Agency Told Protester that One of Its CLINs “Appeared High.” Should the Agency Have Said the CLIN was 15,000% Higher than the Awardee’s?

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The protester alleged the agency had conducted inadequate discussions when it failed to advise the protester that its price on a certain CLIN was 15,000% higher than the awardee’s. But GAO found the discussions were sufficient. The agency told the protester that its price was high. The agency was not required to disclose the magnitude of the price disparity between the protester and the awardee.

Wolverine Tube Inc. d/b/a Wolverine Industries, GAO B-418339.4, B-418339.5


The Air Force posted an RFP for the manufacture and delivery of next generation cargo pallets. Five offerors, including Wolverine Industries and AAR Mobility Systems, submitted proposals. The Air Force initially awarded the contract to Wolverine. Following a protest, corrective action, and reevaluation, the Air Force awarded the contract to AAR. Wolverine protested.


Price Reasonableness

Wolverine and AAR had proposed wildly different prices for a CLIN on first article costs. AAR had proposed $100,000 for the CLIN while Wolverine proposed almost $15 million. Given this disparity, Wolverine argued that the price reasonableness analysis had to be flawed.

But GAO found that Wolverine hadn’t really made a price reasonableness argument. Price reasonableness involves determining whether an offeror’s prices are too high. Wolverine did not argue that AAR’s price  was too high but only that it contained an error. GAO found this failed to state a valid basis of protest.

Unbalanced Pricing

Wolverine also argued the agency had failed to consider whether AAR’s pricing of the CLIN was unbalanced. But GAO reasoned that the primary risk to be assessed in unbalanced pricing is the risk posed by an overstatement of prices. Understated prices do not present the same risk. Thus, to prevail on a claim of unbalanced pricing, a protester must show that one or more prices is overstated—it’s not enough to show that some line items are understated. 

Here, Wolverine had only alleged that AAR’s price was understated. It had not shown that any of the prices were overstated. GAO also found that this argument failed to state a valid basis of protest.

Adequacy of Discussions

Wolverine alleged discussions were deficient. The Air Force had informed Wolverine that its $15 million price for the first article CLIN “appeared to be higher” than AAR’s. Wolverine argued these discussions failed to convey the obvious and highly significant disparity in prices.

GAO reasoned that when an agency conducts discussions concerning price, advising that offeror that its price is too high is generally sufficient. An agency is precluded from disclosing another offeror’s price. Thus, it would have been inappropriate for the Air Force to advise of the specific price disparity between offers. The Air Force identified Wolverine’s price as an issue through two rounds of discussions and clearly advised the company its price was too high. There was no requirement for the agency to say anything further.

Misleading Discussions Regarding COVID-19

Wolverine alleged the Air Force had misled the company during discussions to increase its price to account for the effects of COVID-19. GAO rejected this argument. The agency had asked offerors during discussions to take COVID-19 into consideration when preparing final proposals. There was nothing coercive about this that caused Wolverine to raise its price. Rather, the agency reminded offerors about the pandemic and left it to them to determine whether to raise prices. The discussions were not misleading just  because Wolverine made a business decision to raise its price that it later regretted.

Wolverine is represented by Bret S. Wacker and J. Christopher White of Clark Hill, PLC. The intervenor, AAR,  is represented by Paul R. Hurst, Amba M. Datta, and Caitlin T. Conroy of Steptoe and Johnson LLP. The agency is represented by Major Darren S. Gilkes, Colonel Frank Yoon, and Erika Whelan Rhetta of the Air Force. GAO attorneys Louis A. Chierella and Peter H. Tran participated in the preparation of the decision.

–Case summary by Craig Lachance, Senior Editor

GAO - Wolverine Tube Inc.