judgement

Background

The first judgement concerns whether case documents like the claim form can be made public.

The background to the judgement is unusual. Representatives of a third-party (another unsuccessful bidder) had written to the court asking for copies of the documents in the court file. Court officials refused, saying "that the whole of the court file had been marked 'private', and that copies would not therefore be made available." The third party then wrote to the judge in charge of the Technical and Construction Court, Mr Justice Coulson, to ask for the documents to be made available. He took a contrary view based on (draft) guidelines for handling procurement cases. He decided the default position should be that the court's file documents should be made available. This prompted the claimant (BTUK) to make a formal CPR 5.4C application for the entirety of its claim form to be treated as confidential. 

Decision

The question went to a hearing to settle what information should be kept confidential. In the hearing,  BTUK conceded the claim form itself should be available, but argued that the supporting annexes contained confidential information and should therefore be kept secret.  Mr Justice Coulson was not satisfied with this argument.  Having reviewed a small sample of the annexes, he decided the confidential information they contained could easily be redacted to avoid any commercial harm.

Implications

This judgement shows: 

  1. The claim form in a procurement challenge and probably much of the supporting annexes will normally be available to third-parties.
  2. This is likely to be of concern to procuring bodies, because of the risk of other unsuccessful bidders making "me-too" type claims. This might occur where there is a systemic error in the evaluation. On the other hand, the tight limitation period of (usually) 30 days might hamper such claims.
  3. Bidders who are aware that a claim has been made, and who have concerns themselves about the conduct of a procurement procedure, should seek to obtain the court file as it is possible there may have been a systemic error in evaluation. 
  4. Bidders who have made a claim should be conscious that the information they put in a claim form could later be released to competitors (unless it can be properly redacted on grounds of confidentiality). 

Second judgement

Background

The second judgement concerns the procurement challenger's access to the winning bidder's tender.

In line with common practice, a confidentiality ring had been set up by consent orders between the parties to the dispute and the successful bidder Stadler. It was to allow documents held by Merseytravel containing confidential information, including about Stadler's bid, to be disclosed.

The consent orders had provided for the parties' counsel and external legal representatives, up to two in-house legal representatives and up to six of BTUK's non-legal external advisors, to be in the confidentiality ring. The consent orders also provided that certain sensitive Stadler bid documents ("Highly Sensitive Documentation") could only be viewed by BTUK's external legal team, and that other parts of Stadler's bid would only be disclosed:

  • in hard copy for storage in a secure environment at BTUK's solicitors' office;
  • in electronic form for review at Merseytravel's office.

Issue to be decided

BTUK wanted the court to vary the original consent orders. First, they wanted everyone in the confidentiality ring to be able to see the Highly Sensitive Documentation, not just their external legal representatives. Second, they wanted to include a current employee in the confidentiality ring. Third, they wanted electronic versions of the Highly Sensitive Documentations to be available at their external legal advisors' offices.

Decision

The court did not allow the BTUK employee to join the confidentiality ring but otherwise found in their favour on the first and third elements of their application.

Having largely succeeded in their application, BTUK sought costs from Merseytravel. The court did not agree but decided that there was a case for a non-party order against Stadler for payment of the costs, because they had refused to agree the variations sought by BTUK.

Implications

This judgement shows:

  1. A challenger may examine fully the treatment of its tender both to confirm its original allegations and to uncover freestanding allegations. The judge recognized this creates the potential for "creep" following from document disclosure.
  2. Internal employees of the challenger may sometimes be allowed into the confidentiality ring but not always. Someone close to or even recently retired who was not, and would not be, involved in the procurement might be suitable. The circumstances of the particular case will be key, and in this case the judge was persuaded by two factors:
    1. The proposed employee has a year until retirement and meanwhile there are several procurement competitions in which BTUK and Stadler will be competitors; and
    2. BTUK's external consultants might be able to understand the material themselves without adding the employee to the confidentiality ring. The question could be put before the court again in future if that proved not to be the case.
  3. It's likely that hard and soft copies of documents will be made available to the confidentiality ring. This is often necessary to view formulae and calculations in the material.
  4. It is open to the court to make costs orders against non-parties to a dispute. Therefore, the successful bidder should take care in considering and presenting its position on confidentiality matters. 

Third Judgement

Background

The third judgement also deals with the claimant's access to documents, but in this case the focus was on the timing of an application for specific disclosure.

LUL awarded a contract for new traction systems for its Central Line fleet to Bombardier in March 2017, and Alstom sought to challenge this result. The start of their claim automatically suspended LUL's ability to enter the proposed contract with the winning bidder, Bombardier.

LUL wanted to lift the contract suspension whereas Alstom wanted specific disclosure of various documents held by LUL. Each party wanted its application to be heard first. LUL contended the usual approach is for an application to lift a suspension to be heard before an application for specific disclosure. Alstom, on the other hand, felt they would be unfairly treated if the application to lift the suspension was heard before they had seen relevant documents they sought in their disclosure. There might be something in the documents that would help them argue the suspension should continue.

Decision

There is no general principle that an application for specific disclosure should be heard after an application for lifting the suspension of a contract award.

On the facts of this case, it was necessary to allow the hearing of the application for specific disclosure first. The correspondence suggested that LUL might have been seeking a potentially unfair advantage by having their application to lift the suspension tried without disclosing documents that might either support or contradict their grounds for seeking this.

An application to lift the suspension would turn on whether it can be shown there is a serious issue to be tried. In this case, it would be inappropriate for the court to decide that point without sight of at least some of the documents that Alstom were asking to see, particularly those about LUL's evaluation of Bombardier's successful tender.

The judgement stressed there is no fixed rule about this. If, for example, there is clearly a serious issue to be tried on the face of the pleadings, then the case for a specific disclosure application to be heard before an application to lift a suspension is less strong. There is also a policy consideration that an application to lift a suspension should be heard as soon as possible.

Implications

Procuring authorities and claimants are likely to have different perspectives on the best way to sequence an application to lift a contract award suspension, and an application for disclosure of documents. There is no fixed rule about the right approach, however. Each case must be judged on its merits. The Court and the parties must balance sometimes competing considerations of fully informed decision making, and the desirability of dealing with decisions about suspensions as soon as possible.

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