Does an Agency’s “Corrective Action” Have Any Limits?

In a recent case, the Army got dinged in the Court of Federal Claims (COFC) despite – indeed, because of – the agency’s efforts to correct a problematic procurement. 58 offerors bid for the Army’s recompete of its Army Desktop Mobile and Computing contract vehicle, but only 9 proposals were deemed technically acceptable. When 21 of the disqualified bidders protested, the Army took “corrective action.” It reopened the competition, allowing all offerors to submit revised proposals and new prices. But the COFC found that the proposed corrective measure was overbroad. The court’s ruling demonstrates that agencies need to tailor corrective action to procurement’s unique problems.

 

When the Army sought proposals for a series of IDIQ contracts covering desktop computer computers, notebooks, tablets, printers, and beyond, offerors were to be assessed based on three factors. Those three factors were past performance, technical acceptability, and price. Offerors were required to demonstrate technical acceptability, the primary evaluative criteria, by filling out spreadsheet forms in the RFP.

 

The Call for Corrective Action

With 58 offerors competing, you would expect many proposals would be deemed acceptable, and that price would then become the primary determinative factor. But out of all the proposals submitted, only 9 were deemed technically acceptable, and all 9 contractors with technically acceptable proposals were given contract awards. It’s no surprise that 21 disappointed offerors filed protests at GAO. The protestors felt that they had technically acceptable items, but were thwarted by confusing aspects of the required spreadsheets, and had made honest mistakes in filling them out. Those who had guessed correctly how to tackle the ambiguous spreadsheets were rewarded, and those who’d guessed incorrectly lost out.

The Army conceded that the procurement was flawed and vowed to take corrective action. Believing that the agency would remedy the issue, GAO dismissed the protest. To solve the problem, the Army decided to open discussions (which hadn’t happened in the first round), give all offerors information about deficiencies in their offers, and allow them to submit revised proposals with new pricing. Yet the protesters took the case to the COFC, arguing that that the corrective action wasn’t, well, correct.

 

When Corrective Action Is Overbroad

Now the awardees protested, this time to the Court of Federal Claims. They argued that no corrective action was warranted at all, and if any was, the Army’s actions were overbroad. The court agreed that corrective action was appropriate, even if, as the protesters had argued, the protests were untimely. However, the court responded to the protestors’ other objections by confirming that the army’s solution was indeed overbroad. According to the court, the army’s correction action “was not tailored to narrowly target the defects that it was intended to remedy,” thus raising the question of proper scope when corrective action is required.

Since the defect with the procurement lay in ambiguous spreadsheets, the Army should have offered a second chance only to competitors disqualified because of that defect. Yet reopening the competition allowed all competitors another chance, regardless of whether the issue with their original proposal had been rooted in the ambiguity of the solicitation. Specifically, the court felt that the Army should have allowed clarifications, but only to the offerors affected by the problems with the spreadsheets.. Presumably, those who had attractive pricing would have then earned contracts, perhaps supplanting some of the original awardees.

 

So How Far is Too Far?

When considering whether to protest in instances where an agency’s corrective action seems incorrect, the court’s statements in this case summarize the thrust of recent case law at the Court of Federal Claims. An agency can take action to correct a defect even if the protest might fail, for instance because it was untimely. However, that corrective action must be “tailored to narrowly target the defects that [the corrective action] was intended to remedy.” Their use of the words “narrowly target” is particularly interesting as it reveals that the intention of corrective action should not be to revise the entire procurement but simply remedy the specific aspects of it that were problematic. This case provides authority that favors protestors in times where an agency’s corrective action goes too far.

UPDATE: This case has been appealed to the U.S. Court of Federal Appeals for the Federal Circuit. Stay tuned for the next chapter.

Dell Federal Systems, LP, et al. v. United States, et al., 2017 WL 2981811, July 3, 2017.

 

For more on this topic, listen to my interview with Jared Serbu on Federal News Radio’s Federal Drive.

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s