United States: Bid Protest Remedies (Post-Award Protest Primer #4)

Last Updated: August 7 2017
Article by Daniel E. Chudd and James A. Tucker

We've discussed debriefings and the timelines and timeliness rules that apply to post-award protests. Today we'll discuss remedies. If you file a protest to challenge a contract award and you win the protest, that means you win the contract, right? Well, certainly not immediately. And, depending on the facts, maybe not at all.

A protester wins a protest when the procuring agency voluntarily takes corrective action or the GAO issues a decision recommending that the agency take corrective action. Although protesters often request a "directed award," we are not aware of the GAO ever granting that remedy. Instead, the GAO will recommend that the agency take certain steps to correct the errors identified by the GAO. Thus, the nature of the errors largely will determine the character of the remedies available. The GAO's bid protest regulations set out six general remedies that are available, applicable to pre-award and post-award protests:

  1. Refrain from exercising options under the contract;
  2. Terminate the contract;
  3. Recompete the contract;
  4. Issue a new solicitation;
  5. Award a contract consistent with statute and regulation; or
  6. Such other recommendation(s) as GAO determines necessary to promote compliance.

4 C.F.R. § 21.8(a). Practically speaking, one can divide the post-award errors and related remedies into the three broad categories described below, which cover nearly all sustained post-award protests at the GAO.

Evaluation and best value analysis errors: These errors are often the most easily corrected, and generally result in the simplest remedy: re-evaluation of the existing proposals in accordance with the solicitation and issuance of a new award decision. The new award decision or may not result in a different awardee. If the GAO sustains a protest simply because the record does not adequately document the basis of the evaluation or best value trade-off, the corrective action may involve no more than the agency doing a better job of explaining in writing why it reached its original conclusions. If the evaluation error involves an offeror's eligibility for award – for example, where an Organizational Conflict of Interest may exist or a proposal may otherwise be unawardable – the corrective action may result in exclusion of an offeror from the competition altogether, or inclusion of an offeror that was erroneously excluded.

Solicitation errors: Sometimes a protest reveals that the solicitation does not say what the agency meant it to say. Although solicitation challenges generally are untimely if raised after the date set for submitting proposals, when an error is not apparent on the face of the solicitation (i.e., it is a latent defect) a challenge may be raised within 10 days of whenever the error comes to light. Solicitation errors may include latent ambiguities that prevent offerors from competing on an equal basis, misstated requirements, negligently prepared estimates, and the like. In these cases, the GAO generally will recommend that the agency amend the solicitation and solicit revised proposals. The agency generally has the discretion to allow offerors to revise any aspect of their proposals, or to limit the revisions to those areas implicated by the amendment. The agency then evaluates the revised proposals and issues a new award decision, which again may or may not result in a different awardee. On fairly rare occasions, a solicitation is so flawed that the remedy is for the agency to cancel it altogether, perhaps followed by issuance of a "new and improved" solicitation.

Discussion errors: When an agency chooses to open discussions with offerors, it must at a minimum raise with each offeror in the competitive range all deficiencies, significant weaknesses, and adverse past performance information to which the offeror has not yet had the opportunity to respond. These discussions must be meaningful and not misleading. Discussion errors generally result in a GAO recommendation to reopen discussions, with the opportunity for all offerors in the competitive range to submit revised proposals, which the agency then must evaluate. As noted above, in the context of corrective action, agencies have the discretion to impose reasonable limits on the scope of proposal revisions.

So, depending on the errors identified in the procurement, the remedies recommended by the GAO or voluntarily undertaken by the agency may involve any combination of the above. Implementing the remedies may take time and, when the corrective action is complete, there is no guarantee that the protester will end up with the contract.

On rare occasions, no meaningful remedy may be available despite the identification of prejudicial errors. This usually occurs when a contract has been substantially completed by the time the protest is adjudicated or otherwise cannot be awarded to the protester. In those instances, the GAO will recommend reimbursement of the successful protester's bid preparation costs in lieu of the ordinary remedies. Similarly, when performance has advanced significantly, but not completely, the GAO may allow the awardee to complete the base year to avoid disruption, but recommend that the agency refrain from exercising options and recompete those requirements instead.

Agencies generally have significant discretion in tailoring their corrective action to meet the GAO's recommendations, or to address the errors the agency perceives in the case of voluntary corrective action. That discretion is not unbounded, however, and the announced corrective action itself can be protested. But that is a post for another day.

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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