Low Price Alone Not Dispositive of Awardee’s Intent to Violate Berry Amendment; GAO B-413798, Inspire International

Protest that an awardee’s price is so low that it evidences an intent to violate the Berry Amendment is denied where the awardee’s quotation included the required certification of compliance; the agency received additional information confirming the awardee’s intent; and nothing in the awardee’s quotation called into question the protester’s ability or willingness to comply.

Inspire International LLC protested the Army’s award of a contract for embroidered baseball caps to Lag Sports and Leather Wear LLC, arguing that the awardee’s low price indicates it will not comply with the Berry Amendment.

Inspire argued the awardee’s contract price was so low, it could only be based on an intent to furnish non-domestic products, in violation of the Berry Amendment, which generally restricts the Department of Defense’s expenditures for certain items, including articles of clothing, to domestically-produced products. In support of this allegation, the protester asserted that the Marner Group, named in the RFQ as a brand name manufacturer of the style of cap sought, agreed that the required quantity of that company’s products could not be manufactured and resold for the price of the awarded contract.

GAO disagreed, finding that the agency reasonably relied on the awardee’s representation that it would comply with the Berry Amendment, and that the agency also sought additional reassurances regarding the domestic manufacture of the caps.  Lag Sports’s quotation provided the representations and certifications required by the request for quotations with regard to its intent to comply with the domestic production requirements of the Berry Amendment and Buy America Act.

The protester, insisted that the low price offered by Lag Sports’s quotation was sufficient to alert the agency that the awardee did not intend to comply with the Berry Amendment, and to require additional scrutiny. GAO disagreed that the awardee’s price alone, by itself or in comparison to an incumbent’s price, indicates the vendor’s intent. For example, a firm properly may decide to submit a price that is extremely low, or even below the cost of performance. Moreover, notwithstanding the awardee’s self-certification, the Army sought additional information from Lag Sports and received assurances regarding the awardee’s intent to comply with the requirements of the Berry Amendment.  In its response, Lag Sports identified the domestic mills that would be supplying the fabric it would use to make the caps, and confirmed that Lag Sports itself would be manufacturing the caps in the United States.

Because Inspire did not show the Army failed to follow the required procedures for ascertaining the awardee’s intent with regard to the Berry Amendment, any reasonable basis to conclude that the awardee will furnish noncompliant products, GAO denied the protest.

Inspire International is represented by Kristin Rae Nowers. The government is represented by Capt. Jessica E. Hom, Department of the Army. GAO attorneys Gabriel D. Soll, and Christina Sklarew participated in the preparation of the decision.