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4 CFR 21.8:  Corrective Action Taken by Agency

Comptroller General - Key Excerpts

Deloitte argues that the agency’s updated FPR instructions continue to exclude proposal revisions “inextricably linked” to the key personnel substitutions permitted in response to discussions. Deloitte specifically asserts that the limitations, for example, improperly prohibit necessary revisions to its transition plan and unreasonably restrict the specific content of proposal updates in areas where revisions are permitted.

The agency responds that its limitations on the scope of FPR revisions are reasonable and tailored to remedy the identified procurement improprieties in our Office’s April 15, 2016 decision sustaining Deloitte’s prior protest in part, and are consistent with GAO precedent regarding agency discretion to limit proposal revisions in the context of corrective actions. The agency contends that Deloitte aims to update multiple aspects of its technical approach by using new key personnel to introduce new tools and techniques not presented in its prior proposal, and to alter its transition approach. According to the agency, Deloitte should not be “allowed to augment its technical approach at this late stage, thereby disregarding a reasonable corrective action tailored to correct a procurement impropriety.” Agency Report (AR) at 7.

An agency’s discretion when taking corrective action extends to the scope of proposal revisions. See, e.g., Computer Assocs. Int’l., B‑292077.2, Sept. 4, 2003, 2003 CPD ¶ 157 at 5; Rel‑Tek Sys. & Design, Inc.--Modification of Remedy, B‑280463.7, July 1, 1999, 99-2 CPD ¶ 1 at 3. As a general matter, offerors in response to discussions may revise any aspect of their proposals as they see fit, including portions of their proposals which were not subject to discussions; an agency, in conducting discussions to implement corrective action, may, however, reasonably limit the scope of revisions. System Planning Corp., B‑244697.4, June 15, 1992, 92-1 CPD ¶ 516 at 3-4. Where the corrective action does not also include amending the solicitation, we will not question an agency’s decision to restrict proposal revisions when taking corrective action so long as it is reasonable in nature and remedies the established or suspected procurement impropriety. See, Consolidated Eng’g Servs., Inc., B-293864.2, Oct. 25, 2004, 2004 CPD ¶ 214 at 3-4; Computer Assocs. Int’l, supra. In reviewing the reasonableness of an agency’s restrictions on proposal revisions in the context of discussions to implement corrective action, we will consider whether the discussions, and permitted revisions in response to discussions, are expected to have a material impact on other areas of the offeror’s proposal. Evergreen Helicopters of Alaska, Inc., B‑409327.3, Apr. 14, 2014, 2014 CPD ¶ 128 at 8; Honeywell Technology Solutions, Inc., B‑400771.6, Nov. 23, 2009, 2009 CPD ¶ 240 at 4; see also Rel-Tek Sys. & Design, Inc.‑‑Modification of Remedy, supra.; ST Aerospace Engines Pte. Ltd., B-275725.3 Oct. 17, 1997, 97-2 CPD ¶ 106 at 4.

We have reviewed the record here and, as a general matter, do not object to the agency’s decision to limit proposal revisions to areas in which our Office identified improprieties in the prior award decision. However, even where an agency is justified in restricting discussions responses in corrective action, the agency may not prohibit offerors from revising related areas of their proposals which are materially impacted. Whether these associated revisions may allow an offeror to further “augment its technical approach,”--as the agency asserts is Deloitte’s intention--is not the appropriate test of whether such revisions must be permitted. Rather, as set forth above, when assessing the reasonableness of an agency’s restrictions on proposal revisions, we consider the extent to which the discussions, and the permitted changes in response to discussions, materially impact or are “inextricably linked” with other aspects of an offeror’s proposal. Honeywell Technology Solutions, Inc., supra.

In multiple prior protests concerning agency decisions to limit the scope of proposal revisions as part of corrective action, our Office has concluded that the limitations imposed were reasonable. In each of these cases, we concluded that the permitted revisions in response to discussions would not impact other areas of the proposals in which revisions were prohibited. For instance, in Evergreen Helicopters, our Office did not object to corrective action that limited FPR revisions to the addition of “performance data charts for the aircraft type and tail numbers proposed,” and prohibited any other revisions. Evergreen Helicopters of Alaska, Inc., supra. at 3. We concluded that the limited revisions were reasonable to correct informational deficiencies in the proposals, that other aspects of the proposals such as pricing would not be impacted by discussions limited to additional performance data, and that correction of informational deficiencies with respect to previously-proposed aircraft, therefore, need not open the door for offerors to substitute entirely new aircraft.

Similarly, in Honeywell Technology Solutions, Inc., supra, our Office did not object to corrective action where the agency allowed offerors to revise their past performance proposals only. In that case, we found that the limited revisions were reasonable to correct evaluation errors associated with two prior past performance evaluations. Concerning the protester’s argument that the FPR limitations were unreasonably restrictive where other aspects of its proposal were “inextricably linked” to its past performance information, we disagreed, concluding that “Honeywell has failed to establish that NASA’s decision permitting offerors to update their past performance information is expected to have a material impact on their cost or technical proposals.” Id. at 3, 5.

Finally, in Rel-Tek Sys. & Design, Inc.‑‑Modification of Remedy, supra, we did not object to corrective action which limited proposal revisions to three specific solicitation requirements, concerning “acceptance, warranty and software performance provisions” of the solicitation. Id. at 2. In that protest, Rel-Tek argued that the corrective action was improper because it precluded Rel-Tek from changing areas of its proposal that the firm desired to change in order to be more competitive. Our Office concluded that the procurement improprieties and the corrective action involved separate aspects of the firm’s proposal and did not affect other portions of the proposal or requirements. We also specifically noted, however, that the limitations imposed by the agency did not prohibit the protester from revising other aspects of its proposal to the extent they related to the acceptance, warranty, and software performance provisions. Our decision indicated as follows:

To the extent Rel-Tek contends that the limited [best and final offer (BAFO)] request prejudices its chances for award, since the firm cannot alter its cost proposal in other areas that may have included costs related to these three [solicitation] requirements, we are not persuaded by this argument--Rel‑Tek has not shown that the terms of the BAFO request are unnecessarily restrictive. The agency’s BAFO request, limited to the offerors’ technical and cost-related proposal revisions for acceptance, warranty, and system performance, did not prohibit revision to other areas of the offerors’ proposals to the extent that those proposal areas contained terms and related costs for the three requirements at issue

Id., at 4 n.5 (emphasis added).

In contrast, in the present protest, we conclude that the corrective action, to include discussions regarding key personnel, does materially impact the protester’s technical proposal beyond the limited revisions permitted in the agency’s updated FPR instructions letter. On the record here, the protester has established that the permitted key personnel substitutions broadly impact its proposal due to the differing qualifications, capabilities, and experience of the key personnel substitutions, and their relative ability to perform the proposal as initially proposed. Where the agency’s limitations on proposal revision prohibit such changes, they are unreasonable.

For example, we agree with the protester that the FPR instructions, as written, unreasonably prohibit the protester from revising its transition plan, which is materially impacted by the permitted key personnel substitutions. Specifically, the FPR instructions permit revisions to proposal sections beyond those of subfactor 1B “only to the extent that your initial proposal referenced your key personnel.” Corrective Action Letter, August 12, 2016, at 1. While Deloitte’s transition plan, as proposed, did not directly address the transition of key personnel, Deloitte explains that its transition must nonetheless be revised because while its previously-proposed key personnel were all [DELETED] its substitute key personnel are [DELETED]. As a consequence, these new key personnel [DELETED]. Given that the agency’s proposal revision instructions preclude this change to a section of Deloitte’s proposal that would be materially impacted by the permitted key personnel substitutions, we conclude that the instruction’s limitations are unreasonably restrictive.

We also agree with the protester that the instruction limiting the contents of revisions to “updating the names of key personnel (as necessary) and updating any accompanying qualification descriptions for such new key personnel” unreasonably restricts the protester from conforming areas of its technical proposal that directly reference key personnel who will be removed. For example, Deloitte explains, and the record reflects, that its prior proposal identified two key personnel‑‑its program manager and senior information architect (architecture)--as also performing in non‑key roles as [DELETED] in its transition approach. Deloitte argues that these two individuals were selected based on prior experience [DELETED]. Both individuals are now to be replaced in Deloitte’s FPR. Because Deloitte’s new senior information architect (architecture) does not have experience [DELETED], Deloitte proposes to replace its [DELETED] with an individual who will not be designated as a key person--a substitution which would be prohibited under a plain reading of the agency’s limitations on revisions since the new individual is not one of the “key personnel.”

Finally, we agree with the protester that the agency’s decision to limit proposal updates to “accompanying qualification descriptions” is unreasonably restrictive with respect to other skills and attributes of the key personnel that Deloitte highlighted throughout its technical proposal. Specifically, Deloitte explains that because the substitute key personnel do not share the same skills and experience which led Deloitte to feature the prior key personnel in the other areas of its technical approach, those aspects of the approach also require revision. In essence, Deloitte maintains that the required substitutions necessitate changes to its technical proposal beyond merely changing the qualification descriptions of the new key personnel.

For example, Deloitte’s prior proposal presented multiple descriptions of its key personnel’s knowledge of various management practices and techniques, which were presented as enhancements to, and impact its approach to performance of, technical subfactors outside of subfactor 1B. Because Deloitte’s substitute key personnel have different skills and experience--with different [DELETED], for instance[6]--we agree that the permitted revisions should extend to revising references to substituted key personnel in Deloitte’s technical approach as necessary to reflect the skills of its new personnel, or to otherwise address the proposal content impacted by the removal of the prior key personnel.

In conclusion, we find that the restrictions on proposal revisions imposed by the agency in connection with key personnel substitutions, as part of the agency’s implementation of corrective action, are unreasonably restrictive. The protester has demonstrated that due to the inherently different qualifications, capabilities, and experience of key personnel, substitutions with respect to these individuals materially impact the protester’s proposal in a broad manner, in ways that need to be revised beyond merely substituting names and resumes for the individuals to be replaced.  (Deloitte Consulting, LLP B-412125.6: Nov 28, 2016)

AWS challenges the agency’s decision to issue a new solicitation for the shelving system. AWS contends that a different solicitation was unnecessary because, in its view, the requirements in the RFP are “the same in all material respects” to those solicited in the August RFQ. Protest at 2, 6. Therefore, AWS complains that it was improperly denied the contract for the supply and installation of the shelving system as solicited under the August RFQ. For the reasons discussed below, we conclude that the agency’s corrective action is unobjectionable.

Contracting officers have broad discretion to take corrective action where the agency determines that such action is necessary to ensure a fair and impartial competition. See Domain Name Alliance Registry, B-310803.2, Aug. 18, 2008, 2008 CPD ¶ 168 at 8. As a general matter, the details of corrective action taken in response to a protest are within the sound discretion and judgment of the contracting agency. KNAPP Logistics Automation, Inc.--Protest & Costs, B‑404887.2, B-404887.3, July 27, 2011, 2011 CPD ¶ 141 at 3. We generally will not object to the specific corrective action, so long as it is appropriate to remedy the concern that caused the agency to take corrective action. Networks Elec. Corp., B‑290666.3, Sept. 30, 2002, 2002 CPD ¶ 173 at 3. It is not necessary for an agency to conclude that a protest is certain to be sustained before it may take corrective action; rather, where the agency has reasonable concerns that there were errors in the procurement, we view it as within the agency’s discretion to take corrective action, even if the protest could be denied. See Bannum, Inc.--Protest and Recon., B-411074.2, B-411074.3, June 12, 2015, 2015 CPD ¶ 231 at 7.

In light of the broad discretion afforded to contracting agencies in taking corrective actions, we find reasonable the agency’s decision to cancel its RFQ and resolicit its requirements under a new solicitation. Here, the agency submits numerous examples of aspects of its original procurement that necessitated change or clarification. As an initial matter, the agency explains that it determined that it was in UNICOR’s best interest to act as the offeree (under a request for proposals) rather than the offeror (under a request for quotations) so that there would be no possibility for a rejection of the award. CO Statement at 3. Therefore, the agency decided to issue a new RFP rather than amend the August RFQ. See id.

Next, significantly, the contracting officer explains that the August RFQ did not clearly state how many awards were anticipated, which was a primary basis for AWS’s initial protest. See id. The new RFP, on the other hand, expressly contemplates up to two contracts, with one being for the shelving materials and the other being for the installation. See RFP at 2. In addition, the contracting officer notes that the August RFQ did not clearly explain either how quotations would be evaluated or the basis for award, whereas the RFP now lays out the evaluation factors and methodology. See id. at 29-31; CO Statement at 2.

The agency also significantly revised the proposal submission requirements. For instance, under the RFQ UNICOR had to rely on a vendor’s representation that its shelving materials were compatible with the shelving components to be provided by UNICOR. See RFQ at 1. The agency, however, explains that because it ultimately is responsible for the complete shelving system at the National Records Center, that it should be the entity making the determination as to whether a company’s materials are compatible. See CO Statement at 2. As a result, the solicitation now requires Package A offerors to submit samples of their “uprights,” which UNICOR will evaluate for “form, fit and function.” See RFP at 6‑7, 29. Similarly, Package A offerors also now have to submit design-layout drawings for evaluation, which allows UNICOR to assess whether the anticipated design will maximize space and allows UNICOR to compare offerors’ proposed designs. See id. at 6; CO Statement at 2.

Moreover, because UNICOR prefers that offerors plan the design of the shelving system, the RFP includes significant changes to the quantities of materials to be procured. In this respect, the RFQ had sought quotations for a specific amount and type of shelving based on the agency’s design. See RFQ at 7. The agency points out, though, that the specific shelving components needed for an offeror’s unique shelving layout will vary depending on the design. CO Statement at 2. The RFP, therefore, instructs offerors to propose only the materials required for the offeror’s specific design. See RFP at 5-6, 32.

The agency also references changes with respect to the installation of the shelving. Specifically, the August RFQ did not require that vendors submit any information regarding how they intended to install the shelving. See RFQ at 1-7. To better determine an offeror’s ability to meet project deadlines and to compare costs, the new RFP requires Package B offerors to submit an installation plan for evaluation. See CO Statement at 2; RFP at 8.

Thus, as highlighted above, the record does not support the protester’s assertion that the agency is “simply re-soliciting the same scope of work” and should have, instead, awarded one contract to AWS under the August RFQ. See Protest at 3. In this regard, while the solicitation still contemplates the purchase and installation of a shelving system, the substantial changes outlined above--changes to the evaluation and award methodology, proposal submission requirements, and quantity of materials being procured--support the agency’s decision to issue a new RFP for the procurement. Indeed, in a negotiated procurement such as this one, a contracting agency has broad discretion in deciding whether to cancel a solicitation, and need only establish a reasonable basis for doing so. Applied Resources, Inc., B‑400144.7, B-400144.8, July 31, 2009, 2009 CPD ¶ 161 at 2. A reasonable basis to cancel exists when, for example, an agency determines that a solicitation does not accurately reflect its needs, or where there is a material change in the services or supplies needed to satisfy the agency’s requirements; in such cases, cancellation of the solicitation and issuance of a revised solicitation is appropriate. See Logistics Solutions Group, Inc., B-294604.7, B-294604.8, July 28, 2005, 2005 CPD ¶ 141 at 3; see also North Shore Med. Labs, Inc.; Advanced BioMedical Labs., LLC, B‑311070, B-311070.2, Apr. 21, 2008, 2008 CPD ¶ 144 at 4 (finding cancellation of solicitation reasonable where solicitation included insufficient information to allow agency to properly assess offerors’ technical capabilities or ensure that quality control inspections could be met).

Given the agency’s well-reasoned rationale for the significant changes in the solicitation, we find unobjectionable the agency’s decision to cancel the RFQ and resolicit its requirements under a new solicitation. AWS has not shown that the agency’s actions are unreasonable or beyond the agency’s discretion.  (American Warehouse Systems, LLC B-412543: Mar 1, 2016)  (pdf)


 FCi contends that the agency was required to reevaluate proposals and make a new award decision, as well as make a new responsibility determination. FCi Comments at 2-3. The agency maintains that, in response to GAO's decision sustaining the prior protest, the agency was required only to reconsider whether USIS PSD was responsible, and not to reevaluate or make a new award decision. Supp AR at 10; AR at 7, 9. Consequently, the agency found PAE/USIS PSD responsible, based, in part, on PAE's financial resources that became available to the awardee in early 2015. AR at 12. In any case, according to the agency, "[t]he purchase of USIS PSD by PAE Shield had no impact on USIS PSD's technical proposal, or how it would perform the contract." AR at 3.

As set forth below, we find that, in the circumstances here, the agency was required to reevaluate proposals before proceeding with the contract. In this regard, the record shows that the sale materially and significantly altered the approach to contract performance as set forth in the originally submitted USIS PSD proposal, but the agency nevertheless generally confined its review to the effect on PAE/USIS PSD's responsibility, with only limited consideration of the effect on the awardee's past performance rating. In these circumstances, we find the agency's implementation of our recommendation to be unreasonable and sustain the protest on this basis.

Requirement to Reevaluate after Sale of USIS PSD

As an initial matter, we note that Federal Acquisition Regulation (FAR) § 9.103(b) provides that "[n]o purchase or award shall be made unless the contracting officer makes an affirmative determination of responsibility." It is axiomatic, therefore, that an affirmative determination of responsibility must occur before the award is made. As our Office has previously stated, responsibility is a contract formation term that refers to the ability of a prospective contractor to perform the contract for which it has submitted an offer; thus by law, a contracting officer must determine that an offeror is responsible before awarding it a contract. Advanced Tech. Sys., Inc., B‑296493.6, Oct. 6, 2006, 2006 CPD ¶ 151 at 5. The concept of responsibility expressly applies to "prospective contractors"--not "current" or "existing" contractors--a limitation that is repeated throughout the applicable statutes and regulations, and that indicates that the requirement for a responsibility determination applies before award of a contract. Advanced Tech. Sys., Inc., supra; see, e.g., 41 U.S.C. § 113 ("the term 'responsible source' means a prospective contractor"); FAR § 9.100 ("This subpart prescribes polices, standards, and procedures for determining whether prospective contractors . . . are responsible"); FAR § 9.102(a) ("This subpart applies to all proposed contracts with any prospective contractor . . . ."); FAR § 9.103(c) ("A prospective contractor must affirmatively demonstrate its responsibility . . . ."). Further, not only must a contracting officer make an affirmative determination of an offeror's responsibility "before making an award to that offeror," see, e.g., Latvian Connection, LLC, B‑410147, B-410149, Sept. 4, 2014, 2014 CPD ¶ 266 at 5; Asset Mgmt. Real Estate, LLC, et al., B-407214.5 et al., Jan. 24, 2014, 2014 CPD ¶ 57 at 14, the determination of responsibility should be made on the basis of information available as closely as practicable to contract award so that the determination is "as accurate and reliable as possible." Dutra/AmClyde Joint Venture, B-249364.2, Dec. 30, 1992, 92-2 CPD ¶ 453 at 7.

Here, having made a new responsibility determination, a determination that, as discussed above, must be made prior to award, the agency necessarily was required to either reaffirm the prior award or make a new award. Further, to the extent that the agency asserts that our prior decision only recommended making a new responsibility determination, we conclude that the agency could not reasonably ignore the impact on this procurement of the sale of USIS PSD to PAE.

Here, we find that as a result of the sale of USIS PSD to PAE, the original proposal, upon which the award decision was based, no longer reflects the intended approach to performance. In this regard, it is a fundamental principle of federal procurement law that an agency's evaluation of proposals must reflect a reasonable assessment of each offeror's ability to successfully perform the contract requirements, and that the evaluation and the agency's source selection decision must be adequately documented. FAR §§ 15.305(a), 15.308; Savvee Consulting, Inc., B‑408416, B‑408416.2, Sept. 18, 2013, 2013 CPD ¶ 231 at 7‑8. Where an offeror's proposal represents that it will perform the contract in a manner materially different from the offeror's actual intent, an award based on such a proposal cannot stand, since both the offeror's representations, and the agency's reliance on such, have an adverse impact on the integrity of the procurement process. Wyle Labs., Inc., B‑408112.2, Dec. 27, 2013, 2014 CPD ¶ 16 at 8; see Greenleaf Constr. Co., B‑293105.18, B‑293105.19, Jan. 17, 2006, 2006 CPD ¶ 19 at 8‑10; AdapTech Gen. Scientific, LLC, B‑293867, June 4, 2004, 2004 CPD ¶ 126 at 5; CBIS Fed. Inc., B‑245844.2, Mar. 27, 1992, 92‑1 CPD ¶ 308 at 5.

In Wyle Laboratories, Inc., supra, after the submission of proposals, but before award, the offeror's resources and approach to performing the requirements of the solicitation changed as a result of corporate restructuring, such that its proposal no longer reflected the manner in which the contract would be performed, the level of costs likely associated with performance, and the corporate entity that would perform the contract. As a result, we sustained the protest against the award, holding that the awardee's proposal, and the agency's evaluation thereof, was based on a technical approach, resources, and costs that were not accurately reflected in the proposal upon which the award was based. Wyle Labs., Inc., supra, at 8-11.

The circumstances here require a similar conclusion. Specifically, the record indicates that USIS PSD's proposal relied, in material respects, on the resources and support of its former parent, USIS LLC, and of Altegrity, USIS LLC's parent. In this regard, as set forth below, USIS PSD's proposal relied on USIS LLC and Altegrity for management capability, corporate resources, corporate experience, past performance, and financial resources.

Although the agency argues that USIS LLC's role in the performance of this contract would have been "relatively small," AR at 5, the record reflects otherwise. First, as our Office noted in our prior decision, USIS PSD's proposal stated that USIS PSD would not operate independently of USIS LLC when performing the contract. Specifically, USIS PSD's proposal stated:

USIS LLC operating divisions [such as USIS PSD] do not operate independently or even semi-independently from each other or from the parent company, the LLC. The whole of USIS LLC is managed by . . . our President. We have one integrated command and control structure. We share a set of common policies and procedures across the corporation . . . . Our employees also move across the organization among operating Divisions and the LLC.

FCi Federal, Inc., supra, at 8; see AR1, Tab 27, Folder 1, USIS Response to Questions, at 11.

The agency's contemporaneous evaluation records similarly reflected that the agency considered USIS LLC's role in performance of the contract to be important. For example, the agency's technical evaluation report noted that:

The Offeror states that all wholly owned subsidiaries of USIS LLC, the parent company, utilize certain corporate "back office" resources and support services, and the Offeror on this contract will be substantially supported by the same infrastructure

AR1, Tab 35, TEC Report, at 45 (noting that the agency planned to ask for greater detail regarding the support to be provided).

In addition, during the hearing conducted by our Office in connection with the prior protest, the contracting officer testified that the back office support to be provided by USIS LLC was "substantial, and that it would be provided throughout the life of the contract." Hearing Transcript (Tr.) at 19. In this regard, the contracting officer acknowledged that USIS LLC would provide "back office support," which the contracting officer interpreted to mean that USIS LLC would provide shared resources. Examples of the shared resources that USIS LLC would provide included human resources support, accounting services, and pricing support. Tr. at 18; see AR1, Tab 27, Folder 2, USIS Technical Proposal Changes, at 43. USIS LLC would also be relied upon to provide financial, legal, and security services. Id.[5]

USIS PSD's proposal also relied on the corporate experience[6] of USIS LLC, which the awardee's proposal described as "particularly relevant" to the offeror's ability to complete the solicitation's requirements. AR1, Tab 27, Folder 2, USIS Technical Proposal Changes, at 49. As set forth above, the RFP stated that offerors "shall address relevant corporate experience" in nine areas. RFP at 102. The awardee's proposal referenced USIS LLC's corporate experience in addressing seven of these nine areas. Specifically, the awardee's proposal relied on USIS LLC's corporate experience in addressing the areas of management of multiple sites and locations in a large geographically dispersed environment; management of a workforce of this magnitude; management of non-exempt employees covered by a wage determination or a collective bargaining agreement; customer service; transitioning a contract workforce of this magnitude; management of significant workload volume with lulls and significant surge events; and implementing a training program of this magnitude.[7] AR1, Tab 27, Folder 2, USIS Technical Proposal Changes, at 46-48.

In addition, USIS PSD's proposal contained numerous references to USIS LLC's corporate experience in performing an "OPM Field" contract, an "OPM Support Services" contract, and a National Reconnaissance Office (NRO) contract. With regard to the OPM Field contract, the awardee's proposal stressed the relevance of USIS LLC's corporate experience to the procurement in several areas. For example, with regard to managing a dispersed workforce, the proposal stated:

We currently leverage our financial and organizational resources to support a team of well over 3,000 individuals dedicated to the OPM program . . . . The relevance to FOSS of this corporate experience is that we have the management infrastructure in-place and business processes to manage a dispersed workforce in multiple locations, performing adjudicative work in support of national security goals.

AR1, Tab 27, Folder 2, USIS Technical Proposal Changes, at 49.

By way of another example, the awardee's proposal stated that USIS LLC's corporate experience on the OPM support contract "clearly demonstrates our ability to manage complex inter-related tasks of direct relevance to [the procurement here], where quality and accuracy are key to contract performance and to national security." AR1, Tab 27, Folder 2, USIS Technical Proposal Changes, at 51; see also id. at 4, 6, 8, 43, 46, 47, 48, 51, 52, 57, 59 (referencing USIS LLC's work on the OPM Field contract); id. at 12, 43, 44, 46, 50, 51, 53, 58 (referencing USIS LLC's work on the OPM support services contract); id. at 43, 46, 47, 48, 49, 50, 51, 52, 55, 56, 59 (referencing USIS LLC's work on the NRO contract).

Further, the awardee's proposal relied on the financial resources of USIS LLC and Altegrity to meet the RFP's requirements. Specifically, as set forth above, the RFP here required that offerors include, as part of their price proposals, "a narrative discussion of financial resources available sufficient to compensate the prime's staff for a minimum of the first two months of contract performance." RFP at 110. To satisfy this requirement USIS PSD's February 17, 2014 final proposal revision stated the following:

US Investigations Services, LLC is a wholly owned subsidiary of Altegrity, Inc. Operating divisions (wholly owned subsidiaries of US Investigations Services, LLC) include US Investigations Services Professional Services Division, Inc, hereafter referenced as USIS, the prime bidder on this contract, Labat-Anderson Incorporated (LABAT), and others. All financial statements are held at Altegrity Inc. . . .
 

* * * * *

Altegrity, Inc. possesses the financial resources and capability to support and satisfactorily perform the contract services as required under this RFP. . . . Altegrity, Inc. has demonstrated financial stability since inception, meeting all obligations including payroll, vendor payments, tax obligations and all other liabilities. Additionally, the company maintains lines of credit with several large financial institutions to ensure that any changes in our financial situation can be promptly addressed. These lines of credit and financial resources are available to operating divisions including US Investigations Services, PSD (USIS). . . . The combination of assets, cash flow and letters of credit are more than sufficient to cover costs for the initial sixty days of payroll plus all transition-in costs.

AR2, Tab 9, USIS PSD FPR 2, at 81-82.

Finally, we note that the past performance evaluation confirmed the substantial role USIS LLC was proposed to have in USIS PSD's performance. In our prior decision, we noted that the record clearly established that the agency accepted, for purposes of the past performance evaluation, USIS PSD's representation that USIS LLC would be substantially involved in performance of the contract. FCi Federal, Inc., supra, at 8. In this regard, the solicitation provided that the agency would consider the past performance of a parent only if an offeror showed that the parent would be "substantially involved" in performance of the field office support services effort." Id.; RFP at 102. Among USIS PSD's past performance references was a contract performed by its parent, USIS LLC, for investigative fieldwork for the National Reconnaissance Office. We noted that, in finding this reference relevant, the agency stated that "[f]or those references where USIS submitted past performance of their parent . . . they provided information regarding how they will be substantially involved in performance of the [field office support services] effort." FCi Federal, Inc., supra, at 8-9 (citing AR, Tab 44, Folder 5, BEC Consolidated Past Performance Report, at 21). Thus, it was clear from the contemporaneous record that the agency viewed USIS LLC as having substantial involvement in the performance of the contract here. FCi Federal, Inc., supra, at 9.

Overall, while the agency now attempts to characterize USIS LLC's role as "relatively small," AR at 5, USIS PSD's proposal itself and the agency's contemporaneous evaluation documents indicate that the role of the awardee's parents (USIS LLC and Altegrity) was considered by both the offeror and the agency to be substantial and important. Since USIS PSD represented that it would perform the contract by relying on its former parents' back office support, corporate resources, corporate experience, past performance, and financial resources, and since the sale of USIS PSD to PAE eliminated any relationship between USIS PSD and its former parents, such that PAE/USIS PSD's performance will be materially different from its proposal, the agency could not simply proceed in 2015 on the basis of USIS PSD's outdated 2014 proposal. Wyle Labs., Inc., supra; AIU North America, Inc., B-283743.2, Feb. 16, 2000, 2000 CPD ¶ 39.

In these circumstances, where the record indicates that the sale of USIS PSD materially and significantly altered the approach to contract performance as set forth in USIS PSD's proposal, it was unreasonable for the agency to generally confine its review to PAE/USIS PSD's responsibility, and we sustain the protest on this basis.

Past Performance

Finally, we note that although the agency contends that it did not reevaluate proposals, including past performance, the contracting officer's responsibility determination includes the statement that:

The information that I gathered in my reconsideration of PSD's responsibility did not lead me to change my Past Performance rating. Given the data gathered, it is my judgment that USIS PSD (now PAE PSI) is rated as low risk for Past Performance.

See AR2, Tab 10, Responsibility Determination, at 1 n.1. FCi contends that the agency's conclusion that PAE/USIS PSD's past performance merited a rating of low risk is unreasonable and unsupported in the record.

The agency argues that it did not engage in a reevaluation of past performance and that its consideration of past performance related only to the responsibility determination. The contemporaneous record, however, demonstrates otherwise, since the contracting officer's own words indicate that she considered not only the impact of the additional information on the awardee's responsibility, but also the impact on the awardee's "Past Performance rating." Id. In this regard, the agency stated that it researched the Past Performance Information Retrieval System reports and Contractor Performance Assessment Reports System reports for USIS PSD, USIS LLC, LABAT, and Altegrity; received information from other USCIS employees about the performance of PAE/USIS PSD and USIS LLC on other contracts with USCIS; and considered information regarding USIS LLC's performance on a contract for background investigations for OPM, including the corrective actions taken by USIS LLC and Altegrity in response to allegations of fraud in the performance of that contract. Supp. AR at 1-2; AR2, Tab 10, Responsibility Determination, at 5-7. As a result, the agency found that the awardee's rating under the past performance factor should not change from the originally assigned rating of low risk. AR2, Tab 10, Responsibility Determination, at 1 n.1.

This evaluation and the agency's conclusion regarding the awardee's past performance "rating" constituted a reevaluation (although limited) of PAE/USIS PSD's past performance, and not simply a consideration of past performance as it concerns the awardee's responsibility. In addition, given that USIS LLC and Altegrity will no longer have any role in the performance of the contract, we find that the agency's consideration of information relating to these companies in connection with the evaluation of past performance was unreasonable. Since PAE/USIS PSD's low risk rating was based upon a consideration of past performance of entities no longer involved in contract performance, we also find the agency's limited past performance reevaluation to be unreasonable.  (FCi Federal, Inc. B-408558.7, B-408558.8: Aug 5, 2015)  (pdf)


RAM contends that the Army failed to reasonably implement the corrective action proposed in response to the prior protest because the agency’s reevaluation did not meaningfully evaluate the feasibility of RAM’s proposed technical approach for TAR 9. The protester argues that “[t]he Contracting Officer has not reconvened the technical representatives of the supported Command (USA OTC) to evaluate the Feasibility of RAM’s approach.” Protest (Apr. 13, 2015) at 22. RAM alleges that the agency’s most recent evaluation findings regarding its proposal are materially similar to the previous evaluation findings, which in turn demonstrates that the agency did not reasonably reevaluate proposals.

The Army responds that the proposed corrective action did not commit the agency to reconvene the technical evaluation team; rather, the corrective action notice plainly stated that one alternative proposed resolution would be for the SSA to reevaluate appropriate proposal volumes and render a new source selection decision. See AR at 6. The agency argues that the SSA complied with the proposed corrective action by reevaluating proposals and rendering a new source selection decision. Id. (citing AR, Tab 26, Source Selection Decision (Mar. 23, 2015)).

We have recognized that the mere promise of corrective action, without reasonably prompt implementation, has the obvious effect of circumventing the goal of the bid protest system for the economical and expeditious resolution of bid protests. A1C Partners, LLC--Costs, B‑409189.3, Sept. 30, 2014, 2014 CPD ¶ 295 at 3. Thus, where an agency fails to implement the promised corrective action, or implements corrective action that fails to address a clearly meritorious issue raised in an initial protest, such that the protester is put to the expense of subsequently protesting the very same procurement deficiency, the agency’s action has precluded the timely, economical resolution of the protest. Id. Based on the record, we find no basis to conclude that the agency failed to implement the corrective action that it proposed in response to RAM’s previous protest.

As an initial matter, we find unpersuasive RAM’s suggestion that the Army’s corrective action was ineffective because it did not reconvene the technical evaluators to reevaluate RAM’s proposal. The agency represented that its corrective action, to which RAM did not object, would either be to amend the solicitation and invite revised proposals, or to have the SSA reevaluate appropriate volumes of proposals and render a new source selection decision. AR, Tab 26, Source Selection Decision (Mar. 23, 2015), at 1. The agency here determined that the latter approach was appropriate.

The record demonstrates that the SSA reevaluated proposals and rendered a new source selection decision. The agency has represented that the SSA reconsidered appropriate proposal volumes, and obtained updated OCI-related representations. See, e.g., Contracting Officer Statement of Facts (Apr. 20, 2015) at 4, 7; AR, Tab 8, Answers to RAM Debriefing Questions (undated), at 1-2. In addition, the Army has produced a revised Source Selection Decision, dated March 23, 2015, which reflects that the SSA reversed the prior source selection decision and awarded the contract to a different offeror. AR, Tab 26, Source Selection Decision (Mar. 23, 2015), at 10. Although the SSA’s conclusions regarding RAM’s proposal in the recent Source Selection Decision are materially similar to the evaluation findings regarding RAM’s proposal in the prior evaluation, we find that this fact, alone, does not demonstrate that the agency failed to reevaluate proposals and render a new source selection decision. On this record, we find no basis to sustain the protest.  (Research Analysis & Maintenance, Inc. B-410570.6, B-410570.7: Jul 22, 2015)  (pdf)


Next, Portage contends that the agency erred in assigning a weakness for Portage’s past performance of a contract to provide legacy management support services for DOE at the Paducah Gaseous Diffusion Plant. The weakness was assigned based on ratings of marginal in the areas of management of key personnel, schedule, cost control, and safety in Past Performance Information Retrieval System (PPIRS) reports for 2010 and 2011. AR, Tab E.1, SEB Report, at 95. According to the protester, the agency should not have considered its past performance at Paducah because the performance fell outside the three-year relevance window set forth in the RFP. In this regard, the RFP, initially issued on November 23, 2011, provided that offerors’ past performance would be evaluated “with respect to performance in service contracting under existing and prior contracts of a similar type, scope, and complexity completed or in progress during the past 3 years.” RFP at 98. Although offerors submitted their proposals, including past performance references, on February 12, 2012, Portage contends that its performance under the Paducah contract now falls outside the RFP’s 3-year window for considering past performance when measured from the agency’s reevaluation in the summer of 2014. Portage Protest at 11; Portage Comments at 15.

An agency’s evaluation of past performance, including its consideration of the relevance, scope, and significance of an offeror’s performance history, is a matter of discretion which we will not disturb unless the agency’s assessments are unreasonable or inconsistent with the solicitation criteria. Affolter Contracting Company, Inc., B-410878, B-410878.2, March 4, 2015, 2015 CPD ¶ 101 at 12; National Beef Packing Co., B‑296534, Sept. 1, 2005, 2005 CPD ¶ 168 at 4.

Here, Portage has not shown that the agency’s evaluation was unreasonable or inconsistent with the solicitation. Despite multiple rounds of protests and corrective action, the agency has not requested, and offerors have not provided, updated proposals. As a result, the agency’s evaluation considered as relevant contracts that had been completed or were in progress during the three years prior to the time initial proposals were due. See Portage AR at 14. In addition, the agency’s approach has the added benefit of providing a time certain that the offerors could anticipate when submitting their proposals. While Portage disagrees with the agency’s application of the 3-year relevance window, it has not shown that measuring the 3-year window from the time of proposal submission was an unreasonable implementation of the solicitation provisions.  (WAI-Stoller Services, LLC; Portage, Inc. B-408248.13, B-408248.14, B-408248.15, B-408248.16, B-408248.17, B-408248.18, B-408248.19, B-408248.20: May 29, 2015)  (pdf)


AXIS next argues that the corrective action favors Cherokee because it gives the firm the opportunity to revise its price proposal after both offerors’ initial prices were released. AXIS argues that since it was the lower-priced offeror, permitting Cherokee to adjust its price is prejudicial. Protest at 9. We find no basis to object to the agency’s proposed corrective action on this basis.

An agency need not equalize any competitive advantage afforded to competitors due to the release of price information when its release is not as a result of preferential treatment or any improper action on the part of the agency. See Nova Techs., B-403461.3, B-403461.4, Feb. 28, 2011, 2011 CPD ¶ 51 at 3. Further, we recognize that the possibility that the contract may not have been awarded based on a fair determination of the most advantageous proposal has a more harmful effect on the integrity of the competitive procurement system than does any disadvantage owing to the occurrence of a reopened competition after the release of price information. Jackson Contractor Group, Inc., B-402348.2, May 10, 2010, 2010 CPD ¶ 154 at 2. Here, we have no reason to question the need for the agency to receive additional price information from offerors, particularly in light of the use of sample task orders as part of the revised price evaluation.

AXIS also argues that, because Cherokee is currently performing the contract, the firm has the opportunity to provide an accurate price reflective of the agency’s current need. Protest at 9. In effect, AXIS argues that Cherokee, as the incumbent, has particular knowledge of the agency’s current and future needs, which will allow the firm to adjust its price proposal based on that knowledge.

It is well settled that an offeror may possess unique information, advantages, and capabilities due to its prior experience under a government contract, including performance as the incumbent contractor. Our Office has held that the government is not required to equalize competition to compensate for such an advantage, unless there is evidence of preferential treatment or other improper action. United Facility Servs. Corp. d/b/a EASTCO Building Servs., B-408749.2, Jan. 17, 2014, 2014 CPD ¶ 35 at 5 n.6. Here, AXIS professes its disadvantage based on nothing more than Cherokee’s status as an incumbent contractor, a situation that the agency need not compensate for in its evaluation. As a result, we deny this aspect of AXIS’ protest.  (AXIS Management Group, LLC, B-408575.2: May 9, 2014)  (pdf)


NGTS challenges the extent of the proposed corrective action. NGTS asserts that the corrective action is unduly limited, and that the agency instead should reopen discussions with all offerors followed by the opportunity to generally revise proposals.

Contracting officers in negotiated procurements have broad discretion to take corrective action where the agency determines that such action is necessary to ensure a fair and impartial competition. Domain Name Alliance Registry, B-310803.2, Aug. 18, 2008, 2008 CPD para. 168 at 8. As a general matter, the details of a corrective action are within the sound discretion and judgment of the contracting agency. Rockwell Elec. Commerce Corp., B‑286201.6, Aug. 30, 2001, 2001 CPD para. 162 at 4. In this regard, an agency's discretion when taking corrective action extends to a decision on the scope of proposal revisions, and there are circumstances where an agency may reasonably decide to limit the revisions offerors may make to their proposals. See, e.g., Honeywell Tech. Solutions, Inc., B‑400771.6, Nov. 23, 2009, 2009 CPD para. 240 at 4; Domain Name Alliance Registry, supra; Rel-Tek Sys. & Design, Inc.-Modification of Remedy, B‑280463.7, July 1, 1999, 99-2 CPD para. 1 at 3. We generally will not object to the specific corrective action, so long as it is appropriate to remedy the concern that caused the agency to take corrective action. Networks Elec. Corp., B‑290666.3, Sept. 30, 2002, 2002 CPD para. 173 at 3.

Here, the Army's intended corrective action focused not only on the very procurement deficiency (an unreasonable past performance evaluation) that led to GAO's ADR prediction that L‑3's protest would be sustained, but also on the concerns expressed by GAO regarding the adequacy of the evaluation of the performance of the EO/IR sensors as part of the offerors' proposed EMARSS systems. Since the agency's corrective action responded to the areas of concern identified by GAO, and nothing in NGTS's protest demonstrates that the agency's approach was an abuse of discretion, we deny NGTS's protest regarding the scope of the corrective action. Intermarkets Global, B-400660.10; B-400660.11, Feb. 2, 2011, 2011 CPD para. 30 at 3; cf., Lockheed Martin Sys. Integration‑‑Owego; Sikorsky Aircraft Co., B‑299145.5; B‑299145.6, Aug. 30, 2007, 2007 CPD para. 155 at 6 (change in evaluation methodology required opportunity to respond to revised scheme).

NGTS asserts that in reexamining the performance validations for the offerors' EMARSS systems, including considering information learned as a result of the protest process, it is likely that the agency essentially will conduct unequal discussions. We need not now resolve this dispute, since we view NGTS's assertion of unequal discussions as premature, given that an award decision has not yet been made. If NGTS is not selected for award, it may raise whatever evaluation errors it deems appropriate, including unequal discussions, at that time. See Intermarkets Global, supra, at 4-5; American K-9 Detection Servs., Inc., B-400464.6, May 5, 2009, 2009 CPD para. 107 at 5.  (Northrop Grumman Technical Services, Inc., B-404636.11, June 15, 2011)  (pdf)


Northrop requests that we recommend that the agency reinstate the task order previously issued to it. In the alternative, Northrop requests that we recommend that the agency tailor its corrective action and limit it to only that which is necessary to remedy any demonstrable errors in the earlier acquisition. In this regard, Northrop proposes various graduated levels of corrective action, including, for example, a limited reevaluation of the proposals, limited discussions with the offerors, or the issuance of a separate solicitation for some of the agency's requirements while leaving the remainder of the requirement under Northrop's previously issued task order.

As a general rule, agencies have broad discretion to take corrective action where the agency has determined that such action is necessary to ensure fair and impartial competition. Greentree Transp. Co., Inc., B-403556.2, Dec. 10, 2010, 2010 CPD para. 293 at 2. The details of implementing the corrective action are within the sound discretion and judgment of the contracting agency, and we will not object to any particular corrective action, so long as it is appropriate to remedy the concern that caused the agency to take corrective action. Partnership for Response and Recovery, B-298443.4, Dec. 18, 2006, 2007 CPD para. 3 at 3. Additionally, we have recognized that the possibility that a contract may not have been awarded based on a fair determination of the most advantageous proposal has a more harmful effect on the integrity of the competitive procurement system than does the possibility that the original awardee will be at a disadvantage in a reopened procurement because its price has been exposed. Id. at 4.

We have recognized a limited exception under which we will object to an agency's corrective action if the record establishes either that there was no impropriety in the original evaluation and award decision, or where there was an actual impropriety, but it was not prejudicial to any of the offerors. Security Consultants Group, Inc., B-293344.2, Mar. 19, 2004, 2004 CPD para. 53 at 2-3. In comparison, where, for example, an agency's proposed corrective action goes beyond what our Office originally may have recommended in connection with sustaining a protest, the agency's decision to pursue such a course of action does not, by itself, provide a basis for protest, absent some showing that the agency's actions are contrary to procurement law or regulation, or otherwise are improper. See C2C Solutions, Inc.; Trust Solutions, LLC, B-401106.6, B-401106.7, June 21, 2010, 2010 CPD para. 145 at 3; see also NavCom Defense Elec., Inc., B-276163.3, Oct. 31, 1997, 97-2 CPD para. 126 at 3.

On the record here, we have no basis to object to GSA's proposed corrective action. The agency explains that it determined from the results of the original competition that its requirements may not have been adequately defined. In this regard, after it issued the original TOR, the agency amended the solicitation to add a significant requirement for optional operations and maintenance (O&M) work to be performed outside of the St. Elizabeth's campus. Specifically, section B of the solicitation was amended to add optional CLINs 004B, 1004B and 2004B (each of these CLINS has several sub-CLINs representing annual requirements for each year of the multi-year periods of performance). While the CLINs included ceiling dollar value amounts (totaling $1,080,000,000), there was no further narrative description of the requirement in this section of the TOR. TOR, at B-4, B-6 and B-8.

Elsewhere in the TOR, there were two brief narrative references to the added services. First, the overview section of the statement of work provided, in relevant part, as follows: "Operations and Maintenance for DHS Headquarters personnel that do not move onto the campus are within the scope of this task order." TOR, at C-3. Second, the service desk section of the statement of work provided:

In addition, on an optional basis the Government may have the contractor support approximately 7,000 DHS HQ employees operating outside of the St. Elizabeth's campus in the National Capitol Region.

TOR, at C-11. The TOR included an additional reference to this added requirement; firms were instructed to submit a performance work statement that was structured around seven broad tasks, and task 4 included a reference to the optional O&M requirement. TOR, at C-15. Aside from these references to the optional O&M requirement, the TOR did not include any specific details concerning the nature of the services, the location where they would be performed, or any other details relating to the operating environments where the services were to be provided.

The lack of detail in this regard resulted in two bidder questions and answers, but the agency's answers did not provide any further specific elaboration concerning the agency's substantive requirements. The first question provided:

Q. The government in amendment 1 added the optional requirements of providing Operations and Maintenance (O&M) support to the residents of DHS that would not be moving to the St. Elizabeth's campus. By doing so they added an additional $1B[illion] in contract ceiling to the TOR. However the government didn't provide any information that would be needed to support those customers such as the locations and number of employees by facility. What their current O&M environments are; additional systems requirements analysis and design for those off campus; installation and testing requirements for those off campus.

A. Government will evaluate the proposed concept of how the O&M requirement will be handled. The ceiling (plug) number to bid to ($1B[illion]) is provided, so that won't affect pricing.

TOR, amend. 6, May 25, 2010, question No. 257. The second question related to how the offerors should bid what the agency described as the $1B ceiling value (and specifically was concerned with what would be required during performance should the ceiling amount be exceeded), but this second question provided no additional discussion concerning the substantive details of the agency's requirements, and again directed firms simply to "bid to the plug number." Id., question No. 261.

The record shows that the offerors diverged widely in their responses to the O&M requirement, and that the agency viewed the responses from three of the five competitors in this area as so deficient as to render their proposals technically unacceptable and, thus, ineligible for further evaluation or award consideration. Specifically, the agency had developed an independent government cost estimate (IGCE) for the O&M requirement which was based on an agency staffing estimate of 22,530,909 labor hours. Using the IGCE staffing estimate as a standard against which to evaluate the offerors' proposals, the agency found three of the proposals unacceptable for having offered inadequate staffing to perform the requirement. One of the three offerors proposed to perform the O&M requirement using [deleted] labor hours; a second offeror proposed [deleted] labor hours; and a third offeror proposed [deleted] labor hours. (In comparison, [deleted]; Northrop proposed [deleted] hours and the other firm proposed [deleted] hours. AR, exh. 5, at 63, 120.) The record shows that, once the agency found the proposals technically unacceptable for failing to offer adequate staffing, it discontinued its evaluation, and did not give consideration to the price proposals of the unacceptable offerors. AR, exh. 7, at 38.

Having found that four of the five competitors submitted technically unacceptable proposals, the agency made award on the basis of initial proposals to Northrop, notwithstanding the fact that its proposed price was [deleted] among the competitors (and exceeded the low price by more than $[deleted] million). In making its award decision, the agency did not perform a cost/technical tradeoff because it had eliminated the other offers from consideration. AR, exh. 7, at 38. The record also shows that, although these four proposals were found technically unacceptable for offering inadequate staffing, they otherwise received relatively high, closely ranked, scores under the evaluation criteria not related to adequacy of proposed staffing. AR, exh. 7, at 17.

We find the agency's decision to take corrective action in these circumstances reasonable. As noted, the proposed levels of effort for the O&M requirement varied significantly from one another, with a low proposed level of effort of [deleted] labor hours ([deleted] percent fewer hours than used for the IGCE); a second proposal of [deleted] labor hours ([deleted] percent fewer hours than used for the IGCE); and a third proposal of [deleted] labor hours ([deleted] percent fewer hours than used for the IGCE). Given the wide divergence in proposed levels of effort for the O&M requirement, as well as the relative lack of detail in the solicitation regarding this work, the agency reasonably concluded that it had failed adequately to convey its requirements to the offerors in a manner that would allow them to compete intelligently, and on a relatively equal basis.

Northrop suggests that it was the offerors' business judgment, rather than a lack of information relating to the agency's requirements, that led them to deviate so dramatically in their proposed staffing for the optional O&M requirement. Northrop maintains that, because the agency included in the solicitation a $1 billion "plug" price for purposes of preparing their proposals, firms were on notice of how the agency wanted to have this requirement staffed. We disagree.

The TOR characterized this and the other pricing information included in section B as ceiling prices, rather than as "plug" prices. TOR, section B. (Each of the CLINs included a ceiling price, not just the optional O&M requirements CLINS). There is nothing in the solicitation that indicated that the agency expected the offerors to submit technical responses based on the maximum level of effort possible under the ceiling prices, or that the ceiling prices were anything other than an upper, not-to-exceed limit on contractor compensation. In fact, the agency specifically described the ceiling prices in a bidder question and answer as follows: "The ceiling price is the maximum that may be paid to the contractor except for any adjustment under other contract clauses providing for equitable adjustment or other revision of the contract price under stated circumstances." TOR, amend. 6, May 25, 2010, question No. 19.

In contrast, insofar as the relationship of the ceiling prices to the optional O&M requirements were concerned, the agency advised offerors (in its answer to a bidders' question) that the "Government will evaluate the proposed concept of how the O&M requirement will be handled." TOR, amend. 6, May 25, 2010, question No. 257. Such an evaluation approach presupposes that different concepts or approaches (including different staffing approaches and levels of effort) to meeting the O&M requirement were anticipated by the agency and would be evaluated. Simply stated, the agency's inclusion of the ceiling prices provided no meaningful information or guidance relating to the agency's desired staffing levels.

In summary, we find that the record provides an adequate basis for the agency to have taken corrective action. As discussed, the record supports the agency's conclusion that three of five competitors may have been eliminated from the competition because the offerors did not have adequate information to compete intelligently and on a relatively equal basis.  (Northrop Grumman Information Technology, Inc., B-404263.6, March 1, 2011)  (pdf)


As an initial matter, IMG asserts that the corrective action is unduly limited, and that the offerors instead should be given the opportunity to generally revise their proposal.

Contracting officers in negotiated procurements have broad discretion to take corrective action where the agency determines that such action is necessary to ensure a fair and impartial competition. Domain Name Alliance Registry, B-310803.2, Aug. 18, 2008, 2008 CPD para. 168 at 8. As a general matter, the details of a corrective action are within the sound discretion and judgment of the contracting agency. Rockwell Elec. Commerce Corp., B‑286201.6, Aug. 30, 2001, 2001 CPD para. 162 at 4. In this regard, an agency's discretion when taking corrective action extends to a decision on the scope of proposal revisions, and there are circumstances where an agency may reasonably decide to limit the revisions offerors may make to their proposals. See, e.g., Honeywell Technology Solutions, Inc., B‑400771.6, Nov. 23, 2009, 2009 CPD para. 240 at 4; Domain Name Alliance Registry; Computer Assocs. Int'l, supra; Rel-Tek Sys. & Design, Inc.-Modification of Remedy, B‑280463.7, July 1, 1999, 99-2 CPD para. 1 at 3. We generally will not object to the specific corrective action, so long as it is appropriate to remedy the concern that caused the agency to take corrective action. Networks Elec. Corp., B‑290666.3, Sept. 30, 2002, 2002 CPD para. 173 at 3.

Here, DLA's corrective action first focused on the very procurement deficiency (an unreasonable price realism evaluation) that led to GAO's ADR prediction that the protests would be sustained, and then turned to the other areas of concern identified during the ADR. In this regard, the agency amended the solicitation to clarify the assumed size of the required warehouse pallets and the force protection requirements, Amend. 26, and then advised offerors that they could submit a final technical proposal revision addressing either or both of these areas, as well as make any price revisions for which the offeror could provide documented evidence showing a direct link between changes in the proposal resulting from the two clarifications and the proposed pricing. DLA Letters to Offerors, Oct. 20, 2010. Since the agency's corrective action responded to the areas of concern identified by GAO, and nothing in IMG's protest demonstrates that the agency's approach was an abuse of discretion, we deny IMG's protest regarding the scope of the corrective action. Cf., Lockheed Martin Sys. Integration‑‑Owego; Sikorsky Aircraft Co., B‑299145.5; B‑299145.6, Aug. 30, 2007, 2007 CPD para. 155 at 6 (change in evaluation methodology required opportunity to respond to revised scheme).  (Intermarkets Global, B-400660.10; B-400660.11, February 2, 2011)  (pdf)


McKean argues that the Navy's proposed corrective action goes beyond what is required to address any concern with the cost evaluation, and is therefore unreasonable.[3] Since McKean has hired many of the incumbent personnel at the direction of the Navy, McKean argues that requiring it to submit a revised proposal will harm its chances of award.

Our Office requested that McKean further explain why it is necessary to restrict the Navy's discretion in taking corrective action here. McKean responded that BCI was not prejudiced by any error in the cost realism analysis because McKean's evaluated cost was significantly lower than BCI's. Thus, in McKean's view, the error in the cost realism analysis did not prejudice BCI, while the reopening of discussions will cause significant harm to McKean's competitive position. Accordingly, McKean argues that the Navy must limit its corrective action to a reevaluation of the proposals submitted previously. McKean Response to GAO, Nov. 3, 2009, at 5 (citing Security Consultants Group, Inc., B-293344.2, Mar. 19, 2004, 2004 CPD para. 53). We disagree.

In negotiated procurements, agencies have broad discretion to take corrective action where they determine that such action is necessary to ensure fair and impartial competition. MayaTech Corp., B-400491.4, B‑400491.5, Feb. 25, 2009, 2009 CPD para. 55 at 3. Where the corrective action taken by an agency is otherwise unobjectionable, a request for revised price proposals is not improper merely because the awardee's price has been exposed. Strand Hunt Constr., Inc., B-292415, Sept. 9, 2003, 2003 CPD para. 167 at 6. We have recognized a limited exception to that rule where the record establishes that there was no impropriety in the original evaluation and award, or that an actual impropriety did not result in any prejudice to offerors; where this is the case, reopening the competition after prices have been disclosed does not provide any benefit to the procurement system that would justify compromising the offerors' competitive positions. Security Consultants Group, supra, at 2-3; Hawaii Int'l Movers, Inc., B‑248131, Aug. 3, 1992, 92-2 CPD para. 67 at 6, recon. denied, Gunn Van Lines; Dept. of the Navy--Recon., B-248131.2, B-248131.4, Nov. 10, 1992, 92-2 CPD para. 336.

The Navy advises that it needs to reopen discussions to address potentially significant changes, due to the passage of time, in how the offerors will meet the agency's requirements. In our view, this is a matter where the agency has considerable discretion and we will not substitute our views for the Navy's on how the agency should proceed, absent a showing that this discretion is being abused. We see no such showing here.

Rather than being inconsistent with the rationale of our decision in Security Consultants Group, we view that decision as involving a critical difference. There, after identifying a flaw (the solicitation did not disclose that the past performance factor was nearly three times more significant than either of the other non-price factors), it appeared that none of the offerors had been competitively prejudiced by the incorrect weighting described in the solicitation. Nevertheless, the agency proposed to request revised proposals, but presented no reason to reopen the competition. In contrast, here, the Navy has presented both a flaw requiring corrective action (an error in the cost realism evaluation) and a reasonable basis why reopening the competition is appropriate to achieve a fair competition--i.e., the likelihood that one or both offerors would need to make significant personnel/ resume changes in their initial proposals.

In our view the Navy has shown a reasonable basis for conducting discussions and requesting revised proposals. Doing so is within the discretion of the Navy to determine the scope of corrective action, and therefore we will not substitute our judgment for the agency's.  (McKean Defense Group--Information Technology, B-401702.2, LLC, January 11, 2010) (pdf)


The original RFP contained three technical evaluation factors--technical approach, management and staffing, and past performance. When combined, those factors were significantly more important than cost/price. Original RFP at 41. Three offerors, including the awardee and the protester, submitted proposals. The earlier protest followed contract award.

In response to that protest, the agency announced it would take the following corrective action: amend the solicitation to reflect that the combination of the technical factors is approximately equal to (not significantly more important than) price; accept revised proposals; reevaluate; and make a new award decision. The contracting officer asserts that the protest warranted corrective action for two main reasons. The protester complained that it had not been accorded the opportunity to respond to negative past performance information, as required by Federal Acquisition Regulation sect. 15.306. The contracting officer saw reopening the competition to allow the protester to respond as "the only way to remedy the agency error in evaluating adverse past performance information." Contracting Officer's Statement of Facts at 2. The contracting officer also discovered an error in section M of the RFP; contrary to the terms of the original RFP, the agency did not intend for the technical factors to be significantly more important than cost/price. Accordingly, the RFP was amended to state that all evaluation factors other than cost/price, when combined, are approximately equal to cost/price. Id. at 3.

We see no basis to object to the agency's corrective action. The contracting officer states that the original RFP was in error when it identified the combined technical factors as significantly more important than cost/price. Contracting Officer's Statement of Facts at 3. A contracting agency properly may take corrective action in order to rectify an error in the solicitation concerning the basis for award, where there is no evidence that the agency acted in other than good faith. Alfa Consult S.A., B-298164.2, B-298288, Aug. 3, 2006, 2006 CPD para. 127 at 2. Here, the agency reasonably remedied the misstatement of the relative weight of the evaluation factors by amending the solicitation and requesting revised proposals.

The protester argues that the agency in fact acted in bad faith and that its corrective action intentionally favored the prior awardee. See Comments, Sept. 12, 2010 at 7. The protester offers no evidence to support its assertion of agency bias, other than its own bare allegation that the agency's actions improperly favored the awardee. Government procurement officials are presumed to act in good faith, and we will not attribute unfair or prejudicial motives to them on the basis of inference or supposition. Triton Marine Constr. Corp., B-250856, Feb. 23, 1993, 93-1 CPD para. 171 at 6. In the absence of any evidence of bias in the record, we see no merit to this protest allegation.

The protester also asserts, correctly, that the agency's corrective action does not address certain of the protester's original protest grounds. For example, the protester asserted in the underlying protest that the awardee had an unmitigated conflict of interest. There is currently no contract award and, therefore, no alleged violation of procurement regulation or statute to protest. The protester's allegations are premised on the agency making award to the same firm again, and, because they anticipate allegedly improper agency action, they are speculative and premature. Paramount Group, Inc., B-298082, June 15, 2006, 2006 CPD para. 98 at 6-7. Our Office will not assume in advance that an agency will conduct its procurements improperly.  (Training Management Solutions, Inc., B-403461.2, September 29, 2010)  (pdf)


Contracting officers in negotiated procurements have broad discretion to take corrective action where the agency determines that such action is necessary to ensure a fair and impartial competition. Domain Name Alliance Registry, B-310803.2, Aug. 18, 2008, 2008 CPD para. 168 at 8; Computer Assocs. Int'l, B-292077.2, Sept. 4, 2003, 2003 CPD para. 157 at 5. An agency's discretion when taking corrective action also extends to a decision on the scope of proposal revisions, and there are circumstances where an agency may reasonably decide to limit the revisions offerors may make to their proposals. See, e.g., Computer Assocs. Int'l, supra; Rel-Tek Sys. & Design, Inc.--Modification of Remedy, B-280463.7, July 1, 1999, 99-2 CPD para. 1 at 3. In instances where the corrective action does not also include amending the solicitation, we will not question an agency's decision to restrict proposal revisions when taking corrective action so long as it is reasonable in nature and remedies the established or suspected procurement impropriety. See Consolidated Eng'g Servs., Inc., B-293864.2, Oct. 25, 2004, 2004 CPD para. 214 at 3-4; Computer Assocs. Int'l, supra.

As a preliminary matter, the parties agree that NASA's corrective action here does not include amending either the solicitation's substantive requirements or evaluation scheme. Additionally, Honeywell does not dispute that NASA's corrective action remedies the established or suspected procurement impropriety (i.e., the agency's evaluation of ITT's past performance). Rather, the crux of Honeywell's objections is that the agency's corrective action does not go far enough, insofar as offerors should be permitted to submit unlimited proposal revisions.

The agency's decision to limit the scope of its corrective action was reasonable. As noted above, our January 27 decision found that NASA's evaluation of ITT's past performance was improper, but that Honeywell's remaining challenges to the evaluation of offerors' proposals were without merit: in light thereof, our recommendation was limited to remedying the identified problem regarding the past performance evaluation. Further, after the June 25 outcome prediction ADR conference, NASA took corrective action to remedy the problem identified regarding the past performance evaluation and, at the same time, decided to obtain updated information from both offerors in that area. In our view, NASA's decision to update the past performance information from each offeror was a reasonable way to remedy the identified procurement impropriety while not affecting other portions of offerors' proposals and the evaluation thereof. This approach has the added benefit of reducing further cost and delay in the procurement. See Computer Assocs. Int'l, Inc., supra; Serv-Air, Inc., B-258243.4, Mar. 3, 1995, 95-1 CPD para. 125 at 2-3. We therefore conclude that the agency acted within its discretion in limiting the revisions offerors may make to their proposals.  (Honeywell Technology Solutions, Inc., B-400771.6, November 23, 2009) (pdf)


First, Pemco asserts that the agency was obligated to reopen discussions with the offerors in order to obtain additional information prior to performing the price realism and risk analysis required by the solicitation and recommended by our Office, and that its failure to do so rendered the subsequent source selection decision improper.

As a general rule, the details of implementing recommendations of our Office are within the sound discretion and judgment of the contracting agency, and we will not question an agency’s ultimate manner of compliance, so long as it remedies the procurement impropriety that was the basis for our recommendation. See, e. g., Partnership for Response and Recovery, B-298443.4, Dec. 18, 2006, 2006 CPD para. 3 at 3; ST Aerospace Engines Pte, Ltd., B-275725.3, Oct. 17, 1997, 97-2 CPD para. 106 at 5. In this regard, an agency’s discretion generally extends to determining whether it is necessary to reopen discussions and obtain proposal revisions. See SDS Int’l, Inc. B‑291183.4, Apr. 28, 2003, 2003 CPD para. 127 at 6; Computer Assocs. Int’l, B‑292077.2, Sept. 4, 2003, 2003 CPD para. 157 at 5.

Here, our decision sustaining Pemco’s prior protest was based on the absence of any agency documentation reflecting the agency’s judgments regarding price realism and proposal risk in the context of Boeing’s final proposal revisions. Pemco’s assertion that the agency was required to reopen discussions appears to be based on a perception that our Office found Boeing’s proposal to be informationally deficient; we did not. In this regard, it is not the function of our Office to evaluate proposals; rather, we will examine the procurement record created by the agency to determine whether the agency’s evaluation was consistent with the solicitation requirements and applicable statutes and regulations. E.g. Pacific Ship Repair and Fabrications, B‑279793, July 23, 1998, 98-2 CPD para. 29 at 3‑4.

Since our prior decision was based on an informational deficiency in the agency’s evaluation record, it was not unreasonable for the agency to correct that deficiency by performing, and documenting, the required analyses based on the information that was already available. Pemco’s assertion that the agency was obligated to reopen discussions with all of the offerors is without merit. (Pemco Aeroplex, Inc., B-310372.3, June 13, 2008) (pdf)  (See prior decision,
Pemco Aeroplex, Inc., B-310372, December 27, 2007)


An agency’s discretion in the area of corrective action extends to deciding the scope of proposal revisions, and there are circumstances where an agency reasonably may decide to limit revisions offerors make to their proposals. See, e.g., Computer Assocs. Int’l, B-292077.2, Sept. 4, 2003, 2003 CPD para. 157 at 5. Where, as here, an agency decides to amend a solicitation after closing and permit offerors to revise their proposals in response, however, we think that offerors should be permitted to revise any aspect of their proposals, including those that were not the subject of the amendment, unless the agency offers evidence that the amendment could not reasonably have any effect on other aspects of proposals, or that allowing such revisions would have a detrimental impact on the competitive process. Unlike in prior cases where we found that agencies could limit the extent to which proposals may be revised, see, e.g., Rel-Tek Sys. & Design, Inc.--Modification of Remedy, supra; ST Aerospace Engines Pte. Ltd., B-275725.3, Oct. 17, 1997, 97-2 CPD para. 106 at 4; System Planning Corp., B-244697.2, June 15, 1992, 92-1 CPD para. 516 at 4, the agency has not made such a showing here. The record does not contain any argument from the Navy that allowing offerors to submit revised proposals would impair the competitive process in any way. With respect to the effect of the amendment on proposals, the Navy argues that it made no revisions to the RFP that would have an impact on scheduling, and thus there is no reason for it to permit offerors to revise their proposed schedules. We disagree. Clearly, amending the solicitation to permit exercise of the options for line items 0003-0007 for up to 365 days after notice to proceed for line item 0001 could have an impact on offerors’ schedules, which were based on exercise of these options 8 months after contract award. Even to the extent that the delay in the performance period could not reasonably be expected to have an impact on the sequencing and duration of the various construction tasks, we agree with the protester that it could be expected to have an impact on schedule-related matters such as the availability of subcontractors and, depending on the time of year at which notice to proceed is issued, accounting for holiday periods. We are also persuaded that where, as here, price revisions are permitted, offerors should be allowed to revise any portions of their technical proposals that could have an impact on their pricing, which clearly would include schedule. In sum, without some rational basis for denying offerors the ability to make revisions to all portions of their proposals, we think the Navy’s decision to limit the scope of revisions to technical proposals was unreasonable. Accordingly, we sustain CMR’s protest against the agency’s failure to permit it to revise its schedule in its final offer. (Cooperativa Muratori Riuniti, B-294980.5, July 27, 2005) (pdf)


As a preliminary matter, although it characterizes its current filing as a request for reconsideration, Envirosolve does not argue that we should not have dismissed its earlier protest because the agencys proposed corrective action did not, in fact, render the protest academic. Compare Saltwater Inc.--Recon. and Costs , B-294121.3, B-294121.4, Feb.8, 2005, 2005 CPD 33. Instead, Envirosolve argues that DEA has failed to take the corrective action promised within the time period promised. A protest, like the one here, that was once academic is not revived by subsequent agency action or inaction. Rather, the subsequent agency conduct gives rise to a new basis for protest even if some of the issues raised by the subsequent action are the same as the issues raised under the earlier protest. See Lackland 21st Century Servs. Consol.--Protest and Costs , B-285938.6, July 13, 2001, 2001 CPD 124 at 4. (Envirosolve LLC, B-294974.4, June 8, 2005)  (pdf)


Four vendors, including CMC and SSG, submitted quotations, which were evaluated by the then-cognizant contracting officer, who alone evaluated their technical qualifications. The contracting officer summarized her adjectival ratings in matrix form and, without identifying the vendors by name, furnished them to the three member technical evaluation panel (TEP) for review. Based on this review, bidder 1 (SSG) was rated technically lower, and had a lower price, than bidder 2 (CMC); the TEP thus recommended award to CMC. After awarding the contract to CMC, the contracting officer left federal service and was replaced by another individual. Thereafter, SSG requested a debriefing, but when the replacement contracting officer reviewed the contracting file, she determined that the evaluation was so flawed that it had to be redone. She notified the vendors and had the TEP review each vendor's quotation, individually score them, and then complete a consensus evaluation. The TEP's consensus evaluation rated CMC's quotation as good under the technical factor and unsatisfactory under the past performance factor, while rating SSG's quotation as outstanding under both factors. Based on SSG's technical ratings and low price, the contracting officer terminated CMC's contract and made award to SSG. Upon learning of the termination of its contract and the new award, CMC filed this protest. Here, the replacement contracting officer's decision to take corrective action was both reasonable and appropriate because the original evaluation and its record were significantly flawed. Specifically, even though the quotations were to be evaluated on the basis of technical qualifications and past performance, there was nothing--no strengths or weaknesses--listed in the evaluation record to support the original contracting officer's adjectival ratings for the vendors. Further, the evaluation matrix was inconsistent with SSG's past performance information. Specifically, one of SSG's past performance questionnaire respondents had indicated that he would do business with SSG again, and the other had indicated that he "maybe" would do business with SSG again. However, the original evaluation matrix indicated that these respondents had answered "maybe" and "no," a significant difference. Moreover, the TEP members, charged with responsibility for evaluating the proposals, had not reviewed either proposal before making their initial award recommendation. Given the agency's reliance on erroneous information, the lack of supporting narrative, and the absence from the record of any information supporting the TEP's award recommendation, the award determination was unsupportable and potentially subject to a successful protest challenge. U.S. Defense Sys., Inc. , supra . Under these circumstances it was within the agency's discretion to reevaluate the quotations and make a new award determination based on a fully documented evaluation record. Since following this course resulted in a determination that SSG's proposal, rather than CMC's, represented the best value, the termination of CMC's contract and issuance of a new contract to SSG were unobjectionable.  (CMC & Maintenance, Inc., B-293803.2, December 2, 2004)  (pdf)


Under the circumstances here, it was reasonable for the agency to limit the vendors’ submissions to revised price quotes. As noted above, USDA determined that its evaluation of CA’s price quote may have been improper, and that the subsequent source selection decision had not been adequately documented. By contrast, the agency found nothing improper in its evaluation of the vendors’ technical quotes and found no merit to CA’s allegation concerning an unstated minimum requirement for an integrated multiple platform software product. The agency also determined that the cost of conducting the initial technical evaluation of quotes--and presumably, the approximate cost for conducting a second technical evaluation of quotes--was more than $42,000. Contracting Officer’s Statement, June 18, 2003, at 1; AR, Tab F, TET Leader Statement, June 20, 2003, at 2-3. In our view, USDA’s limited request for price information from each vendor was a reasonable way to remedy the suspected procurement impropriety while not affecting other portions of vendors’ quotes and the evaluation thereof. This approach has the added benefit of reducing further cost and delay in the procurement. We therefore conclude that the agency acted within its discretion in limiting the revisions vendors may make to their quotes. (Computer Associates International, Inc., B-292077.2, September 4, 2003) (pdf)


To the extent HTI contends that the corrective action had no effect on the competition and merely “glosses over” improprieties in the solicitation, Comments at 3-7, its disagreement with the scope of the corrective action--that the agency’s corrective action did not remedy HTI’s challenge to the agency’s evaluation of PCCI’s proposal and the award decision--does not provide a basis to question the agency’s actions. We think the VA’s decision to solicit and evaluate revised proposals and to make a new best-value determination based on that reevaluation renders academic HTI’s protest of the initial evaluation and award decision. In short, the other alleged deficiencies or improprieties identified in HTI’s earlier protest became moot where the agency’s decision to reopen the competition and make a new best value determination afforded the protester another opportunity to be considered for award.  (Hyperbaric Technologies, Inc., B-293047.2; B-293047.3, February 11, 2004)


The Air Force determined that, despite amendment No. 0001 and the FedBizOpps posting, some offerors had been confused regarding the pricing instructions, and that corrective action was appropriate. On October 23, the Air Force notified PCA of its intended corrective action, and on November 3 the agency rescinded the award. PCA contends that corrective action was unwarranted and “not supported by any credible evidence.” Supplemental Comments at 2. The protester argues that the corrective action would be proper only if AIM “was in fact misled” by the solicitation or by the agency’s letters and amendments aimed at clarifying the pricing. Id. In this regard, PCA argues that “no one was disadvantaged by the omission (on some [September 15] letters) of the ‘critical sentence’,” because all letters advised offerors to refer to amendment No. 0001 and to the FedBizOpps memo, receipt of which AIM acknowledged in its protest. Comments at 2. In negotiated procurements, agencies have broad discretion to take corrective action where they determine that such action is necessary to ensure fair and impartial competition. Patriot Contract Servs., LLC et al., B-278276.11 et al., Sept. 22, 1998, 98‑2 CPD ¶ 77 at 4. Where an agency has reasonable concerns that there were errors in a procurement, the agency may take corrective action, even if it is not certain that a protest of the procurement would be sustained. Main Bldg. Maint., Inc., B‑279191.3, Aug. 5, 1998, 98-2 CPD ¶ 47 at 3. We will not object to proposed corrective action, so long as it is appropriate to remedy the concern that caused the agency to take corrective action. Network Elec. Corp., B-290666.3, Sept. 30, 2002 CPD ¶ 173 at 3. The corrective action here is unobjectionable. The prices received varied dramatically--as noted above, from approximately [DELETED] to [DELETED] for all offerors and from [DELETED] to [DELETED] for competitive range offerors--and the agency concluded that the offerors’ approaches to pricing titanium was the likely cause of the disparity, notwithstanding its efforts to clarify the CAP line item. We have recognized that such dramatic price differentials may reasonably be interpreted to suggest that offerors had dissimilar understandings of the requirements. See Federal Sec. Sys., Inc., B-281745.2, Apr. 29, 1999, 99-1 CPD ¶ 86 at 5. In these circumstances, agencies are not required to ignore the reasonable possibility that the disparate prices received do not accurately reflect the competitive marketplace, and that the award based on those prices may not reflect the most advantageous proposal. Thus, notwithstanding the protester’s arguments to the contrary--to the effect that all offerors should have understood titanium pricing under the CAP line item--there was nothing unreasonable in the agency’s determination that corrective action was necessary to ensure both that the competition was fair and that the award would be based on the most advantageous proposal. (PCA Aerospace, Inc., B-293042.3, February 17, 2004)  (pdf)


The agency’s acceptance of Strand’s noncompliant proposal meant that the agency waived these design criteria for Strand, which resulted in an unfair and unequal evaluation. It is a fundamental principle of federal procurement that competition must be conducted on an equal basis; that is, offerors must be treated equally and be provided with a common basis for the preparation of their proposals. SWR, Inc., B-284075, B-284075.2, Feb. 16, 2000, 2000 CPD ¶ 43 at 3. Accordingly, the Corps reasonably determined that it was necessary to terminate Strand’s contract in order to correct the improper award.  (Strand Hunt Construction, Inc., B-292415, September 9, 2003) (pdf)


While, as the protester suggests, a more comprehensive method of implementing our recommendation could have been chosen by the Air Force, including reopening discussions and obtaining revised proposals and reevaluating past performance, the agency has stated a reasonable basis for not performing these actions. Specifically, the record does not show any weaknesses or deficiencies in SDS's proposal that required discussions.  Moreover, SDS has offered no new evidence, not considered in our prior decision, that would indicate that the past performance ratings of SDS and CBD were not reasonable. Finally, it was within the discretion of the agency to consider the mission capability factor as a whole, since our prior decision did not preclude this evaluation and it has offered a reasonable explanation (set forth above) as to why it was necessary.  (SDS International, Inc., B-291183.4; B-291183.5, April 28, 2003)


Considering the actual staffing included in SMI's FPR pricing was consistent with the scope of the reopened discussions.  SMI's explanation that its FPR pricing included an additional risk mitigation allowance of [DELETED] FTEs was responsive to the goal established for the reopened discussions--that SMI demonstrate the realism of its proposed pricing, including demonstrating that it was offering adequate staffing. Indeed, the agency would have failed in its obligation to evaluate the reasonableness of the proposed pricing had it not considered the actual staffing included in SMI's pricing. Also consistent with the limitations established in the reopened solicitation is the fact that the additional staffing was not used to alter the evaluation of SMI's organization and management plans, small business subcontracting plan, and past performance. RFP § M.3.4.2. We conclude that USMC reasonably evaluated SMI's second FPR based on a staffing level of [DELETED] FTEs. J.W. (Holding Group & Associates, Inc., B-285882.11; B-285882.12, October 23, 2002)  (pdf)


Where, as here, an agency has improperly conducted discussions with only one offeror after receipt of proposals, reopening the competition and seeking another round of amended proposals is an appropriate way to remedy the underlying deficiency and permit offerors a fair opportunity to compete.  International Res. Group, B-286683, Jan. 31, 2001, 2001 CPD ¶ 35.  The  disclosure of pricing and other information in another offeror's proposal, as here, is permissible because the possibility that the contract may not have been awarded based on a true determination of the most advantageous proposal has a more harmful effect on the integrity of the competitive procurement system than the fear of an auction; the statutory requirements for competition take priority over any possible constraints on auction techniques.  Federal Sec. Sys., Inc., supra, at 4.  Accordingly, the agency's corrective action of disclosure and placing the offerors on an even footing, and providing them with an equal opportunity to compete by submitting new proposals is unobjectionable here.  (Networks Electronic Corporation, B-290666.3, September 30, 2002)  (pdf)


Where agency took corrective action in response to an earlier protest by amending the solicitation and reopening discussions, the prior disclosure of protester's prices and the request for final proposal revisions did not create an improper auction.  (Clearwater Instrumentation, Inc., B-286454.2, September 12, 2001)


As a general matter, the details of implementing our recommendations for corrective action are within the sound discretion and judgment of the contracting agency. Rel-Tek Sys. & Design, Inc.--Modification of Remedy, B-280463.7, July 1, 1999, 99-2 CPD para. 1 at 3. Such discretion must be exercised reasonably and in a fashion that remedies the procurement impropriety that was the basis for our protest recommendation. The Futures Group Int'l, B-281274.5 et al., Mar. 10, 2000, 2000 CPD para. 148 at 8; CitiWest Properties, Inc., B-274689.4, Nov. 26, 1997, 98-1 CPD para. 3 at 6. Here, the agency did not act reasonably in reopening discussions only with MCI, nor did the agency's remedy resolve all the improprieties that were the basis for our decision sustaining the prior protest.  (Rockwell Electronic Commerce Corporation, B-286201.6, August 30, 2001)  (pdf)


A protest, like the one here, that was once academic is not "revived" by subsequent agency action. Instead, the subsequent action gives rise to a new basis for protest, even if some of the issues raised by the subsequent action are the same as the issues raised under the earlier protest. See Pemco Aeroplex, Inc.-Recon. and Costs, B-275587.5, B-275587.6, Oct. 14, 1997, 97-2 CPD para. 102 at 4-5. With respect to the specific request here, on December 13, the Air Force conceded that its initial decision that it would be more economical to perform base operations support at Lackland in-house, rather than contract out this effort, was improper. Thus, the decision that L-21 would have us consider no longer exists, and any dispute about that decision has been rendered academic by the concession in the Air Force's letter of December 13. QuanTech, Inc.--Costs, B-278380.3, June 17, 1998, 98-1 CPD para. 165 at 2.  (A-76 issue)  (Lackland 21st Century Services Consolidated--Protest and Costs, B-285938.6, July 13, 2001)


Generally, we decline to review the termination of contracts for the convenience of the government because such actions are matters of contract administration. We will review the propriety of the termination where the termination flows from a defect the contracting agency perceived in the award process. In such cases, we examine the award procedures that underlie the termination action for the limited purpose of determining whether the initial award may have been improper and, if so, whether the corrective action taken was appropriate to protect the integrity of the competitive procurement system. GAI, Inc., B-247962, B-247971, July 8, 1992, 92-2 CPD para. 10 at 3. We will not object to an agency's proposed corrective action where the agency concludes that the award, because of perceived flaws in the procurement process, was not necessarily made on the basis most advantageous to the government, so long as the corrective action taken is appropriate to remedy the impropriety. Rockville Mailing Serv., Inc., B-270161.2, Apr. 10, 1996, 96-1 CPD para. 184 at 4. The record contains abundant evidence that this was a flawed procurement resulting in an award not necessarily made on the basis most advantageous to the government, and that the agency's corrective action is appropriate.  (Fisher-Cal Industries, Inc., B-285150.2, July 6, 2000)


Where award of indefinite-delivery, indefinite-quantity contract improperly was made to large business, proposed corrective action is reasonable, and warrants dismissing protest as academic, where agency will (1) allow improperly awarded contract to expire, (2) place no new delivery orders under the contract, but allow delivery orders already issued to be performed pending recompetition and new award, and (3) promptly conduct recompetition, with award to be made within 6 months.  (Landmark Construction Corporation, B-281957.3, October 22, 1999)


Contracting officials in negotiated procurements have broad discretion to take corrective action where the agency determines that such action is necessary to ensure fair and impartial competition. Patriot Contract Servs., LLC et al., B-278276.11 et al., Sept. 22, 1998, 98-2 CPD para. 77 at 4; Rockville Mailing Serv., Inc., B-270161.2, Apr. 10, 1996, 96-1 CPD para. 184 at 4. It is not necessary for an agency to conclude that the protest is certain to be sustained before it may take corrective action; where the agency has reasonable concern that there were errors in the procurement, even if the protest could be denied, we view it as within the agency's discretion to take corrective action. Patriot Contract Servs., LLC et al., supra. An agency may amend a solicitation, and request and evaluate another round of BAFOs where the record shows that the agency made the decision to take this action in good faith, without the specific intent of changing a particular offeror's technical ranking or avoiding an award to a particular offeror. See PRC, Inc., B-233561.8, B-233561.9, Sept. 29, 1992, 92-2 CPD para. 215 at 3-4.  (Federal Security Systems, Inc., B-281745.2, April 29, 1999)

Comptroller General - Listing of Decisions

For the Government For the Protester
American Warehouse Systems, LLC B-412543: Mar 1, 2016  (pdf) Deloitte Consulting, LLP B-412125.6: Nov 28, 2016
Research Analysis & Maintenance, Inc. B-410570.6, B-410570.7: Jul 22, 2015  (pdf) FCi Federal, Inc. B-408558.7, B-408558.8: Aug 5, 2015  (pdf)
WAI-Stoller Services, LLC; Portage, Inc. B-408248.13, B-408248.14, B-408248.15, B-408248.16, B-408248.17, B-408248.18, B-408248.19, B-408248.20: May 29, 2015  (pdf) Cooperativa Muratori Riuniti, B-294980.5, July 27, 2005 (pdf)
AXIS Management Group, LLC, B-408575.2: May 9, 2014  (pdf) Envirosolve LLC, B-294974.4, June 8, 2005  (pdf)
Northrop Grumman Technical Services, Inc., B-404636.11, June 15, 2011  (pdf) Rockwell Electronic Commerce Corporation, B-286201.6, August 30, 2001  (pdf)
Northrop Grumman Information Technology, Inc., B-404263.6, March 1, 2011  (pdf)  
Intermarkets Global, B-400660.10; B-400660.11, February 2, 2011  (pdf)  
McKean Defense Group--Information Technology, B-401702.2, LLC, January 11, 2010  
Training Management Solutions, Inc., B-403461.2, September 29, 2010  (pdf)  
Honeywell Technology Solutions, Inc., B-400771.6, November 23, 2009 (pdf)  
Pemco Aeroplex, Inc., B-310372.3, June 13, 2008 (pdf)  
CMC & Maintenance, Inc., B-293803.2, December 2, 2004  (pdf)  
Computer Associates International, Inc., B-292077.2, September 4, 2003 (pdf)  
Hyperbaric Technologies, Inc., B-293047.2; B-293047.3, February 11, 2004 (pdf)  
PCA Aerospace, Inc., B-293042.3, February 17, 2004  (pdf)  
Strand Hunt Construction, Inc., B-292415, September 9, 2003) (pdf)  
SDS International, Inc., B-291183.4; B-291183.5, April 28, 2003  (pdf)  
Holding Group & Associates, Inc., B-285882.11; B-285882.12, October 23, 2002  (pdf)  
Networks Electronic Corporation, B-290666.3, September 30, 2002  (pdf)  
Omega World Travel, Inc.; SatoTravel, Inc., B-288861.5; B-288861.6; B-288861.7, August 21, 2002  (pdf)  
Alatech Healthcare, LLC--Protest; Custom Services International, Inc.--Costs, B-289134.3; B-289134.4, April 29, 2002  (PDF Version)  
TyeCom, Inc., B-287321.3; B-287321.4, April 29, 2002  
Royal Hawaiian Movers, Inc., B-288653, October 31, 2001 (Reverse auction issue)  (PDF Version)  
Clearwater Instrumentation, Inc., B-286454.2, September 12, 2001  
Johnson Controls World Services, Inc., B-286714.3, August 20, 2001  (A-76 issue)  (PDF Version)  
Lackland 21st Century Services Consolidated--Protest and Costs, B-285938.6, July 13, 2001  (A-76 issue)  (PDF Version)  
Fisher-Cal Industries, Inc., B-285150.2, July 6, 2000  (PDF Version)  
Landmark Construction Corporation, B-281957.3, October 22, 1999  (PDF Version)  
Rel-Tek Systems & Design, Inc. -- Modification of Remedy, B-280463.7, July 1, 1999  (pdf)  
Federal Security Systems, Inc., B-281745.2, April 29, 1999  (PDF Version)  

U. S. Court of Federal Claims - Key Excerpts

New A. The Decision to Take Corrective Action

In deciding to take corrective action, the Army found that an error occurred when it considered Jacobs’ revised oral presentation slides during the third evaluation process. Under the terms of the solicitation, “[c]ontent on [oral presentation] slides submitted, but not briefed in the [oral] presentation, [would] not be considered in the evaluation.” AR 23-2622. The Army restated this requirement before the submission of proposals for the third award, noting that if an offeror revised its oral presentation slides, “an oral presentation briefing [would be] required to have the slides considered.” AR 77b-6272. If necessary, that oral presentation was to take place on July 21, 2016. AR 77c-6275. Jacobs submitted its proposal on July 20, 2016 for the third award without making a new oral presentation during the third evaluation process, see AR 78- 6279; AR 114-8933, but then changed many of its oral presentation slides in its revised proposal submitted on September 23, 2016, see AR 118-9939 to -40. The Army cited Jacobs’ submission of revised oral presentation slides without a new presentation as one of the Army’s bases for corrective action, explaining that “the Army relied upon these un-briefed slide revisions” when evaluating Jacobs’ mission capability approach, which was in violation of the solicitation. AR 114-8933.

Jacobs acknowledges that it erred by submitting revised slides, which were considered by the Army, but not then making a new oral presentation. Hr’g Tr. 14:14-19 (Feb. 9, 2017), No. 16-1602C. Jacobs also accepts the Army’s assessment that the revisions were “numerous.” See Hr’g Tr. 14:20-21; AR 114-8933.21 Nonetheless, Jacobs argues that the Army’s decision to take corrective action was unwarranted because the Army’s consideration of the revised slides did not affect the evaluation of Jacobs’ proposal or the outcome of the third award process, and therefore the error was “not prejudicial.” Jacobs’ Mot. at 15-23. Jacobs supports its claim by asserting that the changes to the slides were administrative and unrelated to its mission capability approach, nearly all of the changes appeared elsewhere in its proposal, and it received identical ratings for mission capability before and after submission of the revised slides. See id. at 15-16, 19-20; Jacobs’ Opp’n to Cross-Mots. at 9

Jacobs points to the general precept that to prevail in a bid protest, “[a] protester must show not simply a significant error in the procurement process, but also that the error was prejudicial.” Statistica, Inc. v. Christopher, 102 F.3d 1577, 1581 (Fed. Cir. 1996) (citation omitted); see also Jacobs’ Mot. at 21. Under this maxim, a bid protester must show that an alleged error by the procuring agency prejudiced the protester; the rule does not, on the other hand, stand for the proposition that an agency can rationally act in a procurement to institute corrective action only when there is an error coupled with a showing of prejudice to an offeror. See MSC Indus. Direct Co. v. United States, 126 Fed. Cl. 525, 533 n.5 (2016) (“The considerations brought to bear when it is the agency’s own procurement needs that prompt corrective action are fundamentally different from a situation in which a competitor alleges that corrective action is warranted by potential prejudice to it.”). Jacobs seeks to place a burden of demonstrating prejudice on the agency, asserting that “corrective action must be based on a prejudicial error.” Jacobs’ Mot. at 21. However, Jacobs’ attempt to impose a prejudice requirement on the Army’s decision to take corrective action is unsupported by any precedent in the Federal Circuit or this court. Instead, it is inconsistent with prior case law addressing corrective action. See Wildflower Int’l, 105 Fed. Cl. at 389 n.18 (addressing a corrective action protest and noting that “whether [an offeror] was specifically prejudiced by the ambiguity [in the solicitation] is not dispositive”); Jacobs, 100 Fed. Cl. at 197 (“[E]ven if GAO denied the protest (e.g., for lack of prejudice), the agency could still decide to take corrective action.”).

Jacobs supports its proffered “prejudicial error” rule by relying on a GAO decision, Security Consultants Grp., Inc., B-293344.2, 2004 WL 691223 (Comp. Gen. Mar. 19, 2004), recons. granted in part and denied in part, B-293344.6, 2004 WL 2480957 (Comp. Gen. Nov. 4, 2004). In that decision, GAO stated:

Where the corrective action taken by an agency is otherwise unobjectionable, a request for revised price proposals is not improper merely because the awardee’s price has been exposed. . . . We have recognized a limited exception to that rule where the record establishes that there was no impropriety in the original evaluation and award, or that an actual impropriety did not result in any prejudice to offerors[. In that circumstance,] reopening the competition after prices have been disclosed does not provide any benefit to the procurement system that would justify compromising the offerors’ competitive positions.

Security Consultants Grp., 2004 WL 691223, at *2 (citations omitted). Jacobs’ reliance on Security Consultants is unavailing. The basis for the decision in Security Consultants is distinguishable from the protest before this court. In Security Consultants, GAO determined that if an error in the solicitation did not prejudice the offerors and prices had been disclosed, the agency’s reopening of the competition would not be warranted. 2004 WL 691223, at *2. Here, however, the Army is currently only reevaluating proposals and has not reopened discussions. See AR 114-8933. Accordingly, GAO’s concern that price disclosure would “compromis[e] the offerors’ competitive positions,” 2004 WL 691223, at *2, is not applicable in this dispute.

Even if the Army had reopened the competition, the commentary in Security Consultants only applies when prices had been disclosed and there was no impropriety in the evaluation and award process, or when the impropriety occurred but did not prejudice the offerors. 2004 WL 691223, at *2. Here, an error occurred when the Army considered Jacobs’ revised slides. AR 114-8933. And to the extent that prejudice is relevant, the court rejects Jacobs’ assertion that no prejudice occurred from the submission of Jacobs’ revised, but un-briefed, slides. As the Army explained, Jacobs’ revisions were “numerous and substantive,” and “Jacobs’ failure to provide a new oral presentation deprived the Army from asking questions during the clarification session.” AR 114-8933. Jacobs’ revised slides included changes to its organization chart, contracting team, key personnel, and cost reduction metric, among other changes. See AR 118-9939 to -40. These changes specifically related to the mission capability requirements set forth in the RFP, see, e.g., AR 3-189 (requiring offerors to address “the expertise of each proposed team member and/or subcontractor” under the technical risk sub-factor of mission capability), and thus substantively affected Jacobs’ mission capability approach. Jacobs’ supporting contention that no prejudice occurred because it received the highest possible ratings for mission capability both before, AR 93-8548, and after it submitted revised slides, AR 104-8708; see Jacobs’ Mot. at 19- 20, is based on unjustified assumptions and inferences. The extent to which the revised slides benefitted Jacobs’ evaluation is not evident from the administrative record. What is apparent from the record is that the Army had questions about the topics Jacobs covered in its revised proposal submitted after the time for oral presentations had passed. On August 30, 2016 and September 6, 2016, the Contracting Officer issued Evaluation Notices (“ENs”) to Jacobs asking it to identify who would perform certain work due to the deletion of a subcontractor from its previously proposed team. AR 84-8447 to -49; AR 88-8477. Jacobs responded to the ENs on September 8, 2016, stating that it was updating its “Staffing Plan, Past Performance proposal, Small Business Participation Plan, and Cost Volume.” AR 116-8937. Several weeks thereafter, on September 23, 2016, Jacobs submitted its final proposal revision and its revised slides. See AR Tab 118. On the same day, TRAX submitted its final proposal revisions. AR Tab 119. Based on this timing, TRAX claims that Jacobs received an unfair advantage. See TRAX’s Reply in Support of its Cross-Mot. for Judgment on the Administrative Record (“TRAX’s Reply in Support of Cross-Mot.”) at 15, No. 16-1602C, ECF No. 54, and the government makes a similar, albeit more cryptic, contention, see Def.’s Reply to Pl.’s Resp. and Reply to Def.’s Cross[-]Mot. for Judgment on the Administrative Record (“Def.’s Reply in Support of CrossMot.”) at 2, No. 16-1602C, ECF No. 53. In these circumstances, it is apparent that the Army’s procurement officials had at least some questions about Jacobs’ final revised proposal. These questions may have been answered by Jacobs’ responses to the ENs and by revisions to Jacobs’ slides, but an oral interchange and interlocution may have served a clarifying purpose, as the solicitation contemplated. The court has no basis in the record to discount that possibility or the Army’s decision to take corrective action on that ground. Thus, for the reasons stated, the Army’s decision to take corrective action was reasonable.  (Jacobs Technology Inc. v. U. S. and TRAX International Corporation; TRAX International Corporation v. U. S. and Jacobs Technology Inc., Nos. 16-1602C & 17-88C, April 7, 2017)


In this case, the government contends that the corrective action that FHWA took was reasonable because it was among the two alternative recommended corrective actions that GAO suggested after it upheld PSI’s protest. Def.’s Mot. at 18. Thus, GAO stated that if FHWA concluded that the original solicitation did not accurately reflect its needs, the agency could amend the solicitation and solicit new proposals, rather than re-evaluating the existing proposals under the original criteria. AR Tab 111 at 1457.

The government is correct that a procuring agency’s decision to follow GAO’s recommendation is proper, even where that recommendation differs from the contracting officer’s initial decision, “unless [GAO’s] decision itself was irrational.” Centech Grp., Inc. v. United States, 554 F.3d 1029, 1039 (Fed. Cir. 2009) (quoting Honeywell, Inc., 870 F.2d at 648) (alteration in original); see also PricewaterhouseCoopers Pub. Sector, LLP v. United States, 126 Fed. Cl. 328, 352 (2016) (observing that “[g]enerally, an agency’s decision to take corrective action in order to implement a GAO recommendation is proper unless the GAO decision itself is irrational.” (citing Raytheon Co. v. United States, 809 F.3d 590, 595–96 (Fed. Cir. 2015) and Centech Grp., Inc., 554 F.3d at 1039)).

PSI does not claim, however, that GAO’s recommendation was itself irrational or otherwise improper. See Pl.’s Mot. at 22–26. It contends instead that FHWA did not, in fact, follow GAO’s recommendation when it amended the solicitation because there is nothing in the record to demonstrate that the agency ever made a determination that the original solicitation did not accurately reflect its needs. Id. at 30–34. Without such a determination, PSI argues, the corrective action was overbroad because, as a general matter, amending the solicitation and resoliciting new proposals is not an appropriate action to address an error in the evaluation process. See id. at 23–26 (citing Sheridan, 95 Fed. Cl. at 153 (holding that where an agency’s concern relates to how proposals were evaluated a re-solicitation of new proposals is not a rational corrective action)); see also Amazon Web Servs., Inc., 113 Fed. Cl. at 115–16.

PSI does not claim, however, that GAO’s recommendation was itself irrational or otherwise improper. See Pl.’s Mot. at 22–26. It contends instead that FHWA did not, in fact, follow GAO’s recommendation when it amended the solicitation because there is nothing in the record to demonstrate that the agency ever made a determination that the original solicitation did not accurately reflect its needs. Id. at 30–34. Without such a determination, PSI argues, the corrective action was overbroad because, as a general matter, amending the solicitation and resoliciting new proposals is not an appropriate action to address an error in the evaluation process. See id. at 23–26 (citing Sheridan, 95 Fed. Cl. at 153 (holding that where an agency’s concern relates to how proposals were evaluated a re-solicitation of new proposals is not a rational corrective action)); see also Amazon Web Servs., Inc., 113 Fed. Cl. at 115–16.

The Court agrees with PSI that the administrative record contains little, if any, evidence that FHWA conducted an assessment of its needs after GAO’s decision. Further, even assuming that such an assessment occurred, the record does not supply sufficient evidence that it was reasonable for FHWA to conclude that the original requirements it set for the PM position (in terms of both the duties and qualifications) did not accurately reflect its needs.

First, the administrative record provides no explanation of FHWA’s decision to change the PM’s duties and qualifications. The sole “explanation” of FHWA’s decision contained in the administrative record consists of two bullet points in the brief letter that FWHA sent to GAO after it decided to amend the solicitation rather than to re-evaluate the proposals of Genex and PSI under the existing solicitation. AR Tab 114 at 1470. In those two bullet points FHWA merely stated, without explanation, that it intended to 1) “amend[] the technical requirements for key personnel and . . . seek revised proposals from the two organizations that had submitted proposals under the solicitation” and 2) “evaluate the revised proposals and issue a source selection decision based upon that evaluation.” Id.

 This language establishes only that the agency made a decision to amend the technical requirements and to solicit and evaluate new proposals. But neither the letter to GAO nor any other document in the record reflects that the agency’s decision to take these steps was based on any assessment of whether the duties and experiential requirements set forth in the original solicitation for the PM position accurately reflected the agency’s needs. At most, one might infer that some assessment was conducted based on FHWA’s conclusory statement in the letter that it had reviewed GAO’s decision and believed that its corrective action was consistent with GAO’s recommendation. But that inference alone is an inadequate basis for upholding the corrective action given the lack of other evidence in the record regarding FHWA’s decision-making process.

Even assuming it is possible to infer that the agency evaluated whether reducing the PM’s responsibilities and watering down the management experience requirements would better reflect its needs, there is nothing in the record—contemporaneous or otherwise—from which the Court can determine how the decision was made or what rationale supports it. While the Court agrees with the government that the agency is not required to “synthesize its thinking . . . into a prelitigation written explanation of the rationale for each of the solicitation’s requirements,” Def.’s Mot. at 25 (omission in original) (quoting Savantage Fin. Servs., Inc. v. United States, 595 F.3d 1282, 1287 (Fed. Cir. 2010)), it disagrees that the rationale for the changes the agency made “is apparent from, and supported by, the administrative record.” Id.

(sections deleted)

In short, the record before the Court is devoid of evidence that the agency reviewed its needs, reasonably assessed them, and had a rational basis for deciding that the original solicitation did not meet them. Accordingly, FHWA’s decision to amend the solicitation to reduce the responsibilities and water down the experience and qualifications required for the PM position is arbitrary and capricious and must be set aside.  (Professional Service Industries, Inc. v U. S. and Genex Systems, LLC, No. 16-1038C. November 15, 2016)


On July 30, 2015, plaintiff filed this postaward bid protest challenging the contract award to Tech Systems, Inc. (“TSI” or “defendant-intervenor”) under a solicitation issued by the United States, acting through the United States Army Contracting Command (“Army”) in Rock Island, Illinois. The solicitation was issued to acquire logistics support services at Schofield Barracks, Hawaii. The parties filed cross-motions for judgment on the administrative record, and oral argument was held on October 22, 2015. Subsequently, on November 9, 2015, the parties filed a joint status report, and then on November 12, 12, 2015, defendant filed a notice indicating that the Army elected to take corrective action. Specifically, defendant stated that the Army will

(1) terminat[e] for convenience the award to TSI;
(2) amend[] the request for proposals (RFP) to reflect a change in conditions that has occurred since the last amendment to the RFP, and clarify[] § L.5.4.2.7.5(d) of the RFP, which sets forth the requirements governing the capping of an offeror’s indirect rates;
(3) reopen[] discussions and request[] full revised technical and cost proposals from the final six offerors;
(4) require[e] offerors and their subcontractors to confirm that their indirect rates are capped, or to verify their understanding that the Army will cap their indirect rates at those listed in their proposals, if meeting the conditions in § L.5.4.2.7.5(d) of the RFP;
(5) conduct[] a new cost realism analysis of the offerors and their subcontractors; and
(6) mak[e] a new best value determination and award[] the contract accordingly.
Def.’s Notice 1-2.

Def.’s Notice 1-2.

In light of its decision to take corrective action, defendant argues that this protest is moot and moves to dismiss for lack of subject matter jurisdiction pursuant to Rule 12(b)(1) of the Rules of the United States Court of Federal Claims (“Court of Federal Claims”). Plaintiff’s response to defendant’s motion advises that “[w]hile Dellew does not oppose the Government’s request that the Court dismiss Dellew’s complaint pursuant to RCFC 12(b)(1) in principle, Dellew disagrees with the Government’s position that such a dismissal precludes Dellew’s recovery of reasonable attorney’s fees and litigation expenses pursuant to the [Equal Access to Justice Act].” Pl.’s Mot. 2. In addition, defendant-intervenor’s response asserts that the proposed corrective action “is much wider and expansive than that which would be required to address” the issues raised by plaintiff. Def.-Int.’s Mot. 2. According to defendant-intervenor, “[t]he changes outlined by the United States . . . can easily be changed by altering the scope of the work post-award[, which] would allow the awardee to start performance much more quickly.” Id.

As of the date of this order, defendant has not completed its corrective action: consequently, there is no viable protest before the court. In the absence of an actual controversy, the court grants defendant’s motion on mootness grounds. As explained above, plaintiff acknowledges that the corrective action renders its claims moot. “[A] case is moot when the issues presented are no longer ‘live’ or the parties lack a legally cognizable interest in the outcome.” Powell v. McCormack, 395 U.S. 486, 496 (1969). A court “will determine only actual matters in controversy essential to the decision of the particular case before it.” United States v. Alaska S.S. Co., 253 U.S. 113, 115 (1920). “The controversy must be definite and concrete, touching the legal relations of parties having adverse legal interests.” Aetna Life Ins. Co. of Hartford, Conn. v. Haworth, 300 U.S. 227, 240-41 (1937). Moreover, the controversy must exist at all stages of the litigation; it is not enough that the controversy was alive when the complaint was filed. Steffel v. Thompson, 415 U.S. 452, 459 n.10 (1974). Subsequent acts will render a case moot if they make it impossible for the court to grant “‘effectual relief.’” Church of Scientology of Cal. v. United States, 506 U.S. 9, 12 (1992) (quoting Mills v. Green, 159 U.S. 651, 653 (1895)). However, a case will not be considered moot by subsequent acts if some of the requested relief remains available. Intrepid v. Pollock, 907 F.2d 1125, 1131 (Fed. Cir. 1990); accord Church of Scientology of Cal., 506 U.S. at 12 (holding that a case is not moot so long as the “court can fashion some form of meaningful relief” for the injured party).

In this protest, the subsequent act invoked by defendant is the Army’s decision to take corrective action. “A defendant’s voluntary cessation of allegedly unlawful conduct ordinarily does not suffice to moot a case.” Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 174 (2000). However, the voluntary cessation of the challenged activity may render a case moot if there is no reasonable expectation that the activity will recur and the effects of the activity have been completely extinguished. Cnty. of L.A. v. Davis, 440 U.S. 625, 631 (1979). Thus, when “corrective action adequately addresse[s] the effects of the challenged action, and the Court of Federal Claims ha[s] no reasonable expectation that the action would recur,” the case should be dismissed. Chapman Law Firm v. Greenleaf Constr. Co., 490 F.3d 934, 940 (Fed. Cir. 2007). The party asserting mootness bears a heavy burden of establishing that the challenged activity will not recur. Friends of the Earth, Inc., 528 U.S. at 189. In this case, defendant has met that burden because it will amend the solicitation and accept revised proposals. Not only does plaintiff agree that the challenged activity is unlikely to occur, but also, defendant-intervenor admits that the proposed corrective action “address[es] the issues raised by” plaintiff. Def.-Int.’s Mot. 2.

Although defendant-intervenor contends that the corrective action is too expansive in scope, the court is unpersuaded by this argument. In its complaint and motion for judgment on the administrative record, plaintiff asserted that the Army erroneously awarded the contract to an offeror that was technically unacceptable. The Army’s decision to take the corrective action described above is therefore reasonable. After oral argument, “the Army examined whether a change in conditions occurred at Schofield Barracks, Hawai’i[] since the last amendment to the request for proposals . . . .” Declaration of Amy J. Hayden ¶ 2. Specifically,

The Army determined that, since the RFP was last amended, the following changes in condition occurred: (1) the supply total decreased by 19.10%, which included eliminating the pre-deployment training and equipment (PDTE) requirement; (2) the maintenance total increased by 11.63%, which included adding a new requirement for container repair; (3) the transportation total increased by 6.67%. The Army determined that these changes resulted in a net decrease in contract effort totaling 5.32% over the base year, and by the same estimated amount for the four option years of the contract.

Id. ¶ 3. Because “a change in conditions occurred,” resulting in a “net decrease in contract value of 5.32%,” it is reasonable for the Army to amend the solicitation. Def.’s Reply 9. Indeed, Federal Acquisition Regulation (“FAR”) 15.206(a) requires that “[w]hen, either before or after receipt of proposals, the Government changes its requirements or terms and conditions, the contracting officer shall amend the solicitation.” Consequently, amending the solicitation to reflect these altered conditions is not only reasonable, but warranted. An amended solicitation necessarily requires requesting revised proposals and conducting a new cost realism analysis and best value determination—actions defendant plans to undertake. Defendant-intervenor argues that the proposed corrective action is too wide, but does not provide any details or analysis as to why, nor explains how altering the scope of the work post-award, as it proposes, would properly address the net decrease in contract value. Bald assertions are insufficient to justify further involvement by this court. Thus, for the reasons set forth above, the court finds that defendant’s proposed corrective action is rationally related to the challenge raised by plaintiff and the altered procurement conditions described by defendant.  (Dellew Corporation v. U. S. and Tech Systems, Inc., No. 15-808C, January 20, 2016)  (pdf)


1. The Army’s Reliance on the GAO Attorney’s April 20, 2011 Electronic-Mail Message Renders Its Decision to Take Corrective Action Irrational

The first protest ground asserted by plaintiff–that the Army’s decision to take corrective action is arbitrary, capricious, and unreasonable because the decision is based on an electronicmail message from a GAO attorney that is itself unreasonable–raises two threshold issues: was the Army’s decision to take corrective action premised on the GAO attorney’s April 20, 2011 electronic-mail message and, to the extent that it was, is the court empowered to review the electronic-mail message for rationality in the same way it can review a formal decision by the GAO recommending corrective action?

To answer the first question, the court looks to the timeline of events reflected in the administrative record. Kratos lodged its supplemental protest on April 4, 2011. On April 7, 2011, the GAO attorney informed the parties that in light of the supplemental protest, he was interested in whether the Army would continue to oppose the protest or take corrective action. Then, on April 11, 2011, the GAO attorney invited the Army to respond to comments made by Kratos about its initial protest, but specifically requested that the Army not respond to Kratos’s supplemental protest. The Army complied with the request; its response did not address Kratos’s supplemental protest. On April 20, 2011, in the electronic-mail message at issue, the GAO attorney conveyed his impressions of Kratos’s supplemental protest. In a response sent that same day, the Army indicated that it understood the GAO attorney’s position. Then, on April 22, 2011, the Army informed the GAO and the other parties that, after reviewing the supplemental protest, it had decided to take corrective action. The Army’s April 22, 2011 letter constituted its first formal response to Kratos’s supplemental protest.

The timeline suggests two possible scenarios. One possibility is that the Army had been considering how to respond to the supplemental protest for more than two weeks, i.e., from the time that it was first advanced by Kratos, and that its April 22, 2011 letter was the culmination of its deliberations. The fact that the Army did not address the merits of the supplemental protest before April 22, 2011, supports this scenario, as does the Army’s failure to mention the GAO attorney’s electronic-mail message in its letter. The other possibility is that the position taken by the Army in its April 22, 2011 letter was prompted by the GAO attorney’s April 20, 2011 electronic-mail message. The brief period of time—two days—between the message and the letter supports this scenario. Given the ambiguity regarding the true basis of the Army’s decision to take corrective action, the court finds it reasonable to assume that the decision was based, at least in part, on the GAO attorney’s April 20, 2011 electronic-mail message.

Assuming that the Army based its decision to take corrective action on the impressions conveyed by the GAO attorney in his electronic-mail message, the court must next determine whether it can review the message in the same way it reviews a formal GAO decision recommending corrective action. This appears to be an issue of first impression.

There is no question that a court, in deciding the propriety of a procuring agency’s implementation of corrective action recommended by the GAO, may review whether the GAO’s recommendation was itself rational. See Honeywell, Inc. v. United States, 870 F.2d 644, 648 (Fed. Cir. 1989) (“[A] procurement agency’s decision to follow the Comptroller General’s recommendation, even though that recommendation differed from the contracting officer’s initial decision, was proper unless the Comptroller General’s decision itself was irrational.”); Centech Grp., Inc., 79 Fed. Cl. at 563 n.2 (“[I]t is appropriate for this Court to consider the rationality of GAO’s determination where the agency relied upon such determination in taking the corrective action at issue.”). The decisional law reflects, however, that as a general rule, courts have reviewed GAO recommendations only when they were included as part of a formal GAO decision. See John Reiner & Co. v. United States, 325 F.2d 438, 442 (Ct. Cl. 1963) (“[I]t is the usual policy, if not the obligation, of the procuring departments to accommodate themselves to positions formally taken by the [GAO] with respect to competitive bidding.” (emphasis added)); see also Interstate Rock Prods., Inc. v. United States, 50 Fed. Cl. 349, 363 (2001) (citing Honeywell for the proposition that “to the extent that an agency chooses to follow the advice of the GAO, courts should only intervene if the advice the agency receives is ‘irrational,’” and concluding that the prior GAO decisions relied upon by the procuring agency in rejecting a bid as unresponsive were “eminently rational”); see also ManTech Telecomms. & Info. Sys. Corp., 49 Fed. Cl. at 62, 73-80 (analyzing, in a case where the procuring agency’s proposed corrective action was based on the GAO’s suggestion during the alternative dispute resolution process that it would sustain the protest before it, only whether the proposed corrective action was reasonable, and not whether the GAO’s suggestion was rational).

In the present case, there is no formal GAO decision sustaining Kratos’s protest and recommending corrective action. Rather, there are only the informal and nonfinal impressions of the GAO attorney, expressed in an electronic-mail message, indicating that the GAO would likely sustain Kratos’s supplemental protest. Nevertheless, the court has a broad mandate to entertain bid protests and review government procurement decisions. If a procuring agency takes an action that is challenged in this court, this court has the responsibility to examine the basis for the agency’s action, regardless of what that basis might be. In other words, when determining the propriety of a procuring agency’s decision to take corrective action, the court may review the rationality of, as appropriate, the underlying formal GAO decision containing a recommendation that the agency take such action or the underlying informal suggestion by the GAO, or any other entity or individual, that such action might be proper. Thus, the court concludes that because the Army relied upon the GAO attorney’s electronic-mail message in deciding to take corrective action, and only because the Army relied upon the message, it may review the message to determine whether it was rational.

The threshold issues thus resolved, the court turns to the substance of the GAO attorney’s electronic-mail message. In his message, the GAO attorney reaches two conclusions. First, he opines that the GAO “need not resolve the issue of whether . . . the protester timely challenged” the Army’s evaluation of proposals. Second, he indicates that the GAO would likely sustain Kratos’s protest due to deficiencies in the source selection decision. Both of these conclusions are irrational.

The GAO is empowered to entertain protests “concerning an alleged violation of a procurement statute or regulation” so long as the protests are filed in accordance with the governing statutes. 31 U.S.C. § 3552(a) (2006). These statutes require the GAO to establish procedures for the “expeditious” resolution of the protests. Id. § 3555(a). Under this authority, the GAO adopted a regulation providing that the GAO “shall” dismiss a protest that is not timely filed, 4 C.F.R. § 21.5(e) (2011), unless it determines that the protest “raises issues significant to the procurement system” or finds that “good cause” exists to consider the protest, id. § 21.2(c). In other words, except under limited circumstances, the GAO may not entertain untimely protests because they are not filed in accordance with the governing statutes. The GAO’s own decisions support this conclusion. See, e.g., Patricia A. Thompson-Agency Tender Official, B-310910.4, 2009 CPD ¶ 24 (Comp. Gen. Jan. 22, 2009) (“Our Bid Protest Regulations contain strict rules requiring timely submission of protests. . . . [T]he protest is untimely and, therefore, must be dismissed.”); Goel Servs., Inc., B-310822.2, 2008 CPD ¶ 99 (Comp. Gen. May 23, 2008) (“Our timeliness rules reflect the dual requirements of giving parties a fair opportunity to present their cases and resolving protests expeditiously without unduly disrupting or delaying the procurement process. In order to prevent these rules from becoming meaningless, exceptions are strictly construed and rarely used. The ‘good cause’ exception is limited to circumstances where some compelling reason beyond the protester’s control prevents the protester from filing a timely protest. The significant issue exception is limited to untimely protests that raise issues of widespread interest to the procurement community, and which have not been considered on the merits in a prior decision.” (citations omitted)); Cornet, Inc., B-270330 et al., 96-1 CPD ¶ 189 (Comp. Gen. Feb. 28, 1996) (noting that the protest regulations require the dismissal of untimely protests and dismissing supplemental protest grounds as untimely).

Here, the GAO attorney asserted that the GAO “need not” consider the timeliness of Kratos’s supplemental protest, and, although the court cannot completely discount the possibility that the GAO attorney was impliedly invoking one of the exceptions allowing the GAO to consider an untimely protest, there is no indication in the electronic-mail message that an exception to the timeliness rule applied. Thus, the GAO attorney’s statement that the timeliness of Kratos’s protest was irrelevant clearly contravenes the statutory mandate that the GAO not entertain untimely protests. When the GAO acts in violation of the law, the act lacks a rational basis. See SP Sys., Inc. v. United States, 86 Fed. Cl. 1, 13 (2009) (“If the GAO recommendation is . . . plainly contrary to a statutory requirement, that decision is irrational and an agency action is not justifiably based upon it.” (citing Grunley Walsh Int’l, LLC v. United States, 78 Fed. Cl. 35, 44 (2007))); Cal. Marine Cleaning, Inc., 42 Fed. Cl. at 295-96 (holding that the GAO’s misapplication of late bid rule set forth in the FAR was irrational, and therefore the agency’s reliance on the GAO’s decision was improper); see also United States v. Amdahl Corp., 786 F.2d 387, 392-93 (Fed. Cir. 1986) (“Administrative actions taken in violation of statutory authorization or requirement are of no effect.”). The GAO attorney’s statement on timeliness is therefore irrational.

The GAO attorney’s analysis of the Army’s evaluation of proposals suffers the same fate. In the Source Selection Decision Memorandum, the Source Selection Authority reported the findings from the Army’s evaluation and concluded that there were “no meaningful distinctions” among the noncost elements of the proposals. AR 2013. The Source Selection Authority acknowledged, however, that the proposals submitted by Kratos and SA-TECH were not identical: “[T]he main difference between the two offerors is that, as the incumbent, Kratos/WSS has the personnel with the specific TMO experience in their current employment and has proposed these employees for the follow-on ATFS requirement.” Id. at 2014. She then explained how SA-TECH’s proposal mitigated those differences.

[. . .]

Id. In other words, she most assuredly compared the ability of Kratos, as the incumbent contractor, to supply personnel with specific experience with SA-TECH’s proposal to supply personnel with general experience coupled with a plan to mitigate its failure to propose personnel with specific experience. She then concluded that the “price/cost advantages of SA-TECH’s proposal outweigh[ed] the possibility of a learning curve impact.” Id. at 2013. It is readily apparent that the Source Selection Authority, upon comparing the proposals of Kratos and SATECH, clearly determined that the two proposals were not meaningfully distinct in the area of personnel experience and concluded that the benefit to the Army of SA-TECH’s lower price was worth the possibility that some of SA-TECH’s employees would lack specific experience. Her conclusion is entitled to deference.20 See Lockheed Missiles & Space Co. v. Bentsen, 4 F.3d 955, 958-59 (Fed. Cir. 1993) (“Effective contracting demands broad discretion. Accordingly, agencies ‘are entrusted with a good deal of discretion in determining which bid is the most advantageous to the Government.’” (citations omitted) (quoting Tidewater Mgmt. Servs., Inc. v. United States, 573 F.2d 65, 73 (Ct. Cl. 1978))); Gen. Offshore Corp., B-251969 et al., 94-1 CPD ¶ 248 (Comp. Gen. Apr. 8, 1994) (“Where an evaluation is challenged, we will examine the agency’s evaluation to ensure that it was reasonable and consistent with the evaluation criteria and applicable statutes and regulations, since the relative merit of competing proposals is primarily a matter of administrative discretion.”), quoted in E.W. Bliss Co. v. United States, 77 F.3d 445, 449 (Fed. Cir. 1996).

The GAO attorney did not afford the proper deference to the Army’s source selection decision. In fact, his electronic-mail message demonstrates that he completely misread the decision. He wrote:

The source selection fails to acknowledge and appreciate the concerns expressed in the evaluation of the Labor element, which serves as a key discriminator between the proposals. That the two proposals were rated the same for this element is highly irrelevant; regardless of ratings, the source selection must look behind those ratings to consider the distinctions uncovered in the evaluation. This source selection document fails to do that.

Had the agency said, we recognize the value of incumbency and the advantage of the reduced risk in the incumbent’s proposal, but that advantage is not worth the premium over the awardee’s proposal, we would in all likelihood deny a challenge to the best value trade-off. Those are not the facts here. Here, the agency denied that there were proposal discriminators–documented in its evaluation–and there was a trade-off to be made between, on the one hand, an incumbent who guaranteed to deliver an experienced work force, and, on the other, a lower-priced offeror who did not and about whom the agency expressed reservations.

AR 1995. First, contrary to the GAO attorney’s observations, the Source Selection Authority did “acknowledge and appreciate the concerns” of the Technical Evaluation Committee regarding the experience of SA-TECH’s proposed workforce; she set forth those concerns in her decision and explained that SA-TECH had sufficiently mitigated those concerns. The Source Selection Authority also “look[ed] behind [the] ratings to consider the distinctions” identified by the Technical Evaluation Committee; she both described the distinctions and explained why those distinctions were not meaningful. Third, despite the GAO attorney’s representations, the Source Selection Authority “recognize[d] the value of incumbency” and concluded that the value of incumbency was not worth the price premium–in the Source Selection Decision Memorandum she acknowledged that Kratos, as the incumbent contractor, had personnel with specific experience and explained that the cost advantage of SA-TECH’s proposal outweighed the lack of specific experience of its proposed personnel. Fourth, the Source Selection Authority acknowledged the distinctions between the proposals of Kratos and SA-TECH, finding them not to be meaningful; she did not, as the GAO attorney stated, “den[y] that there were proposal discriminators[.]” Finally, contrary to the GAO attorney’s assertion, the Source Selection Authority described both a tradeoff between Kratos’s incumbency and SA-TECH’s mitigation efforts and a tradeoff between the proposed prices and the relative experience levels of the proposed personnel. All of these errors suggest that instead of applying the necessary amount of deference, the GAO attorney was substituting his judgment for that of the Army. He may not do so. Turner Constr. Co., 2011 WL 2714137, at *5 (“When an officer’s decision is reasonable, neither a court nor the GAO may substitute its judgment for that of the agency.”). Accordingly, his analysis of the source selection decision is irrational.

Because the GAO attorney improperly declared that the timeliness of Kratos’s protest was irrelevant and completely misconstrued the Source Selection Decision Memorandum, the contents of the GAO attorney’s April 20, 2011 electronic-mail message are irrational. As a result, to the extent that the Army’s decision to take corrective action is based upon the message, it lacks a rational basis and is therefore arbitrary, capricious, and an abuse of discretion.  (Systems Application & Technologies, Inc. v. U. S. and Madison Research Corporation, No. 11-280C, August 25, 2011)  (pdf)


II. The Agency’s Planned Corrective Action is Unlawful and Irrational.

The Court now turns to whether the agency’s proposed corrective action was improper or otherwise contrary to law. The Court’s limited review of agency decisions is set forth in the Administrative Procedures Act (“APA”). 5 U.S.C. § 706(2)(A). The APA provides that an agency decision may be set aside only if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2)(A) (incorporated by reference in 28 U.S.C. § 1491(b)(4)); Bannum, Inc. v. United States, 404 F.3d 1346, 1351 (Fed. Cir. 2005). Therefore, an agency’s procurement decision may be set aside if it lacked a rational basis or involved a violation of statute or regulation. Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1332 (Fed. Cir. 2001). This standard of review is highly deferential to the agency’s decision. Advanced Data Concepts, Inc. v. United States, 216 F.3d 1054, 1057-58 (Fed. Cir. 2000).

In applying this standard to an agency’s corrective action, contracting officers are provided “broad discretion to take corrective action where the agency determines that such action is necessary to ensure fair and impartial competition.” DGS Contract Serv., Inc. v. United States, 43 Fed. Cl. 227, 238 (1999) (quoting Rockville Mailing Serv., Inc., B-270161.2, 96-1 CPD ¶ 184 (Comp. Gen. Apr. 10, 1996)). Nevertheless, the chosen corrective action must be “reasonable under the circumstances.” Id. To be reasonable, the agency’s corrective action must be rationally related to the defect to be corrected. MCII Generator & Elec., 2002 WL 32126244. Furthermore, the reason for the corrective action must be supported by the evidence in the record. Id.

Despite the wide latitude afforded to an agency’s corrective action, the Court finds the evidence lacking in this case. The record is devoid of any justification for the agency’s decision to solicit revised proposals. Defendant asserts that corrective action was necessary to address defects in the procurement raised by JCN in its bid protest. Specifically, Defendant contends that, because of an incorrectly established competitive range, the agency improperly provided Sheridan with disparate treatment. Although the Court will analyze the appropriateness of the corrective action, the issue of whether Sheridan received any disparate treatment is not currently before the Court and will not be addressed in this Opinion.

Defendant contends that the corrective action is necessary because the contracting officer committed an error by not establishing “a competitive range comprised of all of the most highly rated proposals” as required by FAR 15.306(c)(1). Defendant alleges that this error occurred because the contracting officer, in setting the competitive range, incorrectly attributed to Sheridan a past performance rating of “very low risk,” instead of the actual assigned factor of “low risk.” In making this assertion, Defendant cites the April 20, 2010 Memorandum for the Record – Analysis of Proposal Summary, which states “[o]n 12 Mar 10 a Competitive Range was established which consisted of all offerors that were considered to have reasonable and realistic pricing, and received a rating of Very Low Risk.” (AR 519.) Defendant suggests that, had the contracting officer correctly evaluated Sheridan’s risk factor in setting the competitive range, the range would have consisted of the top three offerors instead of only Sheridan. Defendant’s argument is flawed for two reasons: (1) the competitive range was an unnecessary procedural step; and (2) it is unclear from the record that the agency evaluated Sheridan’s past performance risk rating incorrectly.

First, the competitive range described in FAR 15.306(c)(1) is inapplicable where, as here, the agency awards the contract without conducting any offeror discussions. The only error in this case was the agency’s use of the term “competitive range” in the first place. Defendant cites the second sentence of FAR 15.306(c)(1) for the proposition that the competitive range should have consisted of more than just one proposal. The second sentence of FAR 15.306(c)(1) states: “the contracting officer shall establish a competitive range comprised of all of the most highly rated proposals . . . .” However, Defendant consistently ignores the first sentence of FAR 15.306(c)(1) which provides: “[a]gencies shall evaluate all proposals in accordance with 15.305(a), and, if discussions are to be conducted, establish the competitive range.” (emphasis added). The first sentence of FAR 15.306(c)(1) instructs on when to create a competitive range, and the second sentence instructs on how to establish a competitive range.

In this case, the agency did not conduct any discussions with offerors, and stated in the RFP that it did not intend to conduct discussions. (AR 78.) Because of the lack of any discussions with offerors, the agency should not have created a competitive range and should have simply awarded the contract to the highest rated proposal. The concept of a competitive range in this case was entirely meaningless and unnecessary. Accordingly, because the concept of a competitive range was inapplicable to this solicitation, any issue relating to the size of the competitive range was not a defect in need of correction, but simply an unnecessary step that the agency should have ignored in the first place.

Second, Defendant cites an error that caused the contracting officer to limit the “competitive range” only to Sheridan. Allegedly, the contracting officer incorrectly believed that Sheridan was the only proposal to receive a “very low risk” rating. The administrative record at best is ambiguous on whether this error actually occurred as Defendant suggests. Defendant asserts that this error is based on a statement in the agency’s April 20, 2010 memorandum summarizing the procurement that Sheridan was assessed as “very low risk.” (AR 519.) However, it is impossible to conclude that the addition of the word “very” in the April 20, 2010 memorandum was not simply the result of a typographical error or an improper recollection. The record suggests that, at the time the agency selected Sheridan as the best value proposal, it had evaluated Sheridan’s proposal as “low risk.” The Source Selection Document, dated March 19, 2010, states that “the proposal presented by The Sheridan Corporation, which revealed the highest rated Past Performance assessment of all offerors and the only Low-Risk offeror assessed, combined with the second lowest price provides the best overall value to the Government.” (AR 516.) Defendant thus cites a memorandum written over a month after source selection as proof that somehow the agency incorrectly evaluated Sheridan as “very low risk.” The Court, however, finds the contemporaneous statements from the Source Selection Document to be the more persuasive evidence of the agency’s evaluation of Sheridan’s proposal.

A careful review of the administrative record does not reveal any errors that required corrective action. Even if the Court accepts JCN’s assertion that Sheridan received disparate treatment requiring corrective action, the chosen corrective action to resolicit proposals was improper. Defendant has never suggested that Sheridan did not submit the best proposal. Defendant’s counsel has agreed that the actual proposals received by the agency had no flaws. (Oral Arg., Oct. 13, 2010, Tr. 20.) The only potential error acknowledged by the agency is in the evaluation of the proposals. Although the APA grants the Government wide latitude in its decision-making process, this Court has rejected corrective action to resolicit proposals because of a perceived evaluation error. See, e.g., Delaney Constr. Corp., 56 Fed. Cl. at 476; MCII Generator & Elec., 2002 WL 32126244. Simply put, the corrective action must target the identified defect. Here, the agency’s concern related to the evaluation of the proposals. Any corrective action should have been targeted to that issue. Resoliciting new proposals was not a rational corrective action.

The Court finds the circumstances here analogous to Delaney. 56 Fed. Cl. 470. In that case, Delaney, a self-certified small business, submitted the lowest priced, technically acceptable offer. Id. at 472. Tug Hill, a self-certified HUBZone small business contractor, submitted the second lowest priced, technically acceptable proposal. Id. During the debriefing following the agency’s decision to award the contract to Delaney, the agency informed Tug Hill that the agency initially considered applying a ten percent HUBZone price preference required by 15 U.S.C. § 657a to Tug Hill’s price, which would have made Tug Hill’s bid the lowest technically acceptable offeror. However, the agency determined that the preference did not apply when a HUBZone small business competed against another small business, and therefore, the agency awarded the contract to Delaney. Id. Tug Hill initiated a size protest contending that Delaney did not meet the required small business size standards. Id. Shortly thereafter, Delaney notified the contracting officer that it had failed to consider revenues from affiliated companies, and conceded that it no longer met the small business standards. Id. at 473.

Following an unsuccessful agency level protest, Tug Hill submitted a protest to the GAO. Id. Ten days later, the agency requested GAO to dismiss the protest because it intended to take corrective action. Id. As part of the corrective action, the agency elected to reopen the competition and insert a clause regarding the HUBZone ten percent preference. Id. Both Delaney and Tug Hill objected to the proposed corrective action to reopen the competition. Id. at 473-74. The Court held that, because the prices had been disclosed,7 the proposed corrective action to obtain new price proposals “would comprise arbitrary action.” Id. at 476. The Court explained that “[n]o public interest purpose has been established which would support trashing the disclosed proposed prices, obtained on the basis of full and open competition, in favor of obtaining new prices as a result of adding a contract clause which only provides notice of a statutory requirement that existed at all relevant times.” Id.

Similarly, in MCII Generator & Electric, an unsuccessful offeror filed a bid protest with the GAO alleging that the Army had improperly evaluated its price and the awardee’s risk in making its selection. 2002 WL 32126244. The Army proposed to take corrective action by resoliciting proposals. Id. The awardee brought suit seeking injunctive relief to stop the resolicitation because the proposed corrective action lacked a rational connection to any identified defect. Id. The Court in MCII Generator struggled, as this Court does here, to find any defect in the initial procurement selection, let alone a defect that warranted reopening the competition. Id. The Court enjoined the Army’s proposed corrective action finding that “the integrity of the procurement system requires that award decisions not be overturned for no reason or for insubstantial reason.” Id.

The Court finds the MCII Generator case particularly relevant to the present case. In both situations, the “defect” identified by the Government had no relation to the proposed corrective action. The record in both cases suggests that the respective agencies made the correct award decisions, and that if any flaws in the process existed, such flaws occurred during the evaluation of the properly submitted proposals. In such circumstances, a reevaluation of the proposals may be warranted, but a resolicitation of the proposals compromises the integrity of the procurement system, especially where the winning price has been disclosed to the public.

Defendant argues that this case can be distinguished from Delaney, MCII Generator, and other cases because here, the resolicitation is on identical terms. The Court finds this position entirely illogical. Instead, the fact that the agency conducted the resolicitation on identical terms further strengthens Plaintiff’s argument that a resolicitation was improper and unnecessary. Where the terms of the RFP remain unchanged and the initial proposals were properly submitted, there is no rational basis for the agency to resolicit proposals that it already received under a properly conducted solicitation. The only conceivable reason to permit resolicitation would be to allow the unsuccessful offerors an opportunity to beat the now disclosed price of the winning proposal. Such a result is impermissible and would severely damage the integrity of the procurement process.

Finally, Defendant argues that, because of the passage of time in this case, a resolicitation is necessary to ensure that all the proposals are accurate and up-to-date. This argument is unsupported by the administrative record and was raised for the first time during oral argument. See Oral Arg., Oct. 13, 2010, Tr. 25. Any issues resulting from the passage of time were of the Government’s own creation and cannot support the agency’s attempt to resolicit proposals. Furthermore, there are mechanisms in the RFP to adjust the price as necessary to take into account fluctuations in the price of materials as a result of the delay. Therefore, the Court concludes that the proposed corrective action of resoliciting proposals lacks a rational basis and is not supported by the administrative record.  (The Sheridan Corporation v. U. S. and JCN Construction Company, Inc., 10-547C, November 5, 2010)  (pdf)


3. Was GAO’s Corrective Action Reasonable and Lawful?

Having decided that corrective action was necessary, the court must now consider whether the corrective actions GAO took were reasonable and lawful. Following the “outcome prediction” in which the PLCG1 informed GAO that it intended to sustain plaintiff’s protest with regard to the indemnification clause, GAO reopened the solicitation and requested another round of FPRs. AR 1777–81, 1917, 1921. GAO permitted the offerors unlimited discretion in revising their price proposals, but did not allow them to change their technical proposals. In addition, GAO forced Monster to either remove the unacceptable indemnification clause or face elimination. AR 1918, 1922. GAO’s stated purpose in taking these corrective actions was “to eliminate the indemnification provision in Monster’s proposal and allow the offerors to compete on price alone.” AR 1779.

Plaintiff asserts in its complaint that “[w]hen a negotiated procurement is reopened by an agency for revised offers, it must allow any revision to those offers the offeror may care to make.” Compl. ¶ 26. For this proposition, plaintiff cites FAR 15.206 and FAR 15.307 without any preceding signal. However, these citations do not support plaintiff’s proposition either directly or indirectly. FAR 15.206, titled “Amending the [S]olicitation,” outlines when a contracting officer may amend a solicitation and how such an amendment is issued. FAR 15.307, titled “Proposal [R]evisions,” provides:

(a) If an offeror’s proposal is eliminated or otherwise removed from the competitive range, no further revisions to that offeror’s proposal shall be accepted or considered.

(b) The contracting officer may request or allow proposal revisions to clarify and document understandings reached during negotiations. At the conclusion of discussions, each offeror still in the competitive range shall be given an opportunity to submit a final proposal revision. The contracting officer is required to establish a common cut-off date only for receipt of final proposal revisions. Requests for final proposal revisions shall advise offerors that the final proposal revisions shall be in writing and that the Government intends to make award without obtaining further revisions.

The court finds nothing in these regulations to support plaintiff’s cited proposition. Indeed, this court has recognized that subsequent to an “outcome prediction,” an agency may re-open a solicitation and allow offerors to make only limited revisions to their proposals. See Consol. Eng’g Servs., Inc. v. United States, 64 Fed. Cl. 617, 627–29 (2005) (“[T]he agency’s decision to expand the scope of the corrective action to permit revisions to key personnel and subcontractors was reasonable, as was its decision to limit revisions to those aforementioned areas.”).

This ability to limit proposal revisions derives, in part, from contracting officials’ “broad discretion to take corrective action where the agency determines that such action is necessary to ensure fair and impartial competition.” DGS Contract Serv., Inc. v. United States, 43 Fed. Cl. 227, 238 (1999) (quoting Rockville Mailing Serv., Inc., B-270161.2, Apr. 10, 1996, 96-1 CPD ¶ 184 at *4); see also FAR 1.602-2(b) (“Contracting officers shall [e]nsure that contractors receive impartial, fair, and equitable treatment.”). Here, GAO’s corrective action was aimed at ensuring fair and impartial treatment for both plaintiff and Monster. Plaintiff was assured that its competitor would not be advantaged via an unlawful indemnification clause, while Monster was granted the same meaningful discussions that plaintiff enjoyed.

Moreover, this approach recognizes the agency’s interest in preserving its resources and the resources of the parties. Thus, the agency may salvage those portions of the procurement untainted by the problems identified in the protest. See Serv-Air, Inc., B-258243, et al., March 3, 1995, 95-1 CPD ¶ 125 at *2 (holding that agency may take corrective action by limiting offerors’ proposal revisions to cost proposals where PLCG’s prior decision found nothing improper in the agency’s previous evaluation of technical proposals). The only problem that the PLCG recognized in the procurement was the indemnification clause in Monster’s initial FPR. AR 1777–81. Despite plaintiff’s assertions to the contrary, GAO should not be required to scrap its previously upheld technical evaluations, nor should the parties be required to resubmit technical proposals, when a more limited corrective action will remedy the impropriety. Every problem identified in a procurement does not necessitate an entirely new competition. See id.

According to plaintiff, GAO’s corrective action was unfair because Monster’s indemnification clause was a “non-pricing term,” and thus, “Monster was allowed to alter both price and non-price factors while [plaintiff] was limited to price-only changes.” Pl.’s Am. Mem. 33–34; Pl.’s Reply 25–28. However, plaintiff’s counsel appeared to abandon this position at oral argument where he stated, “[W]e would also add that the indemnification clause has a cost aspect to it.” Tr. 75. Regardless of whether the indemnification clause is a pricing term or not, GAO explained in its proposed corrective action that it would permit Monster to remove the indemnification clause. AR 1779. Indeed, the whole purpose of the corrective action was to resolve the indemnification clause problem, thus, it is irrelevant how the clause is characterized. AR 1779. When GAO allowed Monster to remove the indemnification clause, it was simply acting in conformity with the corrective action plan as proposed to the PLCG.

(sections deleted)

After reviewing the record, the court finds that plaintiff enjoyed meaningful discussions prior to the submission of initial FPRs, while Monster did not. Thus, GAO’s corrective action—allowing Monster to remove the offending indemnification clause while limiting any other revisions to price only—was a reasonable and lawful means of ensuring fair and impartial treatment for both competitors.20 This corrective action provided Monster with the benefit of meaningful discussions and remedied the impropriety identified by the PLCG.  (Carahsoft Technology Corporation, v. U. S. and Monster Government Solutions, No 08-646C, Reissued February 12, 2009)

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1 This is GAO's Procurement Law Contracting Group.

U. S. Court of Federal Claims - Listing of Decisions

For the Government For the Protester
New Jacobs Technology Inc. v. U. S. and TRAX International Corporation; TRAX International Corporation v. U. S. and Jacobs Technology Inc., Nos. 16-1602C & 17-88C, April 7, 2017 Professional Service Industries, Inc. v U. S. and Genex Systems, LLC, No. 16-1038C. November 15, 2016
Dellew Corporation v. U. S. and Tech Systems, Inc., No. 15-808C, January 20, 2016  (pdf) Systems Application & Technologies, Inc. v. U. S. and Madison Research Corporation, No. 11-280C, August 25, 2011  (pdf)
Carahsoft Technology Corporation, v. U. S. and Monster Government Solutions, No 08-646C, Reissued February 12, 2009  (pdf) The Sheridan Corporation v. U. S. and JCN Construction Company, Inc., 10-547C, November 5, 2010  (pdf)
Omega World Travel, Inc. v. The U. S., No. 02, 1199C, November 26, 2002  (pdf)  
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