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2025 Procurement Review: Protests



Contents

 

Successful GAO Protests

Court of Federal Claims

CAFC

SBA Office of Hearings and Appeals

Introduction

Jurisdiction/Timeliness/Standing/Override

Jurisdiction/Standing/Ripeness

Jurisdiction/Timeliness/Standing

Defective Solicitations

Responsiveness/Late Bids/Proposals

Evaluations

Ostensible Subcontractor

Evaluations

Solicitations

Solicitation Language

Other Affiliation Issues

Responsiveness/Late Bids

Evaluations

Sole Source /Small Business

Other Miscellaneous Size Issues

Sole Source/Small Business

Sole Source /Small Business

Miscellaneous

8(a) / SDVOSB / WOSB Status / HUBZone

Recovery of Costs

Corrective Action & CICA Stays

 

NAICS

Conflict of Interest

EAJA

 

 

Corrective Action

OCI

 

 

Miscellaneous

 

Responsiveness

   

 

Successful GAO Protests

Introduction

So far this year, the GAO has published  13 decisions sustaining protests on the merits (some of which were originally dated in 2024 but not issued to the public as redacted versions until this year).

Solicitation Terms 

The GAO sustained a preaward protest by The Mission Essential Group, LLC, finding that the use of lowest-priced-technically-acceptable (LPTA) source selection procedures for the acquisition was improper because the agency had not satisfied the following requirements of DFARS section 215.101-2-70: (i) the solicitation did not reasonably define the minimum requirements for the required services "clearly and comprehensively" or express the requirements "in terms of performance objectives, measures, and standards that would be used to determine the acceptability" of an offer; (ii) the agency had not established that “[n]o, or minimal value will be realized from a proposal that exceeds the minimum technical or performance requirements"; and (iii) there was no determination from the agency that the lowest price would reflect full life-cycle costs. The GAO was unimpressed and unpersuaded by the facts that the solicitation had been recommended by the agency's complexity analysis tool (CAT) or that the agency had used this model on other similar solicitations.

Flawed Evaluation / Lack of Meaningful Discussions 

Both MicroTechnologies LLC and SMS Data Products Group, Inc. won their GAO protests against a task order award to Trace Systems Inc. The GAO sustained the protest by SMS Data Products Group, Inc. because: (i) in evaluating professional compensation, there was no explanation for the agency's adoption of a baseline of 8% below the incumbent's rates before proposed rates would be flagged, and the agency did not evaluate whether the lower rates were sufficient to "maintain program continuity, uninterrupted high-quality work, and availability of required competent professional service employees" as required by FAR § 52.222-4; and (ii) the agency failed to conduct the price risk analysis required by DFARS § 252.204-7024, specifically "a measure of whether a proposed price for a product or service is consistent with historical prices paid for that item or service." In  MicroTechnologies LLC, in addition to finding the lack of the required price risk analysis discussed in its SMS decision, the GAO held that:  (i) the agency  unreasonably compared the awardee's proposed direct labor rates for professional personnel only to market data instead of to the incumbent's direct labor rates, as required by FAR § 52.222-4; (ii) the record did not contain a comparison of proposed fringe benefits to the incumbent's fringe benefits, as also required by FAR § 52.222-4; and (iii) in evaluating non-professional compensation in  the parties' revised proposals, the agency ignored the solicitation requirement that it compare proposed rates to the incumbent's rates.

The GAO sustained a protest by Perimeter Security Partners, LLC, concluding that the agency unreasonably found a technical quotation unacceptable after assigning two deficiencies for pages from that allegedly exceeded a page count limit when the solicitation was latently ambiguous as to whether the items in dispute (charts) were among those that the solicitation indicated would be excluded from the page count and where both the agency's and the protester's interpretations were reasonable. 

The GAO sustained protests by SynergisT JV LLC and VMD Systems Integrators, LLC dba VMD Corp. because the agency improperly disqualified the protesters for quoting based on their underlying FSS labor categories rather than the special item number (SIN) identified in the RFQ when the solicitation did not specifically limit quotes to that SIN. 

The GAO sustained a protest by TISTA Science and Technology Corp. because the agency evaluated essentially equivalent quotations disparately in three areas, including surge staffing, surge staffing onboarding, and the use of a master schedule to track projects. 

The GAO sustained a protest by Trace Systems, Inc. because the agency's evaluation of the awardee did not comply with the specific criteria in the  PWS for evaluating the relevance of past performance. 

Anika Systems, Inc. won its protest because, although the GAO denied quite a few of the protester's grounds for protest, it did find that the agency's evaluators treated the protester and the awardee unequally (a) in assigning only the awardee's proposal a positive finding for identifying significant goals of standards, structure, relative tools for work, security, and audit capabilities when the protester's proposal provided a similar approach, (b) in concluding that the protester’s proposal lacked "innovative visualizations," and (c) in assigning the protester's proposal a lesser rating in its approach to data automation when the awardee's proposal contained the same features. 

In Centerra Security Services GmbH and Continuity Global Solutions, LLC, another case involving consolidated post-award protests, this one with mixed results, the court held that: (i) the agency properly followed the "late is late" rule by rejecting the awardee's revised proposal for being one minute late, without being required also to reject its initial, timely proposal, and by allowing the eventual awardee to participate in continued discussions and to  submit further proposal revisions because its continued participation in the procurement would not prejudice other offerors and did not result in unequal treatment since all offerors had the opportunity to correct deficiencies in their proposals; (ii) the agency used unstated evaluation criteria (which its own evaluators stated were "in addition to" the recency and relevancy criteria in the solicitation) to demote one plaintiff's past performance rating; (iii) the agency did not treat that same plaintiff and the awardee disparately by giving the awardee a higher evaluation under the technical factor regarding required licenses and permits because, as the incumbent, the awardee would naturally have the advantage of already having such licenses and required certifications for its instructors; (iv) the source selection advisory committee had a rational explanation for giving the other plaintiff a lower score in the technical area than the initial evaluators had; and (v) the agency's evaluation of total proposed staffing numbers was not arbitrary, and its overall evaluation of the second plaintiff's management plan complied  with the solicitation's evaluation scheme. 

The GAO sustained a protest by Owl International Inc., d/b/a as Global, a 1st Flagship Co. because the agency ignored the solicitation requirement to assess professional compensation plans in accordance with FAR § 52.222-46. 

Responsiveness, Late Bids, Expired Bids

The GAO sustained a protest by UNICA-BPA JV, LLC because, although the agency could have declared the firm ineligible for award for lack of a SAM registration at the time of its initial offer, the agency allowed it to remain in the competition and later to submit a revised offer after discussions, at which time it had a valid SAM registration. Similarly, the GAO sustained a protest by Metris LLC, B-422996.2, holding that it was improper for the agency to declare a firm ineligible for award for a break in its SAM registration between the time of its initial proposal and its final proposal revision because the final proposal revision extinguished the original proposal and the SAM registration was active at the time of the final proposal revision and from then through award.

Sole Source/Small Business/Restricted Competitions

In a decision involving statutory interpretation, the GAO sustained a protest by E.K.K. Investments, LLC, holding that in a solicitation (by means of an RFI) for fresh fruits and vegetables for resale at commissary stores in Korea, the agency could not establish a sole-source BPA without executing a J&A or soliciting offers from as many sources as practicable.

In Analysis, Studies, and Training International, LLC, and SOFIS-TRG, LLC (unsuccessful consolidated protests by two firms eliminated from a procurement set aside for women-owned small businesses (WOSBs) pursuant to a DoD class deviation, which required that offerors submit SAM certifications with their offers showing that they were WOSBs), the Court of Federal Claims held that: (i) the SAM registration and submission requirements were material terms of the solicitation (based on a detailed analysis of the meaning of the term "material") and, therefore, could be a basis for disqualifying an offeror; (ii) one firm's SAM registration mistakenly failed to identify it as a WOSB, and that firm's explanation for the mistake could not cure the problem; and (iii) the other firm's SAM registration lapsed for a few days between the submission of its offer and the  award, which violated FAR § 52.204-7(b)(1)'s requirement applicable at that time that offerors must "be registered in SAM when submitting an offer or quotation, and . . . continue to be registered until time of award." Concerning this latter issue, the court held that a subsequent revision of the FAR provision was not retroactive, and the plaintiff had not submitted a "final  proposal revision" even if such a revision could have cured the lapse in SAM registration.  

Conflicts of Interest

The GAO sustained a protest by  DirectViz Solutions, LLC,  because the agency failed to adequately consider an impaired objectivity OCI arising from the awardee's  work under a previously awarded task order, which would require the awardee to advise the agency on work in which it had a competing interest because of its role in the protested award.

Corrective Action 

Recovery of Costs

Discovery/Miscellaneous

Court of Federal Claims

Timeliness/Standing/Jurisdiction/Automatic Stay 

In Raytheon Co., Court of Federal Claims Judge Bonilla (seeking to provide some clarity on a jurisdictional issue courts have confronted without a clear standard so far) held that the court has exclusive Tucker Act bid protest jurisdiction over challenges to those "other transactions" and "other transactional agreements" defined in 10 U.S.C. §§ 4021–22 that involve  "an acquisition instrument other than a traditional procurement vehicle intended to provide the government with a direct benefit in the form of products or services" [emphasis added] as opposed to those intended only to facilitate "the creation or expansion of a commercial market for the general public from which a federal agency or instrumentality might someday purchase." 

In Siemans Government Technologies, Inc., the court denied the Government's motion to dismiss a protest seeking to recover the plaintiff's bid preparation costs on two canceled procurements for lack of jurisdiction due to FASA's bar on task order protests in the court because neither requirement in the statute (that the protest be (i) in connection  with (ii) a proposed or issued task order) had been met: (i) the solicitation was redundant and could not be consummated because the Government was aware it already had a contract in place for the solicited services; and (ii) the plaintiff "has never sought to set aside or generally interfere with any pending or issued task order [and] only wishes to be made whole after being led astray by the [Government's] false procurement needs--a claim FASA does not bar."

The court held that, as a debarred individual, Dee Monbo, lacked Article III and statutory standing to protest an agency's refusal to consider her offer in response to a solicitation. 

In Starside Security & Investigation, Inc., the court held that the rule that a protester is entitled to CICA's automatic stay only if the Contracting Officer receives notice of a GAO protest within 10 days of award can be equitably tolled and should have been in this case because the protester did not receive timely notice of award through no fault of its own and despite its diligent efforts to obtain that information.  

In KL3, LLC, an unsuccessful protest of an agency's set-aside of two contracts for the 8(a) program, the court began its opinion with a lecture on the importance of alleging and proving prejudice in any protest, the failure of which doomed this one:

In order to successfully protest a government procurement, a protestor must demonstrate that the government agency committed an error in conducting the procurement at issue and that the error prejudiced the protestor. Although both of these requirements must be met, protestors regularly focus (sometimes exclusively) their protest pleadings and briefing on the former requirement, ignoring the equally important prejudice requirement. Many times, this strategy works as the prejudice created by an agency’s error is readily apparent. Shinseki v. Sanders, 556 U.S. 396, 410 (2009) (“Often the circumstances of the case will make clear [that the error] . . . was harmful and nothing further need be said.”). But in instances in which the alleged prejudice caused by the error is not obvious, failure to allege in the complaint and then prove prejudice on the merits is fatal to a protestor’s case. As will be explained in detail below, prejudice in the instant protest falls into this non-obvious category and is fatal to the protestor’s case.

Despite the fatal ending to which failure to plead and prove prejudice in a bid protest leads, this is by far not the first time a protestor has offered only conclusory allegations and statements regarding prejudice in both its complaint and briefing on its motion for judgment on the administrative record. The Court is not sure if this failure to plead and prove how an error is harmful to the protestor is the result of protestors believing the errors they allege are so obviously prejudicial (even if they are not) that there is no need to allege or prove them or whether protestors simply think that prejudice is some technicality that a judge will fill in for them if an error has been proved. But filling in allegations and proof of a necessary component of a bid protest is neither a judge’s job nor even an appropriate task for a judge in our adversarial system of justice. Simply put, a protestor bears the burden of plausibly alleging in its complaint that an agency not only committed an error in the procurement process but that this error caused the protestor harm. Then, on the merits, it must prove both of these allegations.

Solicitation Language

 In MVL USA, Inc., which involved successful consolidated protests by 12 construction companies, the court held that federal agencies' automatic mandate that prospective contractors enter project labor agreements with unions in order to be considered for federal construction projects exceeding $35 million based on E.O. 14063 is anticompetitive and arbitrary and capricious and violates the CICA directive that agencies must promote full and open competition in federal procurements unless a statutory justification is properly invoked.

Responsiveness

In Science and Technology Corp., an unsuccessful post-award protest, the court upheld an award because the plaintiff had failed to provide required information in multiple sections of its proposal. Specifically, the court held: (i) there were rational bases for the agency's upward adjustment of the plaintiff's proposed costs in the cost realism analysis because the plaintiff failed to provide sufficient information to support them; (ii) the court would not accept the plaintiff's current explanations for its costs because they had not been included in its proposal; (iii) the agency was not required to hold discussions concerning the missing information where the solicitation clearly stated the agency did not intend to hold discussions and the solicitation clearly required the explanatory data the plaintiff failed to provide; (iv) the agency was not required to seek clarifications to allow the plaintiff an opportunity to cure deficiencies in its proposal; (v) there was a rational basis for the agency's evaluation of the plaintiff's proposal for Mission Suitability because, inter alia, the plaintiff's proposal lacked a clear explanation of how it would perform the contract requirements in this area; and (vi) there was a rational basis for the differing Past Performance evaluations of the plaintiff's and the awardee's proposals because the plaintiff had failed to provide relevant explanatory information in its proposal. Subsequently, the court of Federal Claims denied the plaintiff's request for a stay of the court's decision pending the plaintiff's appeal to the CAFC, finding, inter alia, that the plaintiff was unlikely to prevail on the merits of its argument that the agency should have decided to conduct discussions in this Part 15 procurement.

Evaluations/Discussions

In In DecisionPoint Corp., an unsuccessful post-award protest of the award in a SDVOSB set-aside  procurement that permitted teaming with large business subcontractors, the court held that: (i) the respective functions of the awardee's team members were clearly stated and were in line with the solicitation's requirements, including the requirement that offerors demonstrate that they would "successfully integrate and coordinate all [contract] activities" under the contract, especially where the SDVOSB/prime contractor would fill all management positions, would comply with the limitations on subcontracting requirement by incurring more than 50% of the labor costs, and certified in its proposal that it agreed with all terms, conditions, and provisions in the solicitation, including the small business qualifications; (ii) the agency gave a rational explanation for its adjectival rating of the awardee's  past work experience as "somewhat relevant" under the Past Performance evaluation, especially where the plaintiff conceded its own calculations of what the awardee's relevancy rating should be were wrong; and (iii) the agency followed the solicitation's requirement by evaluating the  past performance of the awardee's team members as a whole, rather than separately, as suggested by the plaintiff. 

In RELI Group, Inc., an unsuccessful post-award protest against a task order award in response to an RFQ for medical auditing services, the court held that the agency was not required to conduct discussions with all offerors because (a) this was a FAR Subpart 8.4 procurement, (b) the solicitation specifically disclaimed the use of FAR Part 15 procedures, and (c) the RFQ specifically contemplated discussions with "at most" two offerors. In these circumstances, the decision not to hold discussions with the plaintiff did not violate "fundamental fairness" because the award was made on the basis of the evaluation of initial proposals, and discussions were used only to confirm the initial evaluation.  

In Orion Government Services, LLC, an unsuccessful post-award protest, the court held that: (i) the agency's evaluation of price reasonableness by comparing offerors' prices to the IGE and to one another complied with the FAR and was unobjectionable; and (ii) the Agency Record was sufficient to establish that the agency also evaluated offers for unbalanced pricing, even though the record did not include the details of that evaluation. 

In AcmeSolv, Inc., an unsuccessful post-award protest, the court held that, viewed as a whole, the agency's Past Performance evaluation was not merely quantitative (which the plaintiff alleged violated the solicitation), but was qualitative as well, and the  plaintiff undermined its allegation by offering its own quantitative analysis to argue that its past performance should have been evaluated more highly. The court also held that the plaintiff failed to show prejudice because, even accepting the evaluation it claimed its past performance deserved, it was only equal to the awardee in the Past Performance and Technical evaluations, while its price was significantly higher than the awardee's.  

In Blue Water Thinking, LLC, an unsuccessful post-award protest, the court held that: (i) given the Contracting Officer's thorough (90+ page) trade-off analysis and the extended length of the procurement, her timing in conducting a prior OCI investigation and in seeking an OCI waiver and her prior reference to the eventual awardee as the "apparent awardee" did not amount to "pre-selecting" the eventual winner and, therefore, were not objectionable; (ii) the solicitation required only that unbalanced pricing be considered, and did not require a price realism analysis; (iii) there was an adequate basis in the record for the Contracting Officer's decision to accept the technical evaluation panel's rating of the awardee's proposal as "outstanding" in the third evaluation, when she had downgraded that rating to "good" in the second evaluation; and (iv) the competing proposals were not sufficiently identical to support the protester's claim of disparate treatment in the evaluation of technical capability.  

In Thales USA, Inc., an unsuccessful post-award protest in a solicitation for a firm fixed-price contract to replace the Air Force’s legacy tactical air navigation systems with a new man-portable system, the Court of Federal Claims held, inter alia, that: (i) the D&F underlying the solicitation clearly stated the agency would not evaluate past performance, and past performance was not an evaluation criterion, so the protester's post-award complaint in this area was waived (Blue & Gold Fleet); (ii)  the agency was not required to assign a weakness to the awardee in an evaluation factor that the solicitation clearly stated would be evaluated only as Acceptable or Unacceptable; (iii) the agency did not evaluate offerors unequally because the offers were not substantially identical in the areas complained of by the plaintiff; and (iv) the agency's price realism analysis was consistent with the solicitation's evaluation scheme and utilized acceptable methods of analysis.

In System Studies & Simulation, Inc., et al., which involved unsuccessful consolidated post-award protests in an acquisition of helicopter training support services, the court held that: (i) pursuant to the CAFC's decision in Oak Grove Technologies, the plaintiffs had waived their right to object to the agency's failure to conduct discussions as allegedly required by DFARS § 215.306(c), 10 U.S.C. § 3303(a)(2), or FAR § 15.306(a)(3) because the solicitation had made it clear that the agency did not intend to do so; and (ii) various weaknesses and deficiencies assigned to the plaintiffs' proposals had a rational basis and complied with the solicitation's evaluation scheme or were not prejudicial. 

In GovWave, LLC, et al., the court dismissed a large group of consolidated preaward protests against the elimination of the plaintiffs in a preliminary stage of the evaluation process for failure to comply with one of what the solicitation repeatedly labeled as "Strict Compliance Requirements" (a statement on adverse past performance,  a complete price model, and a complete equipment list) because the solicitation clearly and repeatedly (ad nauseum, actually) warned that any such failures would result in disqualification from further consideration. 

In Warrior Focused Solutions, LLC, an unsuccessful post-award protest, the court held that: (i) under Blue & Gold Fleet, the plaintiff had waived its objection to the agency's failure to conduct discussions because it had not timely protested the unequivocal statement in the solicitation that there would not be any discussions; (ii) there were rational bases for assigning weaknesses in each of many areas challenged by the plaintiff in the evaluation of Mission Capability; (iii) there was a rational basis for rating the plaintiff's Small Business Participation plan as Good rather than Outstanding because the rating was based on a holistic evaluation rather than focusing only on an allegedly  unenforceable teaming agreement, and according to the agency's evaluator who identified discrepancies in its proposal, clarification concerning some clerical errors among them should be sought only if  the Government decided to enter discussions; and (iv) the Cost Realism analysis was unobjectionable because, inter alia,  lacking any documentation, such as rate agreements or historical rates, to justify the newly formed JV's proposed overhead and G&A rates, the agency was justified in performing the cost realism analysis of the plaintiff by comparing its proposed rates to those of the two other offerors, which is an acceptable method under FAR § 15.404-1(c)(iii).  

In Culmen Int'l, LLC, an unsuccessful post-award protest in a solicitation for threat reduction logistics services, the court held that the agency did not err: (i) in assigning the awardee a technical rating of "Outstanding" even though cost realism analysis had determined its proposed prices were too low because the solicitation required the cost and technical evaluations to be made separately; (ii) in evaluating the awardee's Past Performance because, contrary to the plaintiff/incumbent's allegation, the solicitation did not require each individual past performance reference to demonstrate experience in every aspect of the PWS; (iii) in assigning the plaintiff a weakness for failing to address replenishment requirements (and the agency did not evaluate the competitors unequally in this area because the awardee proposed a different approach than the plaintiff); and (iv) in adjusting the plaintiff's proposed travel costs upward during the price realism analysis because the plaintiff failed to include sufficient details of its travel plans for effective evaluation and substantiation of the validity of those proposed travel costs (especially given the significant variance between the plaintiff's proposed travel costs and the IGCE). The court also held that the agency took appropriate steps to investigate the plaintiff's claims of bias in an evaluation board member, removing one board member from the evaluation for the appearance of possible bias and retaining another member as a nonvoting member of the board. 

In DevTech Systems, Inc., an unsuccessful, scattershot, post-award protest in a solicitation for a task order for technical professional staffing, the court held, inter alia, that the agency reasonably found that the awardee's proposal complied with the material requirements of the solicitation in all the areas challenged by the plaintiff, e.g.: (i) the awardee's reference to another section of its proposal in describing its approach to the Optional Tasks complied with the solicitation's instructions to be concise and to avoid repetition; (ii) the agency's evaluation of the awardee's pricing had a rational basis, especially where, pursuant to Blue & Gold Fleet, the plaintiff had waived its objection involving any patent inconsistency between the quantity of Optional Tasks listed in the Tasks Section versus the Payment Schedule of the solicitation; (iii) the awardee's proposal did not reserve a right to re-price the Optional Tasks at a later date, but merely recognized that they would be better defined after contract award;  (iv) there was a rational basis for the agency's determination that the awardee's proposal concerning one task was a weakness, rather than a more serious deficiency, especially where the task in question was an immaterial requirement, and the plaintiff was not prejudiced by the agency's evaluation because the plaintiff's proposal contained the same weakness as the awardee's; (v) similarly, the  agency rationally concluded that awardee's proposed project manager met the solicitation's qualification requirements, and, in any event, the plaintiff was not prejudiced because its own proposed project manager had the same type qualifications; and (vi) the awardee appropriately mapped its proposed positions to categories in its underlying MAS price list, and in any event, the plaintiff was not prejudiced because its own proposal contained the same infirmity as it alleged in the plaintiff's.  The court also held that the plaintiff could not establish prejudice from the agency's alleged failure to evaluate professional compensation in connection with FAR § 52.222-46, and in any event, the plaintiff had waived that objection under Blue & Gold Fleet because the omission of that provision in the solicitation was a patent error. The court also held that the agency had not been required to conduct discussions and did not do so; and, even if the agency had undertaken discussions, it would not have been obligated to inform the plaintiff that its price was too high.

In 22nd Technologies, Inc., a successful post-award protest against the evaluation of the plaintiff's proposal, the court held that: (i) in concluding that the plaintiff had failed address one item under the Management evaluation factor, the agency's evaluators "simply . . . missed" the proposal's clear and properly placed discussion of that issue; and (ii) in evaluating the Staffing factor, the agency ascribed a weakness to the plaintiff's proposal language that was similar to that of other offerors whose proposals the agency had not faulted.

In Red Cedar Harmonia, LLC, et al., which involved unsuccessful consolidated protests concerning a solicitation under FAR § 8.405-3 seeking quotations for a single-award blanket purchase agreement ("BPA") for on-premises and cloud infrastructure support services, the court: (i) rejected the protesters' allegations that the Past Performance evaluators should have treated one of the awardee's references  (an IDIQ contract) as a series of delivery orders since only some orders were placed within the solicitation's five-year recency window; and (ii) held that the protesters lacked standing to assert that only the part of the contract within the recency window should be counted because the protesters, themselves, submitted contracts only partially within the window and the agency had evaluated those contracts as a whole. The court also held that although the protesters were correct that, in conducting the price evaluation, it might have been wise for the agency to have done more than simply recognize that the awardee's significantly lower price was due to its stratagem of mapping less qualified workers to BPA roles, the agency was not required to do so either by FAR § 8.405-3(b)(2)(vi) or the solicitation because neither of them required a price realism analysis.  

In Gemini Tech Services, LLC, a successful post-award protest of a task order award for logistics support services, the court held that by establishing the competitive range and opening discussions with all six offerors absent any analysis in the record of how or why the offerors were considered "the most highly rated" against the technical acceptability factor, the agency violated FAR § 15.306(c)(1). 

In Professional Analysis, Inc., an unsuccessful post-award protest which involved interpreting a solicitation, the court held that: (i) where the solicitation expressly provided that minimum proposal requirements were identified by the word "shall," a proposal instruction merely requesting a certification was not a mandatory requirement; (ii) there was a rational basis for the agency's conclusion that the awardee's proposal contained only assumptions and  reservations (which it adequately explained) but no exceptions to any material solicitation terms; (iii) there was nothing improper about a statement in the awardee's proposal amounting to a reservation of the right to seek a price adjustment, where the awardee did not state it had a right to receive such an adjustment; and (iv) by omitting any argument concerning alleged prejudice in its motion for judgment  on the administrative record, the plaintiff waived all such arguments, and, therefore, had not established prejudice. 

In Telesto Group, LLC an unsuccessful protest of the prototype phase of the Enterprise Business System-Convergence Program initiated under the Army’s “other transaction” (OT) authority pursuant to 10 U.S.C. § 4022 to develop a solution to consolidate five Army business systems and improve their efficiency, the court held that this OT program became one in connection with a proposed procurement (over which the court has Tucker Act jurisdiction pursuant to 1491(b)(1)) when the Army completed the prototyping process and determined both that the process was successful and that the Army would acquire the successful prototype through a follow-on production contract. Having established jurisdiction, the court: (i) denied the protester's claim that the Army had violated 10 U.S.C. § 4022(d)(1)(A) (which allows a DoD component to use an OT when "[t]here is at least one nontraditional defense contractor [NDC] or nonprofit research institution participating to a significant extent in the prototype project" [emphasis added]) because there was a rational basis for the agency's conclusion that, in the aggregate, numerous of the awardee's NDC subs would contribute significantly to the project; and (ii) denied the  plaintiff's challenge to agency's amendment lowering the  standards in an evaluation criteria for one stage of the OT because (a) the principles of Blue & Gold Fleet should extend to OTs, and the plaintiff failed to challenge the amendments when they occurred, and (b) the amendments lowered the standards for both competitors and, thus, treated the competitors equally, which meant the plaintiff could not show prejudice.

In Kropp Holdings, Inc., a successful post-award protest, the court was faced with a situation where (over a significant period of time during corrective actions) the agency repeatedly gave the awardee unwarranted chances to correct deficiencies in its proposal. The court held, inter alia, that: (i) the agency improperly accepted the awardee's untimely proposal; (ii) the agency conducted misleading discussions with the protester and treated the competing proposals unequally; and (iii) the agency irrationally attributed the awardee's corporate experience and past performance to a completely walled-off division created by the awardee to compete for the contract and relied on those flawed attributions in awarding the contract.  

In Red River Science & Technology, LLC, an unsuccessful preaward protest, the court of Federal Claims held, inter alia, that: (i) even if another offeror's GAO protest were untimely, the agency was not precluded from declining to assert that defense and instead could choose to take corrective action by opening discussions based on that protester's allegations in order to improve the procurement; and (ii) even though the solicitation provided that "tak[ing] exception" to a  rate-capping process "will render the Offeror’s proposal unacceptable" and that the proposal "will not be further considered for award," the agency was not precluded from including such an unacceptable proposal when it decided to open discussions; and (iii)  where the agency already had determined the plaintiff's indirect rates were sufficiently supported, conducting discussions only with other offerors  whose proposals needed further support did not amount to unequal discussions.

In  ITegrity, Inc., an unsuccessful post-award protest by the incumbent, the court held that in accordance with the solicitation's Past Performance evaluation scheme, the agency (a) properly considered the two (of three) plaintiff's references the agency found relevant, (b) did not penalize the plaintiff for the reference found irrelevant, (c) evaluated the two relevant references as a whole, including subcontracts, and (d) was not required to limit its evaluation to the single most relevant reference submitted by the plaintiff (its incumbent contract), especially where the current solicitation exceeded the prior contract in scope and complexity. The court found that, in any event, the plaintiff was not prejudiced by the Past Performance evaluation adjectival rating because the best value trade-off specifically found the awardee's Past Performance submission to be superior, and the plaintiff's lower price was evaluated (as the solicitation required) as significantly less important than Past Performance:

In reviewing an evaluation of past performance information in a negotiated procurement, "the greatest deference possible is given to the agency – what our Court has called a 'triple whammy of deference.'" Gulf Group Inc. v. United States, 61 Fed. Cl. 338, 351 (2004) (quoting Overstreet Elec. Co. v. United States, 59 Fed. Cl 99, 117 (2003)) 

Sole Source/Small Business/Restricted Competitions

In WP Health Consulting, LLP, an unsuccessful protest, the court held that in eliminating the plaintiff from a competition by finding its proposal was not ranked high enough to merit inclusion in the competitive range in Phase II of the competition, the agency was not required by FAR § 19.601(c) and 13 C.F.R. § 125.5 to submit the proposal to the SBA for a CoC determination because the agency did not evaluate the offer on a "non-comparative" (e.g., pass/fail, go/no go, acceptable/unacceptable) basis, and, in any event, the plaintiff was not prejudiced because it was the lowest ranked offer among all those that had made it to Phase II before the agency selected the competitive range, and it failed to explain how its relative standing among the offerors would have improved had the SBA issued a CoC.

In Daniels Bldg. Co., an unsuccessful protest of a prior SBA OHA decision, the court upheld the OHA's finding that the challenged SDVOSB member of a team performing a construction contract would not violate the ostensible subcontractor rule because it would  perform the primary and vital requirements of the contract, which, in the case of construction contracts, are "the management, supervision and oversight of the project, including coordinating the work of various subcontractors, not the actual construction work performed." 13 C.F.R. § 121.103(h)(3)(iv). The court also held that: (i) the issue of whether the contractor was unduly reliant on its team member/sub was properly before the OHA; and (ii) its analysis of that issue was unobjectionable. 

In Hydraulics Int'l, Inc., an unsuccessful preaward protest mainly alleging deficiencies in the agency's market research, the court declined to issue a preliminary injunction against a proposed sole-source award for helicopter aviation ground power units, finding that the plaintiff was unlikely to succeed on the merits because it had failed to provide sufficient evidence that its units could meet the solicitation's requirements or that it had the production capability to provide compliant units within the required time frame. 

 

Responsiveness/Late Bids

 

Corrective Action/Stay Pending Protest

In Zolon PCS II, LLC, an unsuccessful protest of corrective action, the court held that, during corrective action, the agency's amendment of a solicitation to incorporate a recent revision of FAR § 52.204-7 (which eliminates the requirement that offerors have a continuous SAM registration from the time of offer through award) was authorized by  FAR 1.108(d)(2) because the agency intended to make new awards after the amendment, and the amendment was not "impermissibly retroactive."  The protester had won an earlier protest against the agency's first try, which was to incorporate a deviation of the prior FAR rule in order to permit offerors that otherwise would have been disqualified by a lapse in their registrations to continue to compete. 

In MVL USA, Inc., et al., the court denied the consolidated protesters' motion for a permanent injunction because the Government's corrective action (in response to a prior successful protest) followed the court's recommendation and eliminated the requirement for a project labor agreement in all the protested solicitations either by deleting the requirement or by canceling the procurement, rendering the protests moot. The protesters had essentially been asking the court to enjoin the procuring agencies from making the same mistake again on future procurements.  

In Kropp Holdings, Inc., a successful post-award protest, the court was faced with a situation where (over a significant period of time during corrective actions) the agency repeatedly gave the awardee unwarranted chances to correct deficiencies in its proposal. The court held, inter alia, that: (i) the agency improperly accepted the awardee's untimely proposal; (ii) the agency conducted misleading discussions with the protester and treated the competing proposals unequally; and (iii) the agency irrationally attributed the awardee's corporate experience and past performance to a completely walled-off division created by the awardee to compete for the contract and relied on those flawed attributions in awarding the contract. 

In Culmen Int'l, LLC, after the plaintiff had agreed to a dismissal without prejudice to permit the Government to undertake corrective action, the court denied the plaintiff's motion to keep the protective order in place to make protected materials available in case the plaintiff had to challenge the results of corrective action, holding that, on the particular facts of this case, such an order was not necessary:

Finally, this Court agrees with the government that “Culmen fails to explain . . . why protected materials obtained during this litigation might be necessary to substantiate a future challenge, during which the same materials would be available to the protestor to the extent relevant to the facts alleged.” [citation omitted]  Given that concession by the government — and the Court appreciates the government’s candor — the likelihood of any prejudice to Culmen is minimal. Depending on the contours of any future protest claims, the government indeed will have to provide the same materials, anyhow.  

Conflicts of Interest/PIA

In Marathon Targets, Inc., an unsuccessful (and unusual) post-award protest, the plaintiff requested a preliminary injunction, claiming that the agency's OCI investigation (which had resulted in its post-award disqualification from the competition) was procedurally and substantively flawed. That investigation had resulted in the conclusion that the plaintiff (a) had used source selection sensitive information inadvertently disclosed to it by the Contracting Officer to file an SBA protest and (b) had failed to indicate it would  take all the mitigation steps requested by the Contracting Officer in using that information in this CoFC protest. The court found that the four-hour time limit the agency gave the plaintiff to respond to the agency's final OCI report was not violative of due process because, inter alia, (a)  the plaintiff had had plenty of time to respond to the agency's concerns over the prior weeks (and had done so), (b) those were the same concerns raised in the report, and (c) the plaintiff did not establish what additional information it could have provided had it been given additional time to respond. Substantively, there were ample examples of conduct by the plaintiff after it received the inadvertent disclosure to support the OCI investigation's conclusion that there was an appearance of impropriety.

In Loyal Source Government Services, LLC, an unsuccessful preaward protest by the incumbent in a solicitation for medical services at the Border, the court held that in compliance with FAR § 3.104-7, the procuring agency (Customs and Border Protection or "CBP") took appropriate steps to address an alleged Procurement Integrity Act violation by quickly determining that the violation (improper disclosure of evaluations of the offeror's proposal) had occurred, pausing the procurement, and transferring the procurement from CBP to DHS, with entirely new personnel, which insured that the disclosures would not taint the procurement. The court also held that the CBP did not have to conduct PIA investigations of letters sent to Congress that the protester alleged showed bias by CBP officials against it because the procurement already had been transferred to DHS and bias is not a PIA violation.  

EAJA/Fees/Costs

Miscellaneous

In CAN Softtech, Inc., the court denied the plaintiff's motion to reconsider the court's earlier opinion largely denying the plaintiff's motion to require the Government to provide additional documents allegedly needed to complete the Administrative Record because, inter alia: (i) pre-decisional deliberative process records are not properly part of the Administrative Record and, therefore, need not be identified in a privilege log; and (ii) the plaintiff had not provided sufficient evidence to overcome the presumption of regularity in the Government's compilation of the  Administrative Record. The decision included cogent arguments by both sides concerning the applicability of both CAFC precedent and precedent from other jurisdictions, so I'm guessing eventually the CAFC will have to weigh in to clarify the standards to be applied in this area.

In Competitive Innovations LLC, the court denied the plaintiff's motion to supplement the Administrative Record, holding that materials from a prior (allegedly identical) procurement (which allegedly showed the agency applied a standard inconsistent with the one used in the protested procurement) were irrelevant because each procurement stands on its own, and the prior materials were not necessary for the court to evaluate the current protest. The court also denied a request to complete the Administrative Record with the same materials because the plaintiff failed to provide "clear evidence" that the current record was incomplete when the plaintiff alleged only that "the record is not complete because [it] does not contain an explanation for" how the agency evaluated the disputed element. In CAN Softtech, Inc., after an in camera review, the court required the Government to complete the Administrative Record by filing a draft memorandum (redacted to exclude portions protected by the attorney-client or deliberative process privileges) referenced in a decisional document already in the Administrative Record regarding potential Procurement Integrity Act violations, even though the deliberations concerning those violations were not issues in the protest, because those deliberations might help explain the time the Government took to decide to terminate the contract and issue a new solicitation.  

In IntelliBridge, LLC, an unsuccessful preaward protest, the court held that the challenged solicitation did not violate 41 U.S.C. § 3307(b)'s requirement that a federal agency, "to the maximum extent practicable," define the products or services it is seeking in a manner that allows for the procurement of "commercial services or commercial products or, to the extent that commercial products . . . are not available, nondevelopmental items" because, in this case, the agency was not soliciting a software product that would replicate the functionality of a specific existing product through a developmental solution, but rather was soliciting an expansive set of cloud and IT services. Subsequently, the court denied the plaintiff's request for reconsideration.  

In The QED Group LLC d/b/a Q2 Impact, a successful protest against the plaintiff's disqualification from the OASIS+ competition, the court undertook a detailed statutory analysis to conclude that section 889(d)(2) waivers issued by the Director of National Intelligence (under his authority to waive the prohibition in Section 889 of the John S. McCain NDAA for FY 2019 against using telecommunications equipment or services  provided by Chinese-government-owned companies) are not limited to a single contract or a single entity, as opposed to waivers issued by agency heads under section 889(d)(1) of that statute, which are specific to the requesting entity and are time-limited.  

In an unsuccessful preaward protest by Loyal Source Government Services, LLC, the court held that: (i) the agency's removal of staffing estimates from the solicitation was an appropriate response to a prior protest and did not prevent offerors from formulating intelligent offers; (ii) where there were different state licensing laws concerning how many personnel a physician may supervise, the agency (a) was not allowed to preempt state laws by establishing a single requirement in the solicitation and (b) could properly place the burden of determining choice-of-law questions concerning state licensing requirements on offerors; (iii) contrary to the protester's contention, the solicitation was not ambiguous as to the required presence of regional supervisors at various medical units; and (iv) although the solicitation's requirement that offerors provide wage and health and welfare rates with their proposals violated the FAR, which only requires such information from contractors (i.e., post award), the plaintiff could not show prejudice because the solicitation made clear that the data would not be used in the evaluation, and the plaintiff's only grounds for its protest was is its speculation that the data might be improperly disclosed.  

In Westwind Partners LLP, et al., the court denied motions to supplement and to complete the Administrative Record in a protest involving a solicitation with two functional categories of awards in order to show disparate evaluations of identical proposals in the two categories because the solicitation made it plain that such a situation could occur, and the two categories were evaluated by different evaluators.

In Telestro Group, LLC, an unpublished decision on preliminary issues in the case discussed in the June 3 entry below, the court denied all the plaintiff's motions to supplement and complete the administrative record because, inter alia: (i) declarations designed to support allegations that the agency's conduct of the procurement was arbitrary and capricious were not necessary where the court lacked jurisdiction in this instance to review that conduct under an arbitrary and capricious standard; (ii) a declarant's understanding of the meaning of the 10 U.S.C. § 4022(d)(1)(A), which requires that "at least one nontraditional defense contractor or nonprofit research institution participat[e] to a significant extent" in the project [emphasis added] was not necessary for effective judicial review; and (iii) declarations and evidence related to the agency's decision to amend the solicitation to lower the evaluation standards were unnecessary where the plaintiff had waived that claim and has not shown prejudice.  

The court dismissed a protest by American Tech Solutions, LLC for failure to prosecute in a decision that will not add anything to well-established law but is a cautionary tale of the importance of following procedural rules:

After filing its complaint, American Tech moved for entry of a protective order, which the court granted. American Tech struggled to comply with the protective order, publicly filing documents that contained protected material several times. The court repeatedly warned American Tech of its violations. Then, after further violations, the court issued a show-cause order directing American Tech to comply with the court’s rules and requiring American Tech’s counsel to show cause for why he should not be sanctioned for earlier failures to comply. 

While the show-cause order was pending, American Tech failed—three times—to timely request an extension of time to file its motion for judgment on the administrative record. When it belatedly requested those extensions, American Tech did not seek the defendants’ positions, in violation of this court’s rules. American Tech’s counsel attributed his failures to file to his having to address the problems with complying with the protective order and to computer failures. The court ordered American Tech to file its motion for judgment on the administrative record by March 13, 2025, and stated that no further extensions of the deadline would be granted. American Tech did not file its motion or request an extension of time to file the motion by the deadline. Thus, the court sua sponte dismissed American Tech’s complaint without prejudice for failure to prosecute under rule 41(b) of the Rules of the Court of Federal Claims.

Mercifully, the dismissal was without prejudice.  

 

 

Court of Appeals for the Federal Circuit

Jurisdiction/Standing

In Associated Energy Group, LLC, dba AEG Fuels, the CAFC affirmed the prior CoFC decision dismissing a protest against a bridge contract because, although the expiration of the bridge contract did not render the protest moot, the plaintiff lacked both Article III standing (because it could not meet a material requirement of the solicitation) and statutory (Tucker Act) standing (because even if all the alleged errors in the procurement were remedied as requested by the protester, it still would not have a substantial chance of award and, thus, did not have a substantial economic interest in the procurement).

Solicitation Language

I

Evaluations

I.  

Small Business Issues/Set-Asides

 

 

 

SBA Office of Hearings and Appeals

Jurisdiction/Standing/Timeliness/Procedure

In Size Appeal of Team CSI Joint Venture, LLC, the OHA held that the Area Office had correctly dismissed (as untimely) a size protest of a task order award under a long-term IDIQ MAC contract because the Contracting Officer had not requested size recertification in connection with the task order solicitation.  

In Size Appeal of MicroTechnologies, LLC, the OHA dismissed (as premature) an appeal seeking a firm's recertification as a small business because there was no indication the firm previously had sought recertification from an Area Office or that an Area Office had issued a decision on such a request. (The firm had submitted a request to the GSA in conjunction with the VETS 2 Governmentwide Acquisition Contract asking that it be "reinstated and be able to pursue VETS 2 opportunities" and had assumed, incorrectly, that the GSA's denial of that request was appealable to the OHA.)

In Size Appeal of Marathon Targets, Inc., the OHA affirmed the dismissal of a protest for lack of standing because the protester had been eliminated from consideration for award for procurement-related reasons (here, an organizational conflict of interest, an appearance of impropriety, and an unfair competitive advantage), even though that determination had not been made until well after the size protest was initially filed. The protester argued that the following regulation meant that standing should be determined as of the date of filing (and that is what the language clearly seems to suggest), but the OHA rejected the argument (probably because it would lead to an illogical result): "[T]he following entities may file a size protest in connection with a particular procurement, sale or order: (i) Any offeror that the contracting officer has not eliminated from consideration any procurement-related reason. . . ." 13 C.F.R. § 121.1001(a)(1)(i) (italics added).

The OHA dismissed the Size Appeal of Fiber Business Solutions Group, Inc. d/b/a GForce because neither an Area Office nor the OHA has jurisdiction over a challenge to an awardee's 8(a) eligibility, even when the appellant tries to label it as a size protest.  

The SBA's OHA dismissed the NAICS Appeal of Veterans Command, LLC because the OHA lacks jurisdiction over a protest alleging that a solicitation should have been set aside especially for SDVOSBs rather than just small businesses generally, especially a protest styled as a NAICS appeal that does not challenge the NAICS code assigned to the solicitation.  

In VSBC Appeal of Force99 Technologies, LLC, the OHA dismissed an appeal of the denial of a firm's application for certification as an SDVOSB because, inter alia, the appeal was filed a year later than the required 10 days from the date of the denial.

In VSBC Protest of Airborne Medical, LLC, the OHA dismissed a protest of a firm's SDVSB status because the protest failed to follow OHA's procedural requirements in several respects (including its lack of specificity), and the protester failed to respond the the OHA's show cause notice concerning those defects.  

In Size Appeal of Tribologik Corp., the OHA affirmed the dismissal of a size protest because it was initially filed five days late (and the  Contracting Officer's alleged advice could not override the controlling regulation concerning timeliness), and it was insufficiently specific (alleging only that the protested firm was related to another unnamed entity and failing to provide evidence that the combined receipts of the firms would exceed the applicable size standard).

In Size Appeal of Solvet Services, LLC, the OHA held that the Area Office had erred in dismissing a size protest as insufficiently specific despite the fact that it provided specific evidence of the protested firm's receipts, which exceeded those allowable by the applicable size standard. 

Ostensible Subcontractor

In Size Appeal of Kupono Government Services, LLC, the OHA held that the  Area Office was correct in finding no violation of the ostensible subcontractor rule because: (i) the primary and vital contract requirements in a solicitation for management and operations of the DOE's National Training Center in Albuquerque, New Mexico (issued prior to the "safe harbor" rule at 13 C.F.R. § 121.103(h)(3)(iii) became effective (which would only have required the prime to agree to the "Limitations on Subcontracting" provision)), were management services and oversight duties rather than "training" as alleged by the appellant: (ii) the challenged firm would self-perform and control most of the contract's managerial positions,  most of the labor hours under the most important of the three contract CLINs, and all of the work under the other two; and (iii) none of the four requirements for a finding of undue reliance on a subcontractor (the prime had two subs) was satisfied. The OHA noted it was irrelevant that the agency had not discussed the primary and vital requirements in detail in a second size determination issued after corrective action because the solicitation had not changed since the original size determination, which had discussed those requirements.

In Size Appeal of Osang, LLC, the OHA held that although the Area Office had used wrong date to assess a firm's compliance with the ostensible subcontractor rule, that was harmless error because the firm fell under the safe harbor provision of 13 C.F.R. § 121.103(h)(3)(iii) by demonstrating that it would comply with the limitations on subcontracting provisions set forth in 13 C.F.R. § 125.6. 

In Size Appeal of Bowhead Enterprise, Science, and Technology, the OHA noted that the recent revision to 13 C.F.R. § 121.103(h)(3)(iii) establishes that when a small business together with all its small business subcontractors will comply with the limitations on subcontracting provisions, that is sufficient to avoid application of the ostensible subcontractor rule:

To circle back to the revised rule, the standard is now that of a brightline rule, where in respect to a services, specialty trade construction, or supply contract:"SBA will find that a small business prime contractor is performing the primary and vital requirements of the contract or order, and is not unduly reliant on one or more subcontractors that are not small businesses, where the prime contractor can demonstrate that it, together with any subcontractors that qualify as small businesses, will meet the limitations on subcontracting provisions set forth in § 125.6 of this chapter.” 13 C.F.R. § 121.103(h)(3)(iii), (emphasis supplied). SBA itself also noted during the issuance of the rule that it “believe[d] that meeting the applicable limitation on subcontracting requirement is sufficient to overcome any claim of the existence of an ostensible subcontractor." 88 Fed. Reg. 26,164, 26,166 (Apr. 27, 2023), (emphasis supplied). 

 

Other Affiliation Issues

In Size Appeal of Hometown Veterans Medical LLC, the OHA held that, pursuant to 13 C.F.R. § 121.103(h), the members of a joint venture were affiliated by virtue of having submitted an offer more than two years after the award of the first contract to the joint venture even though the initial award was terminated for convenience prior to performance (so that the JV did no work and received no benefit).

In Size Appeal of Acacia 7, which has a lengthy procedural history, the OHA held that a mentor-protégé joint venture agreement was deficient in terms of control by the protégé because it created two entities in addition to the small business Responsible Manager contemplated by the regulations: a Program Manager with (almost) equal authority to the Responsible Manager and an Executive Committee with oversight over both the Responsible Manager and the Program Manage and comprised of one member each of the mentor and protégé so that the mentor had negative control.  

 Other Miscellaneous Size Issues

In Size Appeal of The Povolny Group, Inc., the OHA affirmed the Area Office's dismissal of a size protest against a mentor-protégé JV as nonspecific because the protester acknowledged that the protested firm was a joint venture between an SBA-approved mentor and protégé, and that its protégé member was a certified SDVOSB, alleging only that the firms were generally affiliated, due to the ratio between contracts awarded to three mentor-protégé ventures as compared with contracts awarded to the protégé in its individual capacity, which is to be expected because, in accordance with 13 C.F.R. § 125.9(a), the mentor is supposed to provide assistance to the protégé in performing prime contracts with the Government through joint venture arrangements.

In Size Appeal of Chenega Base and Logistics Services, LLC, the OHA upheld the appeal in a size protest concerning an 8(a) set-aside procurement because, pursuant to 13 C.F.R. § 121.103(h)(2)(i), the Area Office should have examined the protester's contention that an 8(a) joint venture agreement failed to comply with the requirements for such agreements at 13 C.F.R. § 124.513(b) and (c).

In Size Appeal of Acacia7 JV, although the appellant lost on many of its allegations of affiliation, it ultimately prevailed when the OHA held that a mentor-protégé joint venture agreement (JVA) of the challeged firm did not comply with 13 C.F.R § 125.8 because the Responsible Manager designated by the small business was subject to oversight and control by an Executive Committee comprised of one member each from the mentor and the protégé whose decisions must be unanimous and because the Responsible Manger shared authority with a Program Manager that was an employee of the mentor. The OHA also found that the JVA did not comply with 13 C.F.R. § 125.8(b)(2)(viii), which requires the JVA to have a provision obligating all parties to ensure performance of the contract and to complete performance despite withdrawal of a member.  

In Size Appeal of DecisionPoint-Agile Defense JV, LLC, the OHA held that, in finding a joint venture other than small, the Area Office had incorrectly limited its review to the firm's joint venture agreement (JVA) instead of examining both the JVA and Operating Agreement together. 

In Size Appeal of Secise, LLC, the OHA held that the 180-day period at 13 C.F.R. § 125.12(e)(2)(i) (formerly, 13 C.F.R. § 121.404(g)(2)(iii)) for determining whether a small business has undergone a merger or acquisition that renders it ineligible for award in a particular procurement begins to run from the date of the initial offer and does not restart at the date of any subsequent offers. 

In Size Appeal of Advanced Information Systems Group, Inc., the OHA held that a virtual business incorporated in the United States that does not conduct business in a physical location but does business and delivers the services it sells online, which is owned by Americans and employs Americans residing in their homes from which the online services are delivered in the United States has a "place of business located in the United States" pursuant to 13 C.F.R. § 121.105(a)(1).

In Size Appeal of BahFed Corp., the OHA affirmed the Area Office's dismissal of a size protest as nonspecific because the protester's allegation was that the number of "Associated Members" on the challenged firm's LinkedIn page exceeded the number of employees in the applicable size standard when, as the protester conceded, Associated Members on LinkedIn are not necessarily limited to employees. Then, in HUBZone Appeal of BahFed Corp., which involved the same challenger, the same challenged firm, and the same procurement, the OHA denied an appeal of a determination that the challenged firm was a qualified HUBZone firm for this procurement because the rule that a firm's HUBZone status is to be determined as of the submission of its initial proposal in a two-step procurement is not limited to certain types of two-step procurements or which section of the FAR the solicitation is being conducted under and also is not limited to the submission of a priced proposal. The challenged firm's submission of its initial proposal in this two-step procurement was within one year of its certification as a HUBZone firm, as required by the regulations. 

In Size Appeal of Veteran Elevated Solutions, LLC, the OHA held that a firm was other than small for the procurement because it did not meet two of the four requirements of the statutory nonmanufacturer rule (15 U.S.C. § 637(a)(17)(B)): (i) it did not qualify as a small business concern under the numerical size standard for the Standard Industrial Classification Code expressly assigned to the solicitation (in this case, 500 employees); and (ii) it would not supply the product of a domestic small business manufacturer (in this case the items would come from the Korean parent company).  

 

8(a)/VSBC/SDVOSB/CVE/WOSB Status/HUBZone

In VSBC Protest of Data Monitor Systems, Inc., the OHA denied a challenge to a firm's SDVOSB status because: (i) two of the three members of the LLC were SDVs whose "Voting Block" was required for (a) a quorum and (b) all significant decisions pursuant to the Operating Agreement, which established the requisite control by SDVs; (ii) a qualifying veteran held the highest position in the firm; (iii) the fact that a non-SDV was the company's registered agent did not diminish the control by the two SDVs; (iv) the fact that the SDVs worked at a subcontractor owned by the non-SDV member was not disqualifying because the subcontractor's involvement was not crucial to the SDVOSB's ability to conduct business, and, thus, the SDVs could exercise independent business judgment without economic risk; (v) the SDVs' employment at the sub did not violate the general rule that qualifying vets must work full-time during normal business hours at the SDVOSB because the record established that the SDVs had ultimate managerial authority under the Operating Agreement; and (vi) the protester failed to provide any credible evidence in support of its allegation of a violation of the ostensible subcontractor rule, especially where the protested firm established it would comply with the "limitations on subcontracting" requirement.

In VSBC Protest of Winergy, LLC, the OHA held that, in a solicitation to inspect and certify ventilation equipment at a VA facility, the challenged SDVOSB violated the ostensible subcontractor rule because its proposal did not reflect (a) that the firm would self-perform any portion of the work with its own employees, (b) that any of its employees would be involved with the contract, or (c) that its employees possessed the certification required to perform the contract work.

In BDPE Appeal of iZen ai Inc., the OHA upheld a decision denying admission to the  8(a) program due to lack of economic disadvantage because the owner's tax returns showed income exceeding the $400,000 threshold, including funds withdrawn from an IRA for personal use, and the allegation that those funds were subsequently stolen was irrelevant.

In VSBC Protest of Veteran Military Contracting, the OHA sustained a protest against the SDVOSB status of a competitor in an SDVOSB set-aside because the challenged firm conceded it was not a certified SDVOSB and claimed it had mistakenly checked the box indicating it was an SDVOSB on the solicitation form.

In Matter of The CTS Group LLC, relying on the holding in Ultima Servs. Corp. v. U.S. Dep't of Agric., et al., 683 F. Supp. 3d 745 (E.D. Tenn. 2023), which held that the rebuttable presumption at 13 C.F.R. § 124.103(b) (that individuals who are members of certain minority groups are presumed to be socially disadvantaged for purposes of the 8(a) program) violates due process, the OHA upheld a firm's termination from the program because, in multiple submissions, rather than showing "chronic" social disadvantage, the firm provided only two examples of alleged discrimination towards its owner, neither of which was clearly attributable to bias rather than legitimate, non-discriminatory reasons, and the SBA was not required to provide the firm with additional opportunities to revise its submission.

In VSBC Protest of Seventh Dimension LLC, an unsuccessful protest, the OHA held that the fact that the challenged firm was not listed in the VetCert database was irrelevant because it was certified in the SBA's new system (MySBA Certifications) and was listed  as SDVOSB-certified in the new DSBS database (to which the SBA was transitioning). The OHA also held that the facts belied the protester's unsupported and speculative contentions (a) that the challenged firm was affiliated with another firm or that a conflict of interest existed (neither of which would be grounds for a status protest such as this one anyway) and (b) that the challenged firm was unduly reliant on a subcontractor.

In HUBZone Appeal of BahFed Corp., the OHA denied an appeal of a determination that the challenged firm was a qualified HUBZone firm for this procurement because the rule that a firm's HUBZone status is to be determined as of the submission of its initial proposal in a two-step procurement is not limited to certain types of two-step procurements or which section of the FAR the solicitation is being conducted under and also is not limited to the submission of a priced proposal. The challenged firm's submission of its initial proposal in this two-step procurement was within one year of its certification as a HUBZone firm, as required by the regulations.  

In HUBZone Appeal of CS Government Solutions, LLC,  the OHA  noted that, in determining whether a firm seeking HUBZone status has the requisite number of employees, OHA looks beyond payroll records to the totality of the circumstances, and here there was not sufficient work product to indicate that the challenged individuals had actually worked for forty hours in the four weeks preceding the date of review, as required by the regulations at 13 C.F.R. § 126.501(a) in effect as of the date of this determination.

NAICS

In NAICS Appeal of The Red Gate Group, LTD, the OHA held that the appellant lacked standing to appeal the NAICS code for task order solicitation limited to a pool of contractors of which the appellant was not a member.

In NAICS Appeal of Peerless Technologies Corp., which involved a solicitation for advisory services and assistance to the Air Force Research Laboratory's RDT&E  projects, the Contracting Officer's choice of NAICS-541611 ("Administrative Management and General Management Consulting Services") was more  appropriate than the appellant's choice of NAICS-541715 ("Research and Development in the Physical, Engineering, and Life Sciences") because, inter alia, whether a particular code is superior for maximizing competition is irrelevant in a NAICS appeal.

In NAICS Appeal of MissionAnalytics, which involved a solicitation to procure security cameras and related equipment for VA medical centers, the OHA rejected the Contracting Officer's choice of NAICS-561621 ("Security Systems Services (Except Locksmiths)") because the contract was primarily for manufactured items, and chose instead NAICS-334220 ("Radio and Television Broadcasting and Wireless Communications Equipment Manufacturing").

In NAICS Appeal of ARMADA, Ltd., where the principal purpose of the contract was to obtain assistance with Personnel Security, which, according to the OHA, was best described as involving administrative support services, the Contracting Officer's choice of NAICS 561110 ("Office Administrative Services") was preferable to any of the appellant's suggestions, including NAICS 561611 ("Investigation and Personal Background Check Services"). 

 


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