This month's bid protest spotlight examines three recent decisions at the U.S. Government Accountability Office and the U.S. Court of Federal Claims. FreeAlliance.com LLC v. U.S. and Versa Integrated Solutions Inc. involve late proposal submissions at the GAO and the COFC. U.S. Marine Management Inc. addresses establishment of interested party status and timeliness.
The GAO has strict rules for latrare proposals and the COFC is often more forgiving. In the FreeAlliance.com protest, however, the court took a page from the GAO's book and upheld the agency's application of the late-is-late rule.
In late 2020, the Internal Revenue Service issued a solicitation for a single-award blanket purchase agreement. The acquisition was to be conducted utilizing a multiphased-down select approach.
Following a round of corrective action, the IRS issued an amendment to the solicitation advising Phase 2 participants of new deadlines for questions and revised quotations. The agency informed vendors that if responses were not received by the Jan.19 deadline, the vendor would be considered nonresponsive and removed from consideration for award.
Shortly thereafter, the agency issued a clarification statement to the amendment, extending the quotation deadline by two days to Jan. 21 at 12 p.m. Eastern Standard Time.
On Jan. 21, at 11:51 a.m., FreeAlliance attached its revised quotation to an email to the contracting specialist. FreeAlliance did not receive a delivery receipt, so an employee sent the agency a test message at 12:03 p.m. to determine whether the earlier message had been received.
The contracting specialist responded to FreeAlliance's test message at 12:10 p.m., confirmed that the email did not contain any attachments, and instructed FreeAlliance to zip the attachments or send in separate emails. At 12:15 p.m., FreeAlliance resent its quotation in a zip file to everyone copied on the contracting specialist's email, including the contracting officer.
At 3 p.m., FreeAlliance emailed the contracting specialist and requested confirmation of receipt and evaluation of its quotation. In response to FreeAlliance's email, the contracting specialist asked the agency's IT department to determine the exact time FreeAlliance's 11:51 a.m. email was received by the IRS servers.
The IRS confirmed that FreeAlliance's email reached its servers at 12:06 p.m. — six minutes past the deadline set forth in the clarification statement to the amendment.
The contracting specialist emailed FreeAlliance to inform the company that because its revised quotation was received after the time stated in the solicitation and in accordance with the late-is-late rule, FreeAlliance was ineligible for award. FreeAlliance then filed a protest at the COFC.
FreeAlliance challenged the agency's decision in two respects. First, FreeAlliance argued thelate-is-late rule was inapplicable because the original solicitation did not include a lateproposal submission and the amendment did not incorporate any explicit late-is-lateprovisions from the Federal Acquisition Regulation.
FreeAlliance suggested that because the late quotation prohibition appeared on page one ofthe amendment and stated that the solicitation is "revised as identified on the followingpages," only pages two through five actually modified the solicitation.
The court found this argument unconvincing because, when read in its entirety, the agencyclearly intended all pages of the amendment to modify the solicitation. The court also concluded that, although the original solicitation did not include a proposal deadline and theamendment did not include a specific FAR timing provision, the amendment was enforceableon its terms.
Second, FreeAlliance argued the agency's decision not to waive the quotation deadline wasarbitrary and irrational because the agency had the authority to waive the deadline as aminor informality.
The court disagreed because that authority only applies in procurements governed by FARParts 12 and 15 and this was a FAR Part 8 procurement. Accordingly, the agency's decisionto enforce the terms of the solicitation and reject FreeAlliance's submission as late was rational.
This case reinforces the importance of submitting proposals with ample time to account fortechnological glitches that may delay transmission of a proposal. We are also reminded thatwhere the solicitation and any of its amendments provide an explicit deadline for proposalsubmission, even the court will enforce the late-is-late rule.
Versa Integrated Solutions
Unlike the COFC, which adopted certain exceptions to the late-is-late rule — none of whichapplied in FreeAlliance — the GAO has maintained a strict approach to late proposalsubmissions. Indeed, when presented with an express opportunity — or rather, a request —to revise this approach, the GAO has declined to do so.
In the Versa protest, the U.S. Department of Health and Human Services issued a requestfor proposals that provided for the submission of proposals in two parts. Part one proposalswere to be submitted electronically to the contract specialist with a courtesy copy to thecontracting officer by Nov. 12, 2021, at 12 p.m. Eastern Standard Time.
The request for proposals also incorporated FAR 52.212-1(f), which provides that any offerreceived at the government office designated in the solicitation after the exact timespecified for receipt of offers is considered late and will not be considered for award unless itis received before award is made; the contracting officer determines that accepting the lateoffer will not unduly delay the acquisition; and
(A) If it was transmitted through an electronic commerce method authorized by thesolicitation, it was received at the initial point of entry to the Government infrastructure notlater than 5 p.m. one working day prior to the date specified for receipt of offers; or
(B) There is acceptable evidence to establish that it was received at the Governmentinstallation designated for receipt of offers and was under the Government's control prior tothe time set for receipt of offers.
On Nov. 12, 2021, the agency received 20 part-one proposals. On Jan. 24, the agencyconcluded its evaluation of proposals and sent advisory notifications to the 20 offerors.
On Feb. 8, a representative from Versa contacted the contracting officer for an update onthe status of its proposal. The contracting officer informed Versa that it had not received itspart-one proposal submission. Versa sent the agency a series of trace logs from its server,showing that it had submitted its proposal to the agency well in advance of the deadline.
While the agency's IT personnel worked to verify whether Versa's proposal made it to thegovernment servers, Versa filed a protest with the GAO. It was then discovered that Versa'spart-one proposal was received prior to the submission deadline but quarantined by theagency's server, and not received by either the contracting officer or the contract specialist.
Versa argued the agency's rejection of its proposal was unreasonable because Versasubmitted its part-one proposal before the deadline and the agency was in control of theproposal following submission.
Most notably, Versa acknowledged that the GAO has previously considered and rejected theapplication of the so-called government-control exception in its 2002 Sea Box Inc.decision. In its protest, however, Versa requested that the GAO use this case as anopportunity to revisit its prior decision.
The GAO declined to overturn its decision in Sea Box, and explained that FAR 52.212-1(f)(2)(i)(A) applies to proposals submitted by electronic means and only permits a lateproposal to be considered when it was received at the initial point of entry no later than 5p.m. the preceding working day.
The GAO further noted that if it were to consider electronically submitted proposals aseligible under FAR 52.212-1(f)(2)(i)(B), regardless of whether they were received by 5 p.m.the day before the proposal due date, FAR 52.212-1(f)(2)(i)(A) would ultimately berendered null.
Accordingly, because Versa's proposal did not arrive to the initial point of entry by 5 p.m.one working day prior to the deadline, the GAO concluded that the agency acted accordancewith FAR 52.212-1 and properly rejected Versa's proposal.
Where FAR 52.212-1 is included in the solicitation and proposals are to be submittedelectronically, it is in the contractor's best interest to submit its proposal by 5 p.m. oneworking day prior to the proposal submission deadline. If this is not possible, werecommend requesting confirmation of receipt of the proposal with enough time to allow resubmission if necessary.
This protest is also yet another reminder of the GAO's strict adherence to the late-is-laterule, and that it is best to avoid these types of protest arguments at all costs.
U.S. Marine Management
The final protest this month covers interested-party status and timeliness, both of which are critical to achieving a successful protest.
In U.S. Marine Management, the U.S. Department of the Navy issued a request forproposals under FAR Part 12, using the negotiated-procurement policies under FAR Part 15, for a time charter of an ice-glass tanker vessel. The request included FAR 52.212-1, which allows an offer to be withdrawn by a written notice that is received at any time before the exact time set for the receipt of offers.
Marine Management submitted three proposals in response to the request, each proposing different vessels. The agency engaged in discussions with Marine Management from Aug. 12, 2021, through Aug. 26, 2021. On Sept. 7, 2021, Marine Management submitted onerevised proposal, reaffirmed another proposal without revisions, and withdrew its third and final proposal.
On Nov. 3, 2021, the agency notified Marine Management that, although its third proposal was ultimately withdrawn, it had been included in the competitive range. Marine Management's remaining proposals — the ones it did not withdraw — were excluded from the competitive range.
After the conclusion of discussions, the Navy set a date for final proposal revisions. Marine Management did not submit any final revisions of its proposals.
On Dec. 23, 2021, the Navy informed Marine Management that it had not received thetanker charter contract. The notice of award informed unsuccessful offerors of their right to request a debriefing, which Marine Management requested. Marine Management received a debriefing for the proposal it withdrew.
After receiving the agency's responses to Marine Management's debriefing questions, Marine Management submitted the subject protest to the GAO, arguing the agency relaxed orwaived solicitation requirements for the awardee, and that the awardee's technical and priceevaluation was unreasonable.
The agency submitted a motion to dismiss the protest, arguing in part that MarineManagement was not an interested party because its proposals were either withdrawn or excluded from the competitive range. Marine Management responded that it was an interested party because the procurement errors alleged warranted the cancelation and resolicitation of the contract.
The GAO was not convinced. The GAO explained that if it sustained Marine Management's challenges to the awardee's technical and price evaluation, the recommendation would befor the agency to reevaluate proposals and make a new award decision. Such recommendation, however, would not involve consideration of any of Marine Management's proposals because, as discussed, two of Marine Management's proposals were excluded from the competitive range and one was withdrawn.
Thus, if the GAO sustained Marine Management's challenges, Marine Management would neither be next in line for award nor would it be able to submit a revised proposal. Accordingly, the GAO found that Marine Management did not qualify as an interested party able to challenge the agency's technical and price evaluation of the awardee's proposal.
The agency also argued that Marine Management's protest was untimely because it wasfiled more than 10 days after Marine Management learned of the basis for its remaining protest ground. The agency explained that Marine Management's post-award debriefing was not required and was instead a courtesy that did not toll the 10-day period to file a protest.
The GAO agreed, finding that because Marine Management had withdrawn its proposal in accordance with FAR 52.212-1, Marine Management was not considered an unsuccessful offeror entitled to a post-award debriefing. With that, the GAO analyzed the timeliness of Marine Management's protest without the debriefing exception and determined that Marine Management's protest was untimely.
This protest is a reminder that a contractor must overcome various jurisdictional hurdles before the GAO will hear its protest on the merits. Both interested-party status and timeliness are key to achieving a sustained protest, and should be analyzed carefully before pursuing a protest.