The protester challenged the agency’s decision to cancel a solicitation. The court, however, found that cancellation was justified. The agency had determined that its evaluation was indefensible—it lacked an explanation, did not cite evaluation criteria, and contained conclusory language. Moreover, the agency was concerned about a leak of procurement information that may have created an integrity issue. Under the circumstances, the court concluded that cancellation and a do-over was a rational course of action for the agency.
Harmonia Holdings Group, LLC v. United States, COFC No. 21-1704C
Background
The IRS posted a solicitation seeking to award a blanket purchase agreement for software application testing. After reviewing dozens of quotations, the IRS awarded BPAs to four offerors, including Harmonia Holdings Group.
Several unsuccessful offerors protested the awards. In response to the protests, the IRS took corrective action to reevaluate quotations. During the corrective action, IRS managment became concerned about the procurement. Management found that the evaluators had failed to adequately explain their findings, and that they had asked improper questions during an oral presentation. Additionally, management believed the source selection decision was not supported by the evaluation findings. What’s more, management had concerns that some of the evaluators were biased against one of the offerors.
In light of these issues, the IRS terminated the awards, canceled the solicitation, and reconvened a new evaluation team to start the procurement over.
Harmonia filed a protest with the Court of Federal Claims, objecting to the cancellation of the solicitation.
Court’s Analysis
Cancellation Was Justified
Harmonia contended that the cancellation decision was arbitrary and capricious. The court disagreed. The IRA had identified numerous problems with the procurement that would make any award difficult to defend if protested. Specifically, the ratings offered conclusions without explanations, the evaluation did not cite to the evaluation criteria or proposal, and the evaluation contained equivocal inconclusive language. It also appeared that the evaluators had asked inappropriate questions during oral presentations. The court declined to second guess the agency’s appraisal of its own evaluation.
Integrity Issues
The IRS had also decided to cancel due to concerns about integrity with the procurement. The agency was worried that procurement information had leaked from the agency. Harmonia thought these concerns were overblown, and that if the agency had really been concerned about integrity it would have investigated the issue earlier. Again, however, the court declined to wade into the minutiae of the procurement process to second guess the agency’s judgment.
Bias
The IRS maintained that it had to cancel due to concerns about the evaluators’ bias against an offeror. Harmonia argued that the record was devoid of facts indicating bias. The court agreed with Harmonia, reasoning that if bias had been the agency’s only reason for canceling, the cancellation would not have been justified.
Alternatives to Cancellation
Harmonia argued that cancellation was arbitrary because the IRS failed to consider other options short of cancellation. The court, however, found that the IRS had actually considered moving ahead with the procurement. In any event, the court reasoned that the existence of other other (or even better options) did not make the cancellation arbitrary. Under the APA, an agency is not required to address every conceivable option, so long as the option it does pick is reasonable. The court had already found that under the circumstances, cancellation was reasonable.