Agency Refused to Implement a GAO Recommendation. Did that Refusal Moot a COFC “Appeal” of the GAO Decision?

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GAO sustained protests arising out of the award of a Navy contract. GAO recommended the Navy reopen discussions and evaluate revised proposals. The awardee filed a protest with the COFC, alleging the GAO decisions were unreasonable. But while that protest was pending, the Navy informed GAO that it would not implement GAO’s recommendations. The COFC found that the decision not to implement mooted the awardee’s protest. The agency had essentially decided to stick with the awardee. As a result, the awardee was no longer an interested party and — through the agency’s rejection of GAO’s recommendation — the awardee had received the relief it sought in its protest.

L3 Technologies, Inc. Communications Systems-West v. United States, COFC 21-1819C

Background

The Navy issued a solicitation for the design and development of an aircraft jamming system. Two offerors, L3 Technologies and Northrop Grumman, submitted proposals. The Navy awarded the contract to L3, finding Northrop Grumman’s proposal unacceptable.

Northrop Grumman filed several protests with GAO. GAO sustained two of them. First, GAO found L3 had hired a former Navy official who had worked on the procurement. This created the appearance of a conflict of interest, which the agency failed to consider. Second, GAO found that the Navy should have found L3’s proposal unacceptable for failure to meet a threshold requirement. In both cases, GAO recommended the Navy reopen discussions and evaluate revised proposals.

L3 then filed a protest with the Court of Federal Claims. In its COFC protest, L3 alleged the GAO decisions were, for a variety of reasons, arbitrary and capricious. But after L3 filed its COFC protest, the Navy informed GAO that it would not be implementing GAO’s recommendations—i.e., reopen discussions, revised proposals—in the protests. Rather, the Navy essentially stated that it was sticking with its award to L3. Thereafter, the government and Northrop Grumman, which had intervened in L3’s protest, moved to dismiss L3’s protest.

Court’s Analysis

L3 Was No Longer an Interested Party

Generally, when the protester is the awardee of a contact, they lack standing to protest. The court found that in light of the Navy’s decision to not implement GAO’s recommendations, L3 was the awardee of the contract. The Navy had essentially decided to uphold its award to L3. As the awardee, L3 no longer had anything to protest.

Protest Was Moot

The court further reasoned that even if L3 was an interested party, its protest was now moot. The underpinning of L3’s protest was the concern that the Navy would follow GAO’s recommendation. The Navy had not followed the recommendation. There was nothing left for L3 to complain about.

L3, however, reasoned that Northrop Grumman had filed a protest to challenge the Navy’s decision to continue with the award to L3. L3 contended that the existence of this protest still posed a risk to the L3’s award, so L3’s protest was not moot. The court didn’t by this argument. The risk L3 worried about was the risk that the court would uphold Northrop Grumman’s protest. That risk, however, would arise from action taken by the court, not from any action taken by the Navy. The potential outcome of the Northorp Grumman’s protest was not enough for the L3’s protest to continue.

L3 is represented by Craig A. Holman, Mark D. Colley, Kara L. Daniels, Michael D. McGill, Thomas A. Petit, Trevor G. Schmitt, and Aime JH Joo of Arnold & Porter Kaye Scholer LLP. The intervenor, Northrop Grumman, is represented by Jason A. Carey, Kayleigh M. Scalzo, J. Hunter Bennett, Andrew R. Guy, Peter B. Terenzio II, and Paul Rowley of Covington & Burling. The government is represented by Steven M. Mager, Douglas K. Mickle, Patricia M. McCarthy, and Brian M. Boynton of the Department of Justice as well as by Therese M. Francis and Thy Nguyen of the Navy.

COFC - L3 Technologies