Waivers Of Minor Informalities, Meaningful Discussions, And A "Dreary Wreck" Of A Procurement (August 2021 Bid Protest Roundup)

• Published date: 10 September 2021
• Subject Matter: Government, Public Sector, Government Contracts, Procurement & PPP
• Law Firm: Morrison & Foerster LLP
• Author: Mr James Tucker

In this month's Law360 Bid Protest Roundup, we consider three decisions released in August 2021. In the first case, the Government Accountability Office (GAO) considered and rejected a protester's argument that an agency was required to waive or allow the offeror to correct a minor informality that the agency determined made its proposal ineligible for award. In the second case, the GAO addressed an agency's duty to reopen discussions with an offeror when a post-discussion re-evaluation resulted in an offeror receiving a significant weakness for an aspect of its proposal that the evaluators previously determined had no weaknesses. The Court of Federal Claims provides our final decision of the month. In that case, the Court enjoined the Government from transferring billions of dollars' worth of one agency's requirements to existing contracts of another agency, without competition and without a documented rationale that could survive judicial scrutiny.

Waiver of Minor Informalities

In Continuity Global Solutions-Secure Me WLL Security, JV, B-419875, Aug. 12, 2021, the GAO considered the extent to which a procuring agency must waive or allow offerors to correct minor informalities in a proposal. For negotiated procurements under Federal Acquisition Regulation (FAR) Part 15, the answer is that procuring agencies ordinarily have no such duties.

Background

The Department of State issued a solicitation under FAR Part 15, seeking security guard services. Unsurprisingly, the solicitation contained the FAR 52.204-7, which requires offerors to register in the System for Award Management (SAM) as a condition of award. Somewhat surprisingly, though, the solicitation incorporated by reference the October 2013 version of the provision and incorporated by full text the October 2016 version of the same clause. Both versions of the provision require offerors to be registered in SAM by the date of contract award. Neither of these provisions, however, was the correct one; the agency should have incorporated the October 2018 version of FAR 52.204-7, which was in effect as of the date the solicitation was issued, and requires SAM registration by the date of proposal submission.

The lowest-priced offeror had not registered in SAM as of the date of its proposal submission. The agency subsequently requested that the offeror verify that it would be registered in SAM prior to award. The offeror responded that it had initiated the registration process and anticipated the registration would be active within two weeks. Six weeks later, the contracting officer checked SAM and found the offeror still was not registered. The agency therefore rejected the proposal and made award to the next-in-line offeror instead. The protest followed.

Analysis

The protester conceded it was not registered in SAM as of the date of contract award. It argued, however, that this was a "minor informality," and under FAR 14.405, the Government was required to "give the bidder an opportunity to cure any deficiency resulting from a minor informality or irregularity in a bid or waive the deficiency, whichever is to the advantage of the Government." The protester also cited GAO case law in which the GAO held that agencies were required to allow otherwise successful bidders the opportunity to cure the defect of failing to be registered in SAM.

The GAO rejected the protester's argument.

First, the GAO observed that this competition was a negotiated acquisition subject to the procedures of FAR Part 15. Thus, the protester's reliance on FAR 14.405 (which governs FAR Part 14 sealed-bid procurements) was misplaced. FAR Part 15 lacks any analogous requirement for agencies to waive or allow offerors to correct minor informalities in their proposals.

Second, the GAO noted the decisions upon which the protester relied were themselves FAR Part 14 acquisitions. And even there, the GAO sustained the protests because, under FAR Part 14, a bidder should have the opportunity to cure...