Protest challenging the agency’s evaluation is dismissed, where the agency reasonably concluded that the protester’s submission of a private audit of its cost accounting system did not meet the requirement for an audit conducted by a government agency, and where the agency had no obligation to clarify or waive the protester’s omission of the required certification documents.
Criterion Systems Inc. protested multiple IDIQ contracts awarded by the General Services Administration to eighty-one firms for information technology services. In its action at the Court of Federal Claims, the protester argued that the agency did not take remedial steps to address its failure to provide the required documentation for an acceptable cost accounting system and that the agency abused its discretion by neither seeking clarification nor waiving the error as an informality and minor irregularity.
GSA required each offeror to demonstrate that it had an acceptable CAS based on a federal agency’s audit and adequacy determination. Offerors were directed to claim points for meeting this requirement and others in a scoring worksheet. GSA found that Criterion claims the points for having an approved CAS but did not submit adequate supporting documents. Criterion complained that GSA should have sought clarification.
In response, GSA argued that Criterion improperly conflated the steps that the agency was required to perform in reviewing each proposal. GSA explained it was only required to seek clarification regarding discrepancies at the initial screening stage, which was step two of the five-step process. Because Criterion submitted documents that appeared to substantiate its points for CAS certification, there was no discrepancy that it needed to clarify. The court agreed.
Next, Criterion argued that GSA abused its discretion by not seeking clarification regarding the incorrect materials from a private audit. According to the protester, the missing government audit could have been redressed through a clarification. Criterion further argued that the CO was obligated to seek clarification because the discrepancy between the claimed points in the scoring sheet and the supporting materials was apparent.
In response, GSA maintained that Criterion’s failure to provide the supporting materials for an acceptable CAS was not subject to clarification because the error was not apparent. The court agreed and further noted that the protester failed to show GSA had reason to suspect its private audit submission was an error rather than a deliberate choice. The court further concluded that the submission of the private audit instead of the government audit strongly suggested an intentional decision rather than a mistake.
Finally, Criterion argued that GSA should have waived its failure to submit the proper documentation as an informality. Criterion claimed that a waiver was appropriate because the missing government audit did not affect the substance of its accurate representation in the scoring worksheet that it had a DCAA audit. In response, GSA argued that the government audit was a material component of the solicitation that could not be waived.
The court determined that Criterion failed to demonstrate that the CO abused his discretion by not waiving the requirement. The court also reasoned that even if the protester’s submission of the private audit was a minor irregularity, the agency would have undermined its own interest in ensuring that offerors submitted compliant offers.
Moreover, the court found no indication the agency had to means to assess whether Criterion’s private audit was the functional equivalent to the required government audit. To the extent Criterion argued that GSA’s decision to not accept private audits was unreasonable, the court found that challenge to solicitation’s requirements was untimely.
Criterion Systems Inc. is represented by David T. Hickey. The government is represented by Jimmy S. McBirney, United States Department of Justice.
