Protest challenging the agency’s decision to reevaluate proposals and make a new award decision in response to a protest is denied, where the protester knew that one of its key personnel was unavailable for performance and therefore engaged in an impermissible bait and switch when it submitted its final revised proposal. The protester knew that it had laid off a proposed key manager and that this individual had been hired by a competing offeror. Nonetheless, its proposal represented this individual as a current employee.
Conley & Associates Inc. protested the scope of the Army’s corrective action in response to a protest of the agency’s award to Conley of a contract for command, control, communications, computers, intelligence, surveillance, and reconnaissance support services. Conley argued that both the scope of the corrective action and the action itself were irrational.
The protest and corrective action involve the availability of a proposed key employee. Of the seven offerors who submitted proposals, three proposed to use the same individual for the key position of field service manager. At the time of proposal submission, this individual was employed by Conley.
The agency initially awarded the contract to Valkyrie Enterprises Inc. but Conley protested multiple times, delaying performance. During this time, Conley laid of the individual it proposed for field service manager and Valkyrie hired him. When contacted by Conley, the individual did not express any commitment or desire to return to the company, and did not provide a letter of commitment to work on the contract at issue nor consent to have his name connected to Conley’s proposal.
In resolving Conley’s second protest, the agency asked offerors to revalidate their original proposals. All three offerors who had proposed this individual affirmed him as their proposed field service manager. Conley’s proposal identified this individual as a current Conley employee, though other key personnel were identified as contingent hires.
After this corrective action, the Army awarded the contract to Conley. Notably, Conley received an outstanding rating for key personnel, with the Army noting that its key personnel were already on-staff or were contingent hires, and would be available on day one of the contract.
After award, Conley offered to rehire its terminated FSM but he declined. Conley then asked the CO for approval to replace its FSM. At the same time, Valkyrie protested the award, alleging that Conley had failed to inform the Army that its proposed FSM was not available. The Army concluded that Valkyrie’s challenge might have merit and decided to review the best value analysis and award decision. Conley protested this decision to take corrective action.
Conley argued the Army had no rational basis for concluding that Valkyrie’s protest grounds had sufficient merit to justify a corrective action. Conley noted that the solicitation allowed for post-award key personnel substitutions, that it intended to refute Valkyrie’s protest grounds, and that it did not act improperly in bidding on the contract.
However, the court found the Army’s decision had a rational basis. The government argued that Conley had engaged in a “bait and switch” with its key personnel, by proposing an individual that it knew was not available for performance. The court noted that Conley did proposed this individual and that the agency’s evaluation of key personnel relied on Conley’s representation that this individual was available. It was also undisputed that Conley asked to provide a substitute.
The fourth element of a bait and switch theory is whether it was foreseeable that the individual proposed in the contract would be unavailable. Conley argued that foreseeability requires that an awardee have actual knowledge that key personnel would be unavailable, but the government argued that negligence was sufficient to demonstrate a bait and switch.
The court agreed with the government, explaining that foreseeability requires that an offeror knew or should have know when it submitted its proposal that their proposed key personnel would be unavailable. The court also found that the unavailability of the proposed FSM was foreseeable. Conley had laid off the individual and he had refused an offer to reemployment. Conley also knew the individual worked for Valkyrie and that he had not committed to return to Conley should it win the contract. Conley did not ask the individual for authorization to use his name and resume in its proposal and did not execute any contingent hire letter.
Had the individual provided any definitive assurances, then Conley would have had strong evidence that his unavailability was not foreseeable. However, the court found it clear that Conley knew it was unlikely that he would perform on the contract. Nonetheless, Conley’s final revised proposal proposed him as FSM and identified him as a current employee. Though Conley may have assumed the individual would return to the company after award, it had no assurance that he would do so. Accordingly, the court held that Conley had engaged in an improper bait and switch and that the Army’s decision to take corrective action was rational.
Conley also argued that the solicitation permitted post-award key personnel changes. However, the court explained this language did not allow offerors to substitute individuals who were foreseeably unavailable. Because the court already determined that Conley had engaged in a bait and switch, it held that the solicitation language permitting substitutions did not apply. The court also rejected Conley’s assertion that it would have refuted Valkyrie’s allegations before GAO, as this had no bearing on the conclusion that the protester had engaged in a bait and switch.
Next, Conley complained that the Army’s corrective action is unfairly intended to preclude Conley from award, because the agency will not hold discussions or accept proposal revisions. Because the Army knows Conley’s field service manager is not available, Conley argued that its staffing could not be evaluated properly. Alternatively, Conley argued the Army had opened discussions when it removed the proposed FSM from its proposal and therefore it must allow proposal revisions.
However, the court found the agency’s decision not to hold discussions was within its discretion. Further, the proposed corrective action does not discriminate against Conley because no offerors will be allowed to revise their proposals and the agency will use the same evaluation criteria. To the extent Conley complained about competitors hiring its former employees, the court advised the protester to improve its ability to retain staff rather than complain to the court.
Finally, the court held that the Army did not open discussions. The Army did not “remove” Conley’s proposed FSM from its proposal, but intends to evaluate the proposal as submitted, with the knowledge that this individual is not employed by Conley and made no commitment to return. Rather, the corrective action will remove a defect introduced by Conley’s misrepresentation.
Conley & Associates is represented by Scott F. Lane, Katherine S. Nucci and Jayna M. Rust of Thompson Coburn LLP. Valkyrie Enterprises Inc. is represented by J. Bradley Reaves and Beth V. McMahon, ReavesColey, PLLC. The government is represented by Anthony F. Schiavetti, Trial Attorney, Joseph H. Hunt, Assistant Attorney General, Robert E. Kirschman, Jr., Director, Douglas K. Mickle, Assistant Director, Commercial Litigation Branch, Civil Division, Department of Justice, and by Scott N. Flesch, Chief, Bid Protests, and Major Sean Zehtab, Trial Attorney, Department of the Army.