U.S. Army moves forward with Lakota buy despite legal challenge

The U.S. Army may have found a workaround for acquiring new UH-72A Lakota helicopters, even as it waits for a ruling on the subject from the Court of Appeals for the Federal Circuit.

A federal judge barred the Army from proceeding with a sole-source acquisition of 16 UH-72A Lakota helicopters in 2016. The Army appealed the ruling, and is now taking steps to procure up to 35 additional Lakotas. Airbus Helicopters Photo
A federal judge barred the Army from proceeding with a sole-source acquisition of 16 UH-72A Lakota helicopters in 2016. The Army appealed the ruling, and is now taking steps to procure up to 35 additional Lakotas. Airbus Helicopters Photo
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In a “sources sought” notice published Jan. 4, 2018, the Army states that its Utility Helicopter Project Management Office is conducting market research to determine whether there are contractor sources available to supply up to 35 new EC145 aircraft to supplement the Army’s existing fleet.

There’s certainly one such contractor: Airbus Helicopters, Inc., which produces the commercial-off-the-shelf EC145 that is operated by the Army as the UH-72A Light Utility Helicopter (LUH). In its attempt to determine “the feasibility of a competitive acquisition,” the Army notes in its Jan. 4 solicitation that the EC145 technical data package is held by Airbus, and that “responses should address how the aircraft will be produced as a new FAA [Federal Aviation Administration]-certified aircraft without having this data available and without incurring significant additional costs.”

Of course, it is highly unlikely that anyone other than Airbus would be able to provide its proprietary aircraft at a competitive price.

Underpinning the Army’s sources sought notice is specific language in the 2017 Defense Appropriations Act providing for the procurement of 28 Lakota LUHs “in support of ongoing mission requirements at the Army Aviation Center of Excellence at Fort Rucker, the Combat Training Centers, and the Army Test and Evaluation Center.”

A Lakota order would be a boon for Airbus, which has seen LUH production at its facility in Columbus, Mississippi, dwindle in the face of a legal challenge by AgustaWestland North America (now Leonardo Helicopters). According to Airbus spokesperson James Darcy, only three Lakotas remain to be delivered under all prior contracts with the Army.

In a statement, Airbus said it “will certainly respond to the Army EC145 sources sought, which is the first step in meeting a well-documented, longstanding requirement for Lakota helicopters that our customer has said is essential to meet its readiness needs.”

The company added, “Significant obstacles have been laid in the warfighters’ path during the Army’s past efforts to meet its requirements for more Lakotas, and those obstacles have in turn jeopardized the livelihoods of all the American workers who build the Lakota in Mississippi.

“That workforce — more than 40 percent of whom are U.S. military veterans — ended 2017 wondering if the New Year would bring them unemployment. A new contract for them would mean they can continue to build on their unbroken record of on-time, on-cost deliveries to the Army.”

Restructuring Pains

Airbus has already delivered 409 Lakotas since winning the U.S. Army’s LUH competition in 2006. That competition sought an FAA-certified helicopter for operations in non-hostile, non-combat environments, including aerial transport of key personnel, medevac, reconnaissance, and test and training support.

A military version of the civil EC145 helicopter, the UH-72A was competitively selected in 2006 for operations in non-hostile, non-combat environments. Skip Robinson Photo
A military version of the civil EC145 helicopter, the UH-72A was competitively selected in 2006 for operations in non-hostile, non-combat environments. Skip Robinson Photo

In August 2013, the Army’s Chief of Staff issued planning guidance for a controversial Army Aviation Restructure Initiative (ARI) that aimed to “sustain and modernize the aviation fleet within a fiscally constrained environment.” Among other things, the ARI called for replacing the Army’s aging fleet of single-engine Bell TH-67 training helicopters at Fort Rucker, Alabama, with UH-72A Lakotas.

Consistent with the ARI, in April 2014, the Army standardized the UH-72A Lakota as its “institutional training helicopter” in an executive order.

Initially, the Army planned to source some of these training helicopters from the National Guard. As then-Major General Kevin W. Mangum of the U.S. Army Aviation Center of Excellence declared at the time, “The good thing about UH-72s is they’re bought and paid for.”

However, when the National Guard reportedly objected to losing Lakotas, the Army decided to purchase additional aircraft from Airbus. In September 2014, the Army filed a sources sought notice advising that it intended to procure an additional 155 EC145 helicopters on “an other than full and open competitive basis.”

AgustaWestland immediately lodged a legal challenge with the U.S. Court of Federal Claims, asking the court to block the acquisition. In its complaint, AgustaWestland challenged the suitability of the Lakota as a primary flight trainer, and claimed that the government could save more than $330 million by purchasing 255 of its AW119Kx helicopters as trainers, rather than 155 new EC145s.

The Army asked the court to dismiss AgustaWestland’s complaint as “not ripe for review,” as the Army had not yet made a final decision with respect to the competitive process to be used for the procurement. The court declined to dismiss the suit, and stayed proceedings until such time as the government decided whether to issue a “justification and approval” (J&A) for the acquisition.

That J&A finally came in December 2015, when the Army declared its intentions to purchase just 16 Lakotas on an other than full and competitive basis, emphasizing financial and logistical reasons for maintaining a standardized fleet.

AgustaWestland didn’t back down from its legal challenge. As the case proceeded, the Army advised the court in May 2016 that it had identified a need for an additional 97 Lakota helicopters, although it had not yet decided when or how it would procure them.

Oral arguments in the case took place in June 2016. In a ruling issued that August, Judge Susan Braden sided with AgustaWestland, finding that the Army’s declaration of the UH-72A as its “institutional training helicopter,” in keeping with the ARI, was essentially a procurement decision that violated the Competition in Contracting Act (CICA).

Braden issued a preliminary injunction against the purchase of the 16 Lakotas, giving the Army six months to either proceed with a competitive procurement or come up with a revised J&A, or drop the procurement altogether.

A Procurement Loophole?

Instead, the Army appealed the ruling to the U.S. Court of Appeals for the Federal Circuit. In an oral argument before the court in July 2017, Army counsel Anthony Schiavetti contended that Braden exceeded her jurisdictional authority in declaring that the ARI violated CICA.

The Army has already ordered 412 UH-72A helicopters from Airbus, and has identified a need for more than 100 additional Lakotas. Skip Robinson Photo
The Army has already ordered 412 UH-72A helicopters from Airbus, and has identified a need for more than 100 additional Lakotas. Skip Robinson Photo

“All that the ARI does is say we’re going to use these helicopters that we’re using over here for medevac and a variety of different purposes — we’re going to move those down to Fort Rucker and instead use them to train new pilots on this dual-engine helicopter,” Schiavetti said.

“There’s no determination that we’re going to need more helicopters going forward, there’s no determination that if and when we buy helicopters going forward that those will have to be Lakota helicopters.”

Schiavetti argued that Braden should have confined her analysis to the J&A itself. Not only was the broad scope of her injunction “problematic” for future Lakota acquisitions, he said, “it potentially opens the door to a flood of protests that reach into operational policy decisions such as the ARI.”

However, Federal Circuit Judge Todd Hughes pointed out that this line of reasoning could “open up a huge gaping hole” in the federal procurement process. Anytime the Department of Defense decided it wanted to work with a favored manufacturer, “it could have someone unconnected to procurement issue a policy decision that you then rely on to sole source a contract,” he suggested.

Hughes also expressed concern over the Army’s identified need for an additional 97 Lakota helicopters. While the sole-sourcing of a low number of aircraft could more readily be justified on the basis of cost and operational efficiencies, “if we issue a decision upholding your right to do 16 here, how do we contain it so that we’re not giving you a loophole to get around open procurement policies?” he asked Schiavetti.

The Federal Circuit has yet to issue a ruling in the case. In the meantime, however, the specific language relating to the UH-72 Lakota in the Defense Appropriations Act could allow the Army to circumvent the legal battle and move forward with the purchase of Lakota helicopters for training purposes.

“The U.S. Army has clearly expressed a need for more aircraft to accomplish its mission, and the U.S. Congress has accordingly funded the Army’s requirement,” Airbus stated. “We applaud Army leadership for its decisive action in addressing its readiness needs, and the elected officials who have ensured their needs can be met.”

When contacted by Vertical, a Leonardo Helicopters spokesperson said that the company did not have comment on the matter at this time.

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