Corrective Action Terminating Contract Was Irrational

A protest of the government’s decision to take corrective action terminating the contract award and reopening the competition for aerial target flight operations and maintenance services was sustained by the Court of Federal Claims because the decision constituted a significant error in the procurement process that prejudiced the awardee. The government made the decision to take corrective action after the incumbent filed a Government Accountability Office protest of the award of the successor contract to another offeror. In an e-mail to the parties, the GAO attorney assigned to the protest suggested GAO would likely sustain the protest due to deficiencies in the source selection decision and would not resolve an issue concerning the timeliness of a supplemental protest. The government indicated it would take corrective action by terminating the contract, amending the solicitation, accepting revised proposals, and making a new source selection decision. The awardee then challenged the corrective action in the Court of Federal Claims.

Reliance on E-mail Inappropriate

The CFC granted the awardee’s motion for judgment on the administrative record, finding the government’s decision to take corrective action was irrational whether or not it was based on the GAO attorney’s conclusions. The contents of the GAO attorney’s e-mail were irrational because his assertion GAO was not required to consider the timeliness of the supplemental protest “clearly contravened” GAO’s statutory mandate not to entertain untimely protests. The attorney also “completely misread” and did not afford proper deference to the source selection decision.

Proper Evaluation

The CFC also found the government’s decision to take corrective action was irrational and unlawful to the extent it was based on an independent analysis of the incumbent’s protest. There was no basis for the incumbent’s argument a solicitation amendment required the offerors to propose a labor mix that complied with a collective bargaining agreement. The incumbent also failed to demonstrate “outstanding” ratings assigned to each factor for each proposal lacked a rational basis, and the fact the evaluators assigned all three proposals the same ratings did not render the ratings per se improper. Since the government properly evaluated the proposals and rendered a source selection decision, its decision to take corrective action “upset[] a properly awarded contract and therefore violate[d] the laws meant to guarantee fair competition in government procurements.” Finally, the proposed correction would lead to the termination of the initial contract award, so the awardee “easily” demonstrated prejudice. The CFC concluded the awardee met the factors for permanent injunctive relief and enjoined the government from taking the proposed corrective action. ( Systems Application & Technologies, Inc. v. U.S., et al., FedCl, 55 CCF ¶79,646)

(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )