A federal judge Monday granted a preliminary injunction sought by environmental engineering and consulting firm Gandee and Associates, which alleged a series of procurement policy violations, conflicts of interest and “grossly inflated” contracts awarded by the V.I. Housing Finance Authority.

The firm filed its civil complaint against the VIHFA and two of the agency’s top executives in June, claiming that VIHFA arbitrarily rescinded seven contract awards after Gandee pointed out differences between the scope of work described in contract documents and the agency’s request for qualifications. Molloy wrote in a blistering opinion filed this week that when Gandee attempted to communicate the discrepancies to VIHFA, “the message rang flat.”

“It was distorted, disputed, ignored, and refuted, as it traveled up the ranks and across procurement, contracting, and legal departments at VIHFA — finally culminating in the instant federal lawsuit that could easily have been averted had VIHFA simply adhered to its own published policies and procedures,” he wrote. “Instead, VIHFA appears to have doubled down in a brazen display of disregard for its duty to the public.”

Gandee responded to two requests for qualification VIHFA issued in 2024 but was not invited to bid on the first batch of contracts. According to court documents, at least five of those were awarded to Tysam Tech. Gandee alleged that a conflict of interest existed because VIHFA’s former senior environmental manager, Kyora Veira, began working for the rival bidder three days after leaving the agency in May 2024. Molloy acknowledged the evidence Gandee presented but wrote that the point was moot because nearly all of the work under that RFQ had been completed.

After responding to a second RFQ in 2024, Gandee bid on eight more environmental assessment projects and was awarded seven. Those were later rescinded when the firm noted irregularities in the scope of work described in the contracts. Despite attempts to protest the agency’s rescissions, “G&A was never afforded a hearing, much less a rational conversation, before or after VIHFA rescinded its contracts,” Molloy noted.

“Unfortunately, and somewhat incredulously, VIHFA flatly refused to correct the contracts. The Court finds this extremely baffling,” Molloy wrote, adding that agency employees called to testify in August quickly acknowledged the discrepancies. “It is unclear why VIHFA curtly dismissed G&A’s concerns with this glaring inconsistency and did not afford it the attention it deserved.”

Molloy found that termination provisions outlined in the contract “significantly constrained” the agency’s discretion to rescind them except in cases of contractor default, insufficient federal funding or noncompliance with federal guidelines.

“Not one of the awarded contracts permitted termination simply for VIHFA’s convenience and VIHFA did not offer justifiable cause for rescinding any of G&A’s awards,” he wrote.

At least one of the contracts VIHFA clawed back was awarded to Tysam Tech, whose bid came in nearly 500% higher than Gandee’s. According to a letter of non-award the Ohio company received, Gandee was not selected for the eighth project because it was “not the lowest responsive bidder.” That project, for work at Sejah Farm, was awarded to Tysam Tech for $35,255. Gandee bid $11,000. Molloy wrote that there “is reason to believe that public funds may be saved by a reevaluation of the awards” and that in “more than one instance, VIHFA failed to adhere to its own rules.”

Molloy wrote that “the record strongly suggests a violation of duty has occurred, and it unfolded like the ‘Emperor’s New Clothes’ — the bare truth was laid out but no one at VIHFA spoke up.”