March 19, 2018 - Protests & Litigation

The Silent No: Initial Adverse Agency Action Can Simply Be No Action at All

Protests and LitigationComing on the heels of a decision presenting two timeliness reminders, which we addressed in “GAO Presents a Study in Timeliness Traps,” the GAO once again issued a decision last week presenting a third timeliness trap of which protesters must be wary.  In MLS-Multinational Logistics Services, Ltd., B-415782; B-415708.2, March 7, 2018, ___ CPD ¶ ___, the GAO dismissed a protester’s challenge to the terms of two solicitations where the protester did not file a protest at the GAO within 10 days of initial adverse agency action on an agency-level protest.  The “trap” came down when the initial adverse agency action came not with a direct response to the agency-level protest but with mere silence.

In these cases, the protester had filed agency-level protests with the Navy challenging the terms of the solicitations.  In each case, the protester’s initial protest to the agency was timely, as each was filed before the closing date for receipt of proposals.  However, both agency-level protests were filed very shortly before the closing date – for one solicitation, just one day before proposals were due, and for the other, just four days beforehand.  For each agency-level protest, the Navy eventually provided a decision denying the protest, but these decisions both came after the agency had continued with the procurement by accepting proposals as planned on the solicitation’s closing date.

This latter point turned out to be the key factor.  As the GAO explained, to be considered timely, a protest following an agency-level protest must be filed within 10 calendar days of “actual or constructive knowledge of initial adverse agency action.”  4 C.F.R. § 21.2(a)(3).  Initial agency action does not simply mean a decision, or even an email from the agency saying it is going to decide a certain way.  Rather, this phrase can also mean inaction so long as that inaction is prejudicial to the position taken in a protest filed with the agency.  By definition in the GAO rules, this can include “the opening of bids or receipt of proposals.”  4 C.F.R. §21.0(e).  The GAO further explained that a request to have the protest decided at a level above the Contracting Officer did not extend the deadline for filing at the GAO or create a new triggering event as a result of the decision being issued.  As a result, the GAO dismissed the protester’s arguments, which were filed only after the formal denial of the agency-level protests.

This decision leads to a few important takeaways:

  1. It is important to recognize that adverse agency action will not always be issued in blaring bold letters. Sometimes adverse agency action can simply be inaction.  Or it may be a statement made by phone or email.  Once adverse agency action occurs, however, a protester will only have 10 days to seek redress at the GAO.
  2. As offerors get closer to the closing date for proposals, consider whether an agency-level protest will provide any benefit. If a protest is filed just before proposals are due, the agency may not have time to give the protest proper consideration before the closing date, which would then trigger the 10-day deadline for the GAO protest.
  3. In all cases, a strong line of communication between an offeror’s proposal and contracts team and its legal team is important to recognize these issues and avoid the pitfalls that the GAO’s rules can sometimes provide.