United States: A Road Less Traveled: Agency-Level Protests

An agency just messed up a procurement, and you want to protest. Where do you go? The vast majority of bid protests are filed with the Government Accountability Office (GAO). A far smaller percentage of protests are brought as lawsuits before the Court of Federal Claims. It is easy to forget there is a third forum available for most protests of federal procurements—the procuring agency itself, which may be preferable to the GAO and the court in certain circumstances.

Agency-level protests are governed by Federal Acquisition Regulation (FAR) 33.103 and agency FAR supplements. In a nutshell, they are written complaints addressed to the contracting officer or another designated official requesting corrective action of some sort. FAR 33.103(d)(4) allows protesters to request review of the protest at a level above the contracting officer, which the agency may allow either as an alternative to review by the contracting officer, or as an appeal from his or her decision. As at the GAO, a protest to the agency ordinarily is timely if filed before bid opening or the date set for receipt of proposals (for solicitation improprieties) or no later than 10 days after the protest ground was known or should have been known (for all other grounds). FAR 33.103(e). The GAO's debriefing exception—allowing protests to be filed later than 10 days after a ground is known if filed within 10 days after a required and requested debriefing—does not apply to agency-level protests. See M2 Global Tech., Ltd., B-400946, Jan. 8, 2009, 2009 CPD ¶ 13 at 3. And, as at the GAO, timely receipt of a pre-award protest ordinarily stays the contract award, and timely receipt of a protest within 10 days after a contract award or five days after a required and requested debriefing ordinarily stays performance of an awarded contract. FAR 33.103(f)(1), (3).

Beyond these very basic rules, agencies are generally free to proceed as they see fit in accordance with internal agency policy. In agency-level protests, protesters lack the right to inspect the procurement record or to rebut agency legal arguments through additional briefing. As a result, the protester cannot scour the non-public record for supplemental protest grounds. Rather than a judge or GAO attorney, the official adjudicating the protest is one of the procuring agency's own employees. The protester simply makes the best argument it can and the agency issues its decision, ideally within 35 days. If the protester disagrees with the outcome, it is free to seek higher-level agency review (if that is available), or to file a protest with the GAO (within 10 days of adverse agency action) or the Court of Federal Claims. Although agencies may voluntarily agree to continue a stay during a subsequent protest at the GAO or court (and some regularly do so as a matter of policy), pursuing an agency-level protest does not extend the time for obtaining an automatic stay of performance at the GAO. So, given the GAO's general "10 days after award" rule for obtaining a stay, the 35-day timeline for an agency-level protest generally means there will be no automatic stay at the GAO if a firm files its post-award protest at the agency first.

Given these apparent disadvantages, why would anyone protest to the agency rather than directly to the GAO or the court?

Advantage #1: Let's Not Air the Dirty Laundry

As a matter of customer relations, some companies may not want publicly to accuse a government customer of botching a procurement. It can be awkward hauling one's customer before a GAO attorney or judge or compelling it to produce voluminous internal agency documents for third-party review. Unlike at the GAO or the court, there is no public docket of agency-level protests and no participation by outside agencies or other branches of government. Everything is addressed quietly.

In our experience, most agencies are sophisticated enough to see bid protests as an ordinary and beneficial part of the federal procurement system and do not let protests sour their business relationships. All else being equal though, agencies likely prefer to address procurement errors internally rather than before third parties. So, when there is little doubt that a prejudicial error has occurred, and the offeror is fairly confident the agency will do the right thing and fix the problem, an agency-level protest may make sense. This is especially true if the agency assigns the protest decision to a level above that of the contracting officer, which may be beneficial if the contracting officer is part of the problem.

Advantage #2: Speed, Simplicity, and Lower Attorneys' Fees

Agency-level protests are generally faster, simpler, and cheaper than protests at the GAO, and almost always more so than at the Court of Federal Claims. Agencies strive to render a decision within 35 days (versus the GAO's 100-day deadline or the court's indefinite timeline), charge no filing fees, impose very few procedural hurdles, and usually require no briefing beyond the initial protest letter. In exchange for that streamlining, however, the protester gives up the procedural protections, document production, supplemental protests, and disinterested outside oversight that are part and parcel of protests in the other fora. For very cost-sensitive companies or low-value procurements, that tradeoff may be attractive.

Advantage #3: No Intervenors

Unlike protests at the GAO or the court, agency-level protests do not have intervenors. This means your competitors ordinarily will not have the opportunity to weigh in on the merits of your protest or to supply the agency with ammunition to shoot it down. Indeed, unless the agency has to stay performance of an awarded contract or ask offerors to hold open their offers, other offerors are often completely unaware that an agency-level protest has even been filed. This may be attractive to protesters interested in keeping a dispute one-on-one with the agency.

Advantage #4: Few Downsides for Pre-Award Controversies

As discussed above, the GAO has tight filing timelines for receiving an automatic stay of performance in a post-award protest. Because it is very unlikely that an agency will issue a protest decision within 10 days of a contract award, if a company files a post-award protest with the agency and loses, it almost always will be too late to get an automatic stay of performance in a timely second-bite protest before the GAO.

For pre-award protests of the terms of a solicitation or exclusion from the competitive range, however, an agency-level protest decision may be issued quickly enough for the offeror to file a subsequent pre-award protest at the GAO and still get a stay of contract award. If a future GAO stay is not jeopardized, and if the offeror is not terribly interested in inspecting procurement documents, there may be little downside to filing a pre-award protest initially with the agency itself, particularly if the procurement error is evident and easy to correct. If the agency does not correct the perceived error, the protester may find it fairly simple to convert the agency-level protest letter into a GAO protest and still get the stay of award for the duration of the GAO protest period. Moreover, agencies may provide for voluntary stays to encourage protestors to come to them before the GAO; in those circumstances, even post-award agency-level protests may have few downsides.

Caveats

On the flip-side, agency-level protests pose unique dangers. The trickiest part is their effect on GAO timelines if a protester wants to go to the GAO following an unsatisfactory result before an agency. Given the Court of Federal Claims' more flexible timeliness rules, most of these caveats apply only to subsequent GAO protests and may have little or no effect on a protest before the court.

The first trap for the unwary is that a pending agency-level protest does not stop or extend the GAO's clock for a stay of contract performance. So, unless the agency agrees to a voluntary stay (which some do as a matter of course), a post-award agency-level protest may result in a forfeited stay of performance if the protester goes to the GAO at a later time.

Second, and perhaps more problematic, prior agency-level protests alter the rules for timeliness to bring a GAO protest. See 4 C.F.R. § 21.2(a)(3). Before it will consider a protest, the GAO generally requires (1) challenges to the terms of a solicitation to be filed before the date set for receipt of proposals and (2) all other protests to be filed within 10 days of when the protest ground is known or should have been known. The GAO's "debriefing exception" usually allows post-award protests to be brought either 10 days after notice of contract award or 10 days after a required and requested debriefing, whichever is later.

When an agency-level protest has been filed, however, the normal rules do not apply. Rather, once an agency takes "adverse action" on an agency-level protest, the protester then has 10 days in which to file at the GAO. Sometimes this rule benefits the protester—for example, by allowing the GAO to hear a protest of the terms of a solicitation filed with the GAO after receipt of proposals, but within 10 days of the agency's adverse action. At other times, the rule disadvantages the protester—for example, by eliminating the "debriefing exception" for post-award protests or by forcing a solicitation challenge to be filed within 10 days of the adverse agency action, even though the time set for receipt of proposals may be weeks or months away. See, e.g., RTI Techs., LLC, B-401075, Apr. 15, 2009, 2009 CPD ¶ 86 at 3 (GAO protest was untimely when filed within 10 days after a required and requested debriefing, but more than 10 days after denial of agency-level protest). And if the underlying agency-level protest itself was untimely, a subsequent GAO protest will be time-barred, even if filed within 10 days of the adverse agency action. 4 C.F.R. § 21.2(a)(3).

The third caveat is it is not always clear when there has been an agency-level protest. This uncertainty poses great risks given the effect of a prior agency-level protest on GAO protest timelines, and it is entirely possible for an offeror to trigger a protest clock "accidentally" without realizing it. The GAO has long held that an agency-level protest is a (1) written communication to the agency, (2) specifically expressing dissatisfaction, and (3) requesting corrective action. See Coulson Aviation (USA), Inc., B-411525; B-411525.2, Aug. 14, 2015, 2015 CPD ¶ 272 at 5-6. A writing may be a protest even if it is not expressly labeled as such. See Mackay Commc'ns—Recon., B-238926.2, Apr. 25, 1990, 90-1 CPD ¶ 426 at 1. A request for agency action without a corresponding expression of dissatisfaction, however, is not a protest. Fed. Marketing Office—Recon., B-249097.3, Jan. 5, 1993, 93-1 CPD ¶ 4 at 3-4. And an expression of dissatisfaction coupled with a mere suggestion, request for clarification, or an expressed hope or expectation of certain agency action is not an agency-level protest. Masai Techs. Corp., B-400106, May 27, 2008, 2008 CPD ¶ 100 at 3. But it is not always clear what the GAO will deem to be an expression of dissatisfaction or a request for corrective action. In one remarkable case, the GAO found an agency-level protest was filed when a bidder faxed a handwritten note to the agency on the day of bid opening, stating that the specifications seemed to be written around another vendor's product (deemed to be an expression of dissatisfaction) and asking the agency to "[p]lease advise me" (deemed to be a request for corrective action). Am. Material Handling, Inc., B-250963, Mar. 1, 1993, 93-1 CPD ¶ 183 at 2-3.

"Adverse action" is similarly fuzzy: It may be a written protest denial or simply some action or oral statement inconsistent with what the protester requested. In the American Material case, for example, the adverse action was the agency opening the bids after receipt of the protester's fax, thus giving the protester 10 days in which to file its pre-award protest with the GAO. In W.D. McCullough Constr. Co. & M&A Equipment and Constructors Inc., a Joint Venture—Recon., B-238460.2, Mar. 5, 1990, 90-1 CPD ¶ 252, the GAO found the adverse action to be a meeting with the contracting officer, during which the contracting officer orally informed an offeror with a pending agency-level protest that he "was abiding by his initial decision." Because the protester did not make it to the GAO within 10 days of that conversation, the GAO found its subsequent GAO protest to be untimely.

So, if an offeror sends the contracting officer a two-sentence email opining that a solicitation specification was not ideal and asking for it to be changed, an agency-level protest may just have been filed. If the contracting officer writes back, "Thanks, but I don't plan to change it," the offeror has 10 days to file a GAO protest or may be found to have waived its ability to raise that ground before the GAO—even if neither the offeror nor the contracting officer considered the email exchange to be a protest and adverse agency action, and even if initial proposals are not due for weeks. Thus, offerors should be careful about how they complain to agencies.

A final caveat is that it is unclear whether agencies have "jurisdiction" over protests of task or delivery orders. It is clear that some agencies take the position that only the GAO may consider such protests, unless the protest involves an increase in the scope, period, or maximum value of the contract under which the order is placed. See, e.g., Logis-Tech, Inc., B-407687, Jan. 24, 2013, 2013 CPD ¶ 41 at 4 (noting that the Marine Corps dismissed an agency-level task-order protest for lack of jurisdiction and holding that agency-level denials and dismissals are treated the same for purposes of timeliness before the GAO). It is also clear that some agencies have considered protests of task and delivery orders on the merits—including protests that the GAO itself cannot hear. See, e.g., Kevcon, Inc., B-406418, Mar. 7, 2012, 2012 CPD ¶ 108 at 2 (noting that the Department of Veterans Affairs issued a decision on the merits in a protest of a task order valued at under $10 million). Because agencies do not publish their own protest decisions, it is difficult to say what the majority approach is. At the end of the day, questions of "jurisdiction" are largely academic if an agency agrees with the protester on the merits, given the agency's discretion sua sponte to correct perceived procurement errors. If an agency does not want to act on a protest, however, it can dismiss the protest outright—with the same result as if it had denied the protest on the merits. The protester then must figure out whether the GAO has statutory jurisdiction over the protest, or whether a complaint to the agency's task and delivery order ombudsman may be its only remaining recourse. See FAR 16.505(b)(8).

In short, agency-level protests are an often-overlooked avenue for addressing procurement errors but are not without drawbacks and risks. Savvy government contracts counsel can help companies decide if an agency-level protest may be right for them.

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

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Morrison & Foerster LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Morrison & Foerster LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions