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701 Pike Street, Suite 1700Seattle, WA 98101206.623.3427

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Bid Protests 2012: Tips and Trends

byJonathan A. DeMella

forNCMA West Sound Chapter

November 8, 2012

Snapshot Comparison

NCMA West Sound ChapterNovember 8, 2012

Issue GAO Court of Federal Claims

Statutory Jurisdiction CICA, 31 USC 3551 Tucker Act, 28 USC 1491

Procedures GAO Regulations, 4 CFR 21 CoFC Rules

Timeliness Fixed Times, 4 CFR 21.1 Equitable “Laches”

Stay of Procurement Automatic, if filed within deadline of 31 USC 3553

Not Automatic: TRO/PI Required

Protective Order Yes Yes

Awardee Participation Yes, as intervenor Yes, as intervenor

Agency Representation Agency Counsel Department of Justice

Agency Documentation Agency Report Administrative Record

Nature of Relief Recommendation Permanent Injunction

Award Protest costs Yes No, except for EAJA

Length of Process 100 days by statute Case by case, often 3-16 months

2

Recent Trends at the GAO

FY2007 FY2008 FY2009 FY2010 FY20110

500

1000

1500

2000

2500

Cases Filed


3

Recent Trends at the GAO

FY2007 FY2008 FY2009 FY2010 FY20110

50100150200250300350400450500

Merit Decisions / Percent Sustained

27%

21%18%

19%16%


4

What can be protested?Illegalities or improprieties in:

1. Solicitations by federal agencies for goods or services

2. Cancellations of solicitations by federal agencies

3. Awards or proposed awards by federal agencies

4. Terminations or cancellations of contract awards by federal agencies, if the protest alleges that the termination or cancellation was based on improprieties in contracts award

NCMA West Sound ChapterNovember 8, 2012 5

What cannot be protested?• Challenges to size standards, NAICS codes

classifications (SBA)• PIA violations not reported within 14 days of

discovery• Awards, proposed awards of subcontracts• Suspensions, debarments


6

Bid Protests


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• Forums– Agency Protest– GAO Protest– Court of Federal Claims Protest– FAA / ODRA

Agency Level Protests


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• Process Defined by individual agency supplemental regulations

• FAR 33.103 Basic Requirements– Written protest directed to the appropriate Government representative– Evidence that the protester is an “interested party” (offeror whose direct

economic interest is affected by the award)– Detailed statement of the factual and legal basis of the protest– Stated of the requested relief– Evidence that the protest is timely (proof that filed not later than 10 days

after the grounds for the protest known or should have been known – 5 days after debrief)



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• If protest is timely, Agency must suspend contract’s performance until protest is resolved, unless finding of urgent need is made

• Agency must exercise “best efforts” to resolve protests within 35 days

• Can appeal adverse protest decision to GAO or US Court of Federal Claims



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• Pros– Fairly informal process– Relatively inexpensive– Usually a quick resolution

• Cons– Often decided by the same individual whose actions form the

basis of the protest– May adversely affect the business relationship with the customer– Process varies among the agencies

GAO Protests


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• Rules set forth in 4 CFR Part 21 (outside the FAR System)

• Process is more structured, but similar requirements– Protest must be in writing– Protest must contain detailed statement of factual and legal

basis of the protest– Protest must demonstrate that offeror is an interested party– Protest must demand a ruling by the Comptroller General– Protest must state the requested relief

GAO Protests


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• May request a protective order– Access to competitor’s offer or bid– Limited to counsel admitted under the Order

• Contract performance may be suspended if protest is filed within 10 days of award or 5 days of debriefing– Remember to give GAO 1 full day to notify Agency to be on the

safe side

GAO Protests


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• Within 30 days of notification of protest by GAO, Agency must file Agency Report responding to the protest– Must be delivered to GAO, protester, and any intervenors– Must contain a complete statement of facts, memorandum of law

explaining Agency’s position under applicable procurment law, and copies of documents relevant to the protest

• Protestors and intervenors must file response to the Agency Report within 10 days– Failure to file on time will result in dismissal of protest

GAO Protests


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• Pros– Relatively informal process– Detailed but accessible rules and regulations– Meaningful participation by counsel in the process

• Cons– Lengthier decision process– Limited opportunity for meaningful discovery

Court of Federal Claims Protests


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• Civil Lawsuits brought against the Government decided under the standards of the APA

• Under APA, Agency decision presumed to be “rational.” • Decision will not be overturned unless found to be

“arbitrary and capricious, an abuse of discretion, or otherwise not in accordance with law.”

• Must show Prejudice• Rules applicable to COFC bid protests are contained in

Appendix C to the Court’s Local Rules



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• Unlike typical civil litigation, bid protests before the COFC require:– 24 hour notice to the DoJ, the Court’s Clerk, the Agency and

apparent winning offeror of the protestor’s intent to file an action

• Court will schedule an initial status conference as soon as possible after filing of the complaint to discuss:– Identity of interested persons– Whether the apparent winning offeror should be added as

intervenor in protest– Requested injunctive relief– Content and timing of filing of administrative record



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• Bid protest cases are subject to the 6 year statute of limitations established by the Tucker Act

• Unreasonable delay in filing will prejudice protestor’s right to relief



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• Pros– Ability to conduct discovery– Benefit of established rules and procedures– More formal, rigorous process

• Cons– More formal, rigorous process– Expensive– No deadline within which protest must be resolved– Agency decision given deference; high standard of review– No automatic stay without TRO

Mandatory Stay Issues


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• Critical “preliminary” relief afforded to disappointed bidders

• At Agency and GAO, triggered by timely filed protest (which is why considered “mandatory” or “automatic”)

• At COFC, must seek immediate injunctive relief (e.g., TRO, PI)

Mandatory Stay Issues


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• Pre-award protest– File before bids/offers are due– Agency may not award contract until resolved, except in

exceptional circumstances

• Post award protest– File within 10 days of contract award or five days after the

debriefing date, whichever is later– Contract performance is suspended until resolved, except in

exceptional circumstances

Sustained Cases• Most sustained protests reflect procedural

errors. • GAO does not question agency’s informed

exercise of judgment• Three areas where errors most often found:

1. Evaluation inconsistent with stated solicitation criteria (failure to follow the ground rules)

2. Inadequate documentation of evaluation

3. Discussions are inadequate or misleading


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When to Protest a“Ground Rules” Violation

• SSA fails to follow the stated evaluation criteria• Ground rules don’t mirror mission needs• Agency changes ground rules, without allowing offerors

a chance to respond to changes• Rating scheme is complex and unclear

– Offerors can’t understand requirements– Offerors can’t prepare offers intelligently, on equal basis

BUT, if this is obvious at the outset, protest right away


22

When to Protest for Lack of Adequate Documentation

• Agency must document and retain evaluation materials• There must be a supporting rationale in record to

conclude Agency had reasonable basis for source selection decision

• This will likely become apparent after protest is filed, but may be evident during debriefing

• Be inquisitive during the debriefing (this will help your attorney!)


23

When to Protest for Lack of Meaningful Discussions

• Discussions must sufficiently identify areas of concern– Tailored to each offeror’s proposal– Object is to maximize Agency’s ability to obtain best value

• Discussions must not be vague or misleading• Discussions may not favor one offeror over another• Clarifications (limited exchanges) are not discussions


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SBA Size Protests• Nothing to do with a company’s ability to perform

the work• Entirely focused on whether a company meets

the size requirements for a particular contract

25NCMA West Sound ChapterNovember 8, 2012

Bringing a Protest• Short time frame

– 5 days from bid opening or notice of the intended awardee

• Low evidentiary bar – Protestor only needs to show that there is some basis

for the belief that the protested concern is other than small for the procurement

– SBA will review a wide variety of materials• Newspaper articles, information from websites,

promotional information


Defending a Protest• Three days to respond

• SBA will require various types of business information • Annual reporting information, ownership records, familial

information, information related to business relationships, income statements and tax returns for the previous 3 years

• Failure to provide this information may result in an adverse finding

• If the protest is successful, the protested concern will lose its small business status and can’t bid on set-aside contracts until it is recertified by the SBA.


Danger Zones

• Ostensible subcontractor– When a subcontractor performs vital and primary

requirements of a contract or– The prime contractor is unusually reliant on the

subcontractor

• Familial relationships– There must be a clear line of fracture between the

companies.

• Totality of the circumstances


Best Practices• Keep up with the regulations• Be aware of your company’s internet presence• Be mindful of your business and subcontracting

relationships – particularly those involving family members


Hot Issues

• Recent Federal Circuit Decisions– Systems Application and Technologies, Inc., __ F.3d __, 2012

WL 3631249 (Fed. Cir. August 24, 2012)– Scott Timber Co. v. United States, __ F.3d __, 2012 WL 3834661

(Fed. Cir. Sept. 5, 2012)

• In-Sourcing Decisions


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701 pike street, suite 1700 seattle, wa 98101 206.623.3427 745 west fourth avenue, suite 502...

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