United States: August 2016 Protest Roundup

Last Updated: September 9 2016
Article by Ethan E. Marsh and James A. Tucker

We're rolling out a new monthly feature on our Government Contracts Insights blog, presenting a handful of interesting bid protests from the preceding month. Rather than exhaustively analyzing each decision, we will highlight a few protest grounds that we think are noteworthy or just good reminders for companies competing for contracts and agencies conducting procurements.

National Air Cargo Group, Inc. v. United States (Fed. Cl. Aug. 26, 2016)

As previously discussed in this blog earlier this year, the Court of Federal Claims refused to dismiss a protest where the protester was itself one of multiple awardees and objected to corrective action that resulted in award to a sixth firm. The court's approach was interesting because it stood in stark contrast to the traditional position of the Government Accountability Office (GAO), which customarily finds that awardees lack the direct economic interest necessary for standing to protest.

After letting the protester make its case, the court has now denied the protest on the merits, finding that the agency did not terminate its power to accept an offer by initially sending an "Unsuccessful Offeror" letter to the protested awardee, that awarding six contracts did not violate the solicitation's provision for "approximately four" awards, and that the best value tradeoff was not flawed, even though the protested awardee's past performance rating did not change as a result of the corrective action.

The last holding is a useful reminder of the "considerable deference" the court and the GAO give agencies in determining best value. Although the protested awardee's underlying rating did not change from the first evaluation (when it did not receive an award) to the corrective-action evaluation (which resulted in an award), the agency's second source selection decision added analysis and documented the agency's consideration of factors that led the court to "discern[] no irrationality" in the award decision. In other words, the same underlying evaluation may support different award decisions, as long as the agency documents a reasonable tradeoff analysis in accordance with the solicitation's evaluation scheme. If the agency does that, neither the court nor the GAO will substitute its judgment for that of the agency.

Tetra Tech AMT v. United States (Fed. Cl. Aug. 29, 2016)

This protest centered on whether the page limits imposed by a Request for Quotes (RFQ) applied only to initial quotes, or also to revised quotes submitted in response to a request for quote revisions. The protester's revised quote exceeded the RFQ page limits, and the agency disregarded the excess pages, leading to an adverse evaluation. The protester argued that the RFQ and request for revisions were ambiguous regarding whether the page limits continued to apply to revised quotes, and the protester reasonably assumed they did not. The court disagreed, finding that the RFQ clearly established a page limit that the request for revised quotes did not change, and that the protester's contrary interpretation was unreasonable. Although the court's resolution did not require it to decide whether the alleged ambiguity was latent or patent, it noted that, to the extent any ambiguity regarding the page limits was patent, Federal Circuit precedent required the protester to raise the ambiguity with the agency before the time set for submission of revised quotes or the protest ground would be waived.

The moral of the story is that bidders should not assume a solicitation means one thing when there is a readily apparent possibility it may mean something else. Although latent ambiguities (i.e., ones a reasonable reader would not notice) will be construed against the government as the solicitation's drafter, a bidder that fails to challenge a patent ambiguity (i.e., one a reasonable person should notice) before the date set for receipt of proposals waives the right to protest it later. If you are not sure what a solicitation provision means, ask the agency before you submit your proposal.

GGear, B-413216, Aug. 15, 2016

GGear involved an agency's rejection of a late proposal. The solicitation instructed offerors delivering proposals by hand to submit their proposals to the agency's Business Opportunities Office by 3:00 p.m. The protester alleged that its courier arrived at the agency 45 minutes before the deadline, but was denied entry at three different security checkpoints when the guards were unable to contact the contracting officer or contract specialist (who did not work at the Business Opportunities Office) by phone. The agency, however, showed that the designated office was open and had escorts available for couriers, that no voicemails were received from the protester prior to 3:00 p.m., and that the protester did not send its first email requesting assistance until 3:27 p.m.—after the deadline had passed. The agency also showed that other offerors successfully hand-delivered proposals that day and blamed the protester for instructing its courier to seek out the contracting officer, rather than to go to the Business Opportunities Office as instructed. The GAO denied the protest, holding that the agency properly rejected the proposal, which was late through no fault of the government.

The takeaway here is that offerors should follow solicitation instructions to the letter and should not wait until the last minute to submit their proposals. And, after the proposal is submitted, an offeror would be wise to seek a confirmation of receipt well before the deadline has passed.

Arcadis U.S., Inc., B-412828, June 16, 2016

In this fixed-price procurement, the agency based its award decision in part on a determination that weaknesses in the protester's technical approach were likely to pose a cost risk. The protester argued that, because the fixed-price nature of the task order shifted cost risk onto the contractor, the agency's concerns about cost implications were unreasonable. The GAO agreed with the protest and also found that the procurement record did not demonstrate that the agency performed an adequate best-value tradeoff of the protester's low price against the higher priced offeror's higher evaluated technical merit.

This decision highlights the importance of contract type to the way agencies treat cost-related issues in a proposal. It is also a useful reminder that, despite the great deference shown to agencies' best-value decisions, the GAO will not uphold a decision that is inadequately documented or based upon an underlying evaluation that is unreasonable.

Rotech Healthcare, Inc., B-413024 et al., Aug. 17, 2016

Agencies use an offeror's past performance to determine the degree of confidence they can have in that offeror's ability to successfully complete a similar contract in the future. In Rotech, the GAO found the agency unreasonable and gave the awardee a Good rating for past performance based on its performance of contracts that the agency failed to analyze for similarity in size to the work being solicited. Although the GAO generally considers past performance evaluations to be a matter within an agency's discretion, here there was no record that the agency considered the size and scope of the reference contracts at all, and the GAO accordingly sustained the protest on this ground.

The GAO also found that, months after discussions had closed, the agency invited the awardee to confirm or update its pricing, but did not afford the protester the same opportunity. Although the awardee did not revise its pricing, the protester successfully argued that because seven months had passed since final proposals had been submitted, it would have been able to submit a lower price if it had been given the same opportunity as the awardee. The GAO considered the invitation to revise pricing to be disparate treatment, tantamount to a reopening of discussions with a single offeror, and sustained the protest on this ground as well.

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morrison & Foerster LLP. All rights reserved

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