Protest challenging the terms of a solicitation is sustained. The protester asserted that the solicitation contemplated a brand-name only procurement, but the agency had not published a justification and approval for a brand-name solicitation required by the FAR. The agency argued that the solicitation actually sought brand-name or equal products, so a justification and approval was unnecessary. GAO found that the solicitation allowed offerors to submit alternative products in addition to, no in lieu of brand-name products. Thus, the solicitation set forth a “brand-name-and-equal” procurement, not “brand-name-or-equal.” GAO also sustained the protest because the solicitation required offerors to provide the agency with an online marketplace that was inimical the requirements of fair and open competition.
The Library of Congress issued a solicitation seeking cloud computing services. The solicitation contemplated award of a single IDIQ contract. The solicitation identified name-brand products of the three cloud services providers, Amazon, Google, and Microsoft, and required offerors to provide pricing for products or services form those three companies. The solicitation also provided that bidders could offer the services of other unidentified companies that offered cloud services.
Two prospective bidders, Mythics, Inc. and Oracle America, Inc. filed protests challenging the terms of the solicitation. The protesters alleged that the solicitation, in various ways, unduly restricted competition.
Before addressing the merits of the protesters’ arguments, GAO noted that the Library had requested dismissal, contending that it planned to take corrective action. But GAO denied the request because the Library did not advise which of three possible courses of corrective action the agency intended to take. Vague or ambiguous statements of by an agency to take corrective action some indefinite point in the future—which may not even render the protest academic—do not provide a basis for dismissal of a protest. The Library had failed to provide sufficient detail about what it planned to do as part of the corrective action.
As to substance of the of the protest, Mythics and Oracle contended that the Library improperly required offerors to provide brand-name products from Amazon, Google, and Microsoft without executing the required justification and approval required for a brand-name-only solicitation. The FAR requires that when agencies restrict competition to a particular brand, they must prepare a justification and approval setting forth why only the brand name product will suffice.
The Library acknowledged that it failed to publish a justification and approval, but it claimed that that failure was now moot. The Library reasoned that the FAR allows agencies to use brand-name-or-equal solicitations that mention a brand name product but also set forth the characteristics of the brand-name product that an “equal” product must meet to be acceptable for award. The Library contended that amendments to the solicitation allowing services from companies other than Amazon, Google, and Microsoft had converted the solicitation into a brand-name-or-equal solicitation that did not require a justification and approval.
But GAO found that the addition of an “other products” category to the solicitation did not convert the solicitation from a “brand-name only” into one seeking “brand-name” or “other” products. A brand-name-or equal solicitation permits offerors to propose a brand-name or an alternative equivalent to the brand name. In this case, however, the amended solicitation continued to require offerors to propose brand-name products while also permitting them to propose “other” products in addition to, but not in lieu of, brand-name products. GAO reasoned that this was not a “brand-name or equal” solicitation but instead a “brand-name and equal.”
Moreover, GAO continued, although the amendments allowed for other products, they failed to provide information about what characteristics those other products needed to meet in order to be equal to the brand-name products. The Library’s solicitation included a list of requirements that cloud service products had to meet, but that list made no reference to the particular brand-name products being solicited or the characteristics particular to the brand-name products that an alternative product would have to meet to be acceptable.
The Library argued that it intended to modify the solicitation to remove all references to brand name products. But GAO found that this intended modification would still not cut it. Even with the modification, the Library still planned to solicit some of its requirements on a brand-name basis from Microsoft.
In addition to the brand-name issue, GAO also found that the solicitation impermissibly required offerors to provide an online marketplace for third party software. The solicitation indicated that the awardee would make Amazon’s, Google’s and Microsoft’s online platform available to the agency, which would allow it easily buy and deploy software. Citing Court of Federal Claims caselaw, GAO found that providing the agency with an online marketplace was inimical to open and fair competition. Online marketplaces are populated with software chosen by the cloud service providers. The selection process for these products is unknown, and they are not subject to rules governing federal agencies. There is no way for an agency to know whether the third-party products are the best solution to the agency’s technical requirements, whether they are being sold at fair and reasonable prices, or whether the vendors are responsible.
Finally, the protesters argued that the solicitation improperly sought award of a single IDIQ contract. Under the FAR, multiple IDIQ contracts are preferred. If an agency plans to award single IDIQ contract worth more than $150 million, the head of the contracting agency must execute a determination explaining why a single award is appropriate. GAO found that the Library had not provided the required determination from the head of the contracting agency.
The Library argued that the solicitation allowed for the possibility of a multiple award contract. GAO, however, noted that the solicitation expressly stated that the agency intended to make a single award. The Library also claimed that it intended to lower the value of the contract under $150 million so that the determination form the head of the contracting agency was unnecessary. GAO dismissed this argument, noting that the Library had not yet amended the solicitation to reduce the contract value.
Mythics is represented by David S. Black, Gregory R. Hallmark, and Amy Fuentes of Holland & Knight LLP. Oracle is represented by Craig A. Holman and Nathanial E. Castellano of Arnold & Porter Kaye Scholer, LLP. The agency is represented by Emily Vartanian of the Library of Congress. GAO attorneys Scott H. Riback and Tania Calhoun participated in the preparation of the decision.
