United States: September 2017 Bid Protest Roundup

Last Updated: October 12 2017
Article by Locke Bell

This roundup of notable bid protest decisions issued in September 2017 highlights three decisions, two at the Government Accountability Office (GAO) and one at the Court of Federal Claims (COFC).  The first reminds us of the broadness of the discretion afforded a source selection official making a best-value tradeoff decision.  The second explores the line between products and services reasonably included in an offeror's General Services Administration (GSA) Federal Supply Schedule (FSS) contract, and those that must be separately provided.  And the last examines standing to continue a protest at COFC when intervening circumstances leave a disappointed offeror otherwise ineligible for award.

SSI Tech., Inc., B-414204.3, Sept. 12, 2017, 2017 WL 4021818

The bounds of a source selection official's discretion, although universally broad, may be set differently based on the reviewing GAO attorney and the facts of the case at hand.  In SSI Technology, GAO found it was within the source selection official's rational discretion to award a contract for liquid fuel water separators to a dealer at a unit price of $104 more and a delivery date 170 days later than a manufacturer of effectively equivalent liquid fuel water separators, based on concerns about the manufacturer's past performance.  The source selection official concluded reasonably, in GAO's opinion, that the dealer offered the best value to the government.

The protester pointed out that the solicitation at issue did not mention "best value" or provide for a "best-value tradeoff" by the agency.  In this regard, the solicitation provided, "If the requirement is evaluated manually" — which it was, according to the contracting officer — "price, delivery, and past performance will be considered in accordance with the terms in the solicitation.  Since delivery is an evaluation factor, there may be an evaluation preference for quotes/offers of fewer delivery days than the number of delivery days requested by the Government."  GAO held that this language "effectively required a best-value analysis by providing that award would be based on 'price, delivery, and past performance.'"

The protest further challenged the agency's best-value tradeoff decision as unreasonable and without a rational basis in light of the fact the awardee offered a price 34 percent higher than the protester for what the protester considered to be the exact same product, at a substantially later delivery date.  GAO found this appeal to price and delivery unpersuasive in the face of the agency's determination that the protester's "very poor past performance history, which included a [Past Performance Information Retrieval System] score of 0 and indicated in part that, in the past year, it had delivered only 23.8% of its DLA-awarded [Contract Line Item Numbers] by their due dates" resulted in concern that the protester's proposal did not "represent a time frame in which [the protester] can actually perform."  The agency was reasonable, then, to determine it was worth paying a $104 premium per unit for a "high degree of timely performance."

GAO's decision in SSI Technology serves as a reminder of the formidable climb facing a disappointed offeror as it sets out to overturn an agency's best-value determination as unreasonable.

Bluewater Mgmt. Grp., LLC, B-414785, Sept. 18, 2017, 2017 WL 4174397

GSA FSS contracts provide major administrative ease to procuring agencies, but they present some pitfalls that should be kept in mind.  One is in Bluewater Management, where GAO sustained a protest challenging an award for mixed services, some of which were not included in the awardee's schedule contract.

Specifically at issue were lodging and transportation services for civil service mariners assigned to the Military Sealift Command at Norfolk Naval Base.  The Navy required up to 250 extended-stay hotel rooms within 25 miles of the base, along with daily round trip transportation at prescribed times.  In its request for quotations (RFQ), the Navy listed the lodging and transportation requirements as separate contract line item numbers (CLINs) to be provided and invoiced under the resulting contract.

The Navy invited vendors holding GSA Schedule 48 contracts including Special Item Number 653-9, Long Term Lodging, to submit quotations, although the RFQ made no reference to the schedule or special item number (SIN).  Schedule 48 covers services relating to transportation, delivery, and relocation services.  It includes many SINs, such as SIN 653-9 for corporate housing facilities and SIN 411-1 for passenger ground transportation services.  These individual SINs may cover complementary services as well; SIN 653-9 anticipates that vendors may offer a wide range of amenities to complement the long-term lodging provided, including transportation services.

The awardee in Bluewater Management held a single FSS schedule 48 contract, with SIN 653-9 as its only SIN, listing prices for three types of lodging and identifying only housekeeping services as an additional service, with applicable pricing.  The protester argued that the transportation services required by the RFQ were outside the scope of the awardee's Schedule 48 contract, and therefore the agency was precluded from purchasing those services through it.  The Navy rebutted that because the standing statement of work for SIN 653-9 contemplated transportation services, the agency could purchase the services as "other direct costs" (ODCs).

The GSA Ordering Guidelines state that "[t]o the extent possible, all anticipated ODCs associated with performance and within the scope of the GSA Schedule contract should be offered as separately listed items, and have an established contract price."  GAO, conspicuously disregarding the qualifier "to the extent possible," held that the transportation services awardee proposed were required to be listed on the awardee's schedule with an established contract price.  GAO held that the RFQ required ground transportation as a distinct service to perform the task order, not merely to support the provision of lodging services, and therefore these services were not properly classified as ODCs — defined as "charges in direct support of a service," according to the GSA Ordering Guidelines.

Because the awardee's Schedule 48 contract did not include a SIN for transportation services or otherwise list pricing for transportation services, GAO concluded the Navy's acceptance of the awardee's quotation was improper.  GAO's decision in Bluewater Management reminds agencies and offerors alike to ensure proposals based on GSA Schedule contracts cover all items and services called for in a solicitation.

Geiler/Schrudde & Zimmerman v. United States, No. 16-186C, slip op. (Fed. Cl. Aug. 30, 2017)

We round out this month's bid protest roundup with a case that presents an interesting (albeit sad) fact pattern.  Both COFC and GAO will review a protester's status as an "interested party" as a jurisdictional threshold for hearing a protest — GAO in accordance with its authorizing statutes at 31 U.S.C. §§ 3551, 3553 and its bid protest regulations at 4 C.F.R. §§ 21.0 and 21.1, and COFC in accordance with the Tucker Act, 28 U.S.C. § 1491(b).  At both, with some variations, a party generally is an interested party for the purposes of a post-award protest if it was an actual bidder or offeror and had a direct economic interest in the procurement, meaning it had a substantial chance of receiving award.  But does a protester retain its standing as an interested party if it had a substantial chance of receiving award when it submitted its protest, but due to intervening circumstances is precluded from award on remand to the agency?

In Geiler/Schrudde & Zimmerman, the court confirmed yes, the protester maintains its standing to protest.  There, challenged procurement was set aside for award only to a service-disabled veteran-owned small business (SDVOSB).  When the protester submitted its initial complaint in February 2016 challenging alleged errors in the Department of Veterans Affairs' evaluation of proposals to build a chiller plant at a VA facility in Lexington, Kentucky, the protester qualified as an SDVOSB.  But just over a month after the complaint was filed, plaintiff's service-disabled veteran owner died.

The VA subsequently revoked the protester's certification as an SDVOSB, and the Government moved to dismiss the protest, arguing that the protester was no longer an interested party because it no longer had a substantial chance at award or an economic interest in the procurement.  The court denied the motion, holding, "Standing is determined at the time of the award."  Slip op. at 6 (emphasis added).  Because the protester was an SDVOSB when the initial award decision was made — on September 23, 2015 — the fact that the owner died after the complaint was filed on February 8, 2016 (following an initial protest at GAO) was irrelevant in the court's analysis.  Accordingly, COFC retained its jurisdiction over the protest.

This did little good for the protester — the court then held in favor of the Government on the merits.  Nevertheless, this readily analogized fact pattern and clean holding by COFC provide an easy citation for protester counsel in the future.  One can foresee, without too much imagination, a scenario where a small-business protester challenges evaluation or procedural errors in a small business set-aside award (requiring certification of size as of the date of award), before being acquired or otherwise outgrowing the applicable size standard while the protest pends in court.  Under the holding in Geiler/Schrudde & Zimmerman, that protest could go forward regardless.

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
Locke Bell
 
In association with
Related Topics
 
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