In another recent U.S. Navy procurement, in this case a procurement for execution, planning, maintenance, repair, and alterations of FFG-7 class frigates, the GAO sustained a bid protest because the Navy conducted a flawed cost realism assessment of both the awardee’s and the protester’s proposals. Earl Industries, LLC, Comp. Gen. Dec. B-309996 et al., Nov. 5, 2007. Regarding the awardee, the Navy failed to resolve an inconsistency between the offeror’s cost and technical proposals regarding the number of labor hours that would be assigned to a certain subcontractor whose direct labor rates were significantly lower than those of the awardee and other subcontractors. Regarding the protester, the Navy applied the company’s historic division-wide composite labor rate, rather than its proposed labor rate, without meaningfully considering the protester’s explanations during discussions that the firm’s division-wide rate included labor categories that would not be used during contract performance. The GAO stated that, in the absence of such consideration, what the Navy did was nothing more than a verification of the protester’s historical rate, and not an adequate cost realism analysis assessing the firm’s probable cost of performing the contract in accordance with its proposed technical approach. In addition, the GAO also sustained the protest because the Source Selection Authority did not reasonably assess the respective technical merits associated with the awardee’s and the protester’s proposals in his decision to select the awardee’s proposal for award based upon its lower evaluated cost.