Bid Protests In Brief Mark D. Colley Arnold & Porter LLP NCMA Boston Chapter November 18, 2015

What are Bid Protests?  Disputes regarding the procurement process –Contractors enlisted to enforce the rules and preserve competition  A means to contest errors, rule violations, and “unreasonable” judgments –NOT a way to resolve policy choices  Great deference to discretionary judgments –Agency “has the right to get it wrong” 2

Protest Types  Pre-Award — Ground rules and competitive range –Example: Challenging a problematic solicitation term that impairs a proposal strategy or favors a competitor.  Post-Award — Contract award flaws –Example: Challenging a failure to follow solicitation terms or applying them unequally. 3

Protest Forums  Government Accountability Office (“GAO”) ̶ Fast, intensive, and (relatively) informal ̶ Branch of Congress--recommends agency action ̶ No appeal rights, but may refile at COFC  Court of Federal Claims (“COFC”) ̶ Traditional court rules, but special expedited protest procedures ̶ Can order agency action ̶ Appeals to the Federal Circuit 4

Protest Forums - Cont’d  Agency protests ̶ Less formal and limited process, so less directly confrontational ̶ Agency self-assessment, but review above the contracting officer. ̶ Typically reserved for preaward protests 5

Protest Timing—GAO Protests Pre-Award: before the deadline for proposal receipt or bid opening. Post-Award: –Default Rule: within 10 calendar days after award or when basis for protest is “known or should have been known.” –Debriefing tolls the default rule: not later than 5 calendar days after a requested and required debriefing in order to secure an automatic stay of contract performance, otherwise, no later than 10 calendar days after the debriefing. Really 4 ½ days 6

Best Practices: Addressing Pre-Award Concerns– Speak Now Or Forever Hold Your Peace  Promptly assess issue. –Ground rules concerns due before proposal submission, time to challenge other issues as short as 10 days. –System favors open competition.  Consider use of bidders’ questions to address structure concerns.  Never delay a pre-award debriefing.  Consider informal channels for disagreement, as appropriate (e.g., agency counsel).  Consider pros and cons of a pre-award protest. 7

Automatic Stay  GAO Protests Only; Not COFC (injunction decision)  Remains in effect while the protest is pending.  Important leverage; protest viability reduced without a stay. 8

Automatic Stay: Agency Override  The head of the procuring agency may authorize the award or performance of a contract upon a written determination and finding that: –“urgent and compelling circumstances that significantly affect interests of the United States” will not permit waiting for a resolution of the protest.  Challenging an override: The Protester may challenge the override by filing an action in the Court of Federal Claims. 9

Post-Award Debriefings  Timely request essential (3 business days) –TAKE THE DATE OFFERED!  Scope/structure varies widely –In person, telephonic, entirely written –Controlled and choreographed  FAR requirements limited -- Not subject to challenge –significant weaknesses or deficiencies; –the overall evaluated cost and technical rating of the awardee and the debriefed offeror; –the overall ranking of all offerors; –a summary of the rationale for the award; –reasonable responses to relevant questions posed by the debriefed offeror as to whether source selection procedures set forth in the solicitation, applicable regulations, and other applicable authorities were followed by the executive agency. 10

Post-Award Debriefings – Cont’d  Best practices –Information gathering vs. debate –Include attendees who know the procurement and proposal in detail Counsel? –Prepare questions in advance (sometimes requested) –Request redacted SSDD, etc. and copies of all debrief materials –Get written confirmation if agency holds debriefing open 11

GAO Protests: Procedure  Agency counsel defends –Agency resources vary widely –Awardees may (and should) intervene to help defend the award decision  Agency responds 30 calendar days after protest filing –Includes Evaluation Record  Comments and Supplemental Protests (if any)10 calendar days after Agency response/record  Supplemental briefing; hearing; ADR – all at GAO’s option.  Decision within 100 calendar days from filing. 12

COFC Protests Are Different  DOJ handles protest defense, not agency counsel.  No fixed filing, procedural or decision deadlines.  Single judge vs. “institutional” review. 13

Forum Choice  Most start at GAO -- Automatic stay; can move to COFC  GAO has exclusive jurisdiction over IDIQ task order protests (over $10M or excess scope)  COFC more burdensome/expensive  Some circumstances and law may favor COFC 14

Common Considerations Before Protesting  Criticality of procurement  Likelihood of protest success  Likelihood of ultimate procurement success  Size of procurement  Customer relations – customer burden  Impact on agency conduct more generally  Investment in procurement  Lack of adequate agency explanation  Availability of CICA stay/injunction  Costs of protest process/possibility of fee award –Costs of affirmative protest unallowable – FAR –Costs of protest defense unallowable absent CO request – FAR –Fee recovery available (typically partial) under CICA/EAJA in limited circumstances 15

Protective Orders Proprietary proposals and source selection evaluations Only attorneys and consultants not involved in “competitive decision-making” A severe handicap on counsel, particularly in highly complex, specialized and technical cases –“Answer the Questions” –A material benefit to have in-house counsel participate 16

Protest Grounds  Fact dependent. Each procurement is different.  No Rule 11 standard –Inference and analysis/“Information and belief” can suffice.  RFP Section M is the key. –Assess the basis for award and what must change to affect the outcome. –Evaluation criteria weights are critical. Were they applied properly?  Where were the mistakes and inequities?  Protester must demonstrate prejudice due to the procurement errors.  Some things are not subject to protest: –Contract administration; –Subcontract awards; –Bias. 17

Top Four Reasons GAO Sustained Protests In FY2014  Failure to follow evaluation criteria  Flawed source selection decision  Unreasonable technical evaluation  Unequal treatment Source: GAO Bid Protest Annual Report to Congress for Fiscal Year 2014, B :-Lack of meaningful Discussions -Cost/price realism evaluations 18

Preparations and Support  Outside counsel – involve early –Selection and conflict resolution –Briefings, background materials  Proposal Team –Manage expectations “Don’t believe everything you may suspect ” –Coach on timing, debriefing planning, protective order limits –Identify experts--even before award –Classified procurements require even more lead time and logistical arrangements 19

Bid Protest Statistics for Fiscal Years FY 2014FY 2013FY 2012FY 2011FY 2010 Cases Filed 2,561 (up 5%) 2,429 (down 2%) 2,475 (up 5%) 2,353 (up 2%) 2,299 (up 16%) Cases Closed 2,4582,5382,4952,2922,226 Merit (Sustain + Deny) Decisions Number of Sustains Sustain Rate13%17%18.6%16%19% Effectiveness Rate43% 42% ADR (cases used) ADR Success Rate83%86%80%82%80% 4.70%3.36%6.17%8%10% Hearings (42 cases)(31cases)(56 cases)(46 cases)(61 cases) Source: GAO Bid Protest Annual Report to Congress for Fiscal Year 2014, B

CRS Analysis – Comparison of Total Contract Obligations To Protests Filed Source: Congressional Research Analysis of GAO Data, available at 21

QUESTIONS? 22

For Additional Information, Please Contact: Mark D. Colley, Partner Arnold & Porter LLP – Washington, DC (202)