Protest challenging the agency’s technical evaluation, cost realism analysis, and best value tradeoff is denied. The protester contended that the technical evaluation was flawed because the agency did not find the awardee’s lack of experience risky and consequently did not properly credit the awardee for its experience as incumbent. But GAO found that there was no requirement that offerors receive more credit for their experience as in incumbent. As to cost realism, the protester complained about the lack of documentation supporting the realism analysis and about cost adjustments made to the awardee’s proposal. GAO, however, found that the realism analysis was adequately documented and that the adjustments to the awardee’s price were reasonable. Finally, GAO determined that the best value tradeoff was fine; the agency reasonably found that the protester’s higher-rated proposal was not worth its significant price premium.
The Navy issued a solicitation seeking a contractor to develop and maintain a combat management system for its ships. Raytheon, the incumbent, and Lockheed Marin submitted proposals in response to the solicitation. The Navy found that Raytheon had a higher-rated proposal but Lockheed had a lower price. The Navy awarded the contract to Lockheed, finding that Raytheon’s technical superiority did not justify its higher price. Raytheon protested, challenging the Navy’s technical and price evaluations as well as the best value analysis.
Raytheon first claimed that the Navy misevaluated Lockheed’s technical approach. Raytheon argued that Lockheed’s lack of experience increased the risk of performance, schedule, and costs. The crux of the Raytheon’s argument was that Lockheed could not offer the same advantages as Raytheon’s incumbency. But GAO found this argument unavailing. The RFP did not require offerors to have specific experience with ship defense systems. Moreover, an evaluation is not unreasonable simply because a protester believes that its incumbency status entitles it to higher ratings. There was no requirement that offerors be given more credit for incumbent status.
Raytheon also objected to the evaluation of its proposal under a data rights factor. The solicitation advised that offerors should provide technology with government purpose rights or better. Raytheon believed it should have received additional strengths for offering unlimited rights. GAO noted that the Navy had already acknowledged that Raytheon’s unlimited rights offered an exceptional approach and warranted an Outstanding rating. Thus, the Navy was aware of the benefits of Raytheon’s proposal. GAO did not believe the agency had abused its discretion by not finding Raytheon’s approach even more impressive.
Next, Raytheon contended that the Navy’s cost realism analysis lacked sufficient documentation because it did not provide the specific calculations used to arrive at the most probable cost. But GAO found that the cost realism analysis was well-documented. The analysis included detailed charts of adjustments to hours and labor rates, and it set forth the Navy’s methodology for adjusting proposed costs.
Raytheon further argued that cost adjustments made to Lockheed’s proposal were flawed and should have been greater. GAO disagreed, finding that the Navy adjusted rates to a realistic level based on historic rates and substantiating data provided in Lockheed’s proposal.
Raytheon also asserted that the Navy flubbed the realism analysis by failing to reassess Lockheed’s technical understanding after the cost adjustment. But GAO found= that the agency considered the adjustments to and risks associated with Lockheed’s proposal. The Navy was not required to document every single “determination of adequacy.”
Raytheon also complained about the best value tradeoff, arguing that the Navy improperly concluded that Raytheon’s strengths were offset by strengths in Lockheed’s proposal. But GAO found that this argument simply constituted disagreement with the Navy’s judgment. Arguments that the Navy should have valued Raytheon’s strengths more favorably do not demonstrate that the evaluation was unreasonable.
Additionally, Raytheon alleged that the Navy erred in finding that Raytheon’s approach under the data rights factor was equal to Lockheed’s. Again, GAO found that this argument constituted disagreement about the weight the agency assigned to proposed data rights and thus did not provide a basis to find the evaluation unreasonable.
Finally, Raytheon contended that the agency failed to give its technical discriminators the weight they deserved. But GAO found that the Navy reviewed and was aware of the relative merits of Raytheon’s technical discriminators. It simply found those discriminatorswere not worth the $48 million price premium, which GAO noted, is the essence of a best value tradeoff.
Raytheon is represented by Kevin P. Connelly, Kelly Buroker, Kirsten Konar, and Tamara Droubi of Vedder Price PC. The intervenor, Lockheed, is represented by Marcia G. Madsen, David F. Dowd, and Luke Levasseur of Mayer Brown LLP. The agency is represented by Per David Midboe, J. Gregory Lennon, and Kelsey A. Harrer of the Navy. GAO attorneys Lois Hanshaw and Amy B. Pereira participated in the preparation of the decision.
