Protest challenging the disqualification of a protester is denied where the protester omitted government-provided prices from its proposal. The solicitation instructed offerors to “please include” certain plug-in prices in their proposals. Contrary to the protester’s arguments, COFC found that the instruction to “please include” the plug-ins was not a suggestion; it was a requirement. The court also found that failure to include the plug-ins was a material omission that rendered the proposal ineligible, and that the agency did not breach its duty of good faith and fair dealing by rejecting the protester’s proposal.
Safeguard Base Operations, LLC bid on a contract to provide dormitory maintenance services at a Department of Homeland Security training center. After multiple GAO bid protests and corrective actions, DHS ultimately determined that Safeguard was ineligible for award because its price volume did not include government-provided prices for certain CLINs. Specifically, an amendment to the solicitation had instructed offerors to “[P]lease include the following ‘not-to-exceed’ amounts in the applicable CLIN.” Safeguard did not include the provided amounts; it simply left the applicable CLINs blank.
Safeguard filed a GAO protest, challenging the rejection of its proposal. GAO denied the protest. Safeguard then filed a protest with COFC, contending that its disqualification was arbitrary because the prices it omitted from its proposal were not required. The instruction to “please include” the prices Safeguard argued, was a mere suggestion, “precatory rather than mandatory.”
The awardee, B&O Joint Venture LLC, intervened. Safeguard moved for judgment on the administrative record. The government and B&O filed cross-motions for judgment on the administrative record. In addition, B&O moved to dismiss Safeguard’s complaint for lack of standing.
The court first addressed whether Safeguard was required to include the government-provided prices in its proposal. Safeguard pointed to language in the solicitation’s schedule of supplies and services that explicitly stated, “DO NOT SUBMIT PRICING FOR THESE CLINS.” The court, however, reasoned that this language had to be read in context. Offerors were instructed to not submit pricing for the CLINs because those CLINs were pre-priced by the government. Because the amounts were pre-priced, offerors did not need to submit their own pricing for them. This did not mean that offerors were supposed to leave the CLINs blank.
The court next considered whether the “please include” language in the amendment amounted to a suggestion. The court noted that the “please” in the instruction was used as an adverb to modify “include.” While “please” may indicate a “polite request,” the operative word here was “include,” which means to “put in.” The “please,” therefore, was a polite modifier of the imperative to “include.” The “please” did not turn the instruction into a suggestion. Rather, it was merely a well-mannered requirement.
Still, Safeguard argued the “DO NOT SUBMIT . . .” language in the schedule of supply and services still conflicted with the amendment’s instruction to “please include” the government prices. Under the solicitation’s Order of Precedence clause, any inconsistencies in the solicitation were resolved by giving precedence to the schedule of supplies and services over an addendum to the solicitation. The court was not persuaded. The “DO NOT SUBMIT” language instructed offerors to not submit their own pricing because the government would provide pricing for these CLINs. This did not conflict with the amendment, which provided the prices that offerors were supposed to use.
Having determined that Safeguard was required to include the government prices in its proposal, the court then addressed whether the government acted arbitrarily in rejecting the proposal for not including these prices. Safeguard argued that the solicitation only required disqualification of proposals that did not comply with “the line item structure in Section B.” The alleged non-compliance in Safeguard’s proposal related to Schedule B, which listed the CLINs, not Section B, which simply listed the price schedule and period of performance.
But the court found that, reading the solicitation as a whole, Schedule B was included in Section B. The court noted that Section A of the solicitation stated periods of performance “for each CLIN are detailed in Section B” and “exceptions to the line item structure in Section B may result in a bid not being considered for award.” Thus, the solicitation appeared to include the CLINs in Schedule B as part of Section B. Safeguard failed to include line items in Schedule B, so its proposal was properly rejected under Section B.
Safeguard, however, maintained that its omission of the government prices was a trivial error that the government should have waived. The court disagreed, noting that an omission is material when it violates an express provision of the solicitation that serves a material purpose. Here, the omission of the prices violated the terms of the solicitation and had more than a negligible impact on the price evaluation. Without the government’s plug-ins, Safeguard’s price was $6 million less than it should have been. This made it difficult for the government to compare Safeguard’s total price to other offerors’ total prices in accordance with the solicitation’s evaluation scheme.
Nevertheless, Safeguard alleged that the government had breached its duty of good faith and fair dealing by rejecting its proposal. Specifically, Safeguard argued, in response to one of the previous GAO protests, the government had taken corrective action and stated that it would fully evaluate Safeguard’s proposal. Instead, the government changed course and simply rejected Safeguard’s proposal.
The court noted that an agency only breaches its duty of good faith and fair dealing when an award decision is motivated by an irrational, pre-determined outcome without regard to an offeror’s proposal. Here, the agency’ decision to reject Safeguard’s proposal as ineligible was not an about face. In multiple source selection decisions after each corrective action, the agency had noted that Safeguard’s failure to include the government’s plug-ins rendered its proposal non-compliant.
Finally, the court addressed B&O’s motion to dismiss for lack of standing. The contract was a set aside for small businesses. Safeguard was joint venture between a small business and a large business. B&O argued that Safeguard lacked standing because its joint venture agreement did not comply with SBA requirements. The court, however, noted that SBA had apparently approved Safeguard as a small business and there was not sufficient evidence in the administrative record to find that SBA erred.
The court denied Safeguard’s motion for judgment on the administrative record but granted the government’s and B&O’s cross motions. The court further denied B&O’s motion to dismiss for lack of standing.
Safeguard is represented by Alex D. Tomaszczuk, Alexander B. Ginsberg, Aaron S. Ralph, and Kevin R. Massoudi of Pillsbury Winthrop Shaw Pittman, LLC. The government is represented by P. Davis Oliver, Douglas K. Mickle, Robert E. Kirschman, Jr., and Joseph H. Hunt of the U.S. Department of Justice as well as James C. Caine of the Federal Law Enforcement Training Centers. The intervenor, B&O, is represented by Richard W. Arnholt, Todd R. Overman, and Sylvia Yi of Bass, Berry & Sims PLC.
