This month’s bid protest round up focuses on three recent decisions from the U.S. Court of Federal Claims and the Government Accountability Office (GAO). These decisions involve (1) standing at the Court where protest allegations are speculative; (2) the rules related to delivery orders issued under Federal Supply Schedule (FSS) contracts; and (3) conflicts of interest.
This decision involves the factual elements required to establish standing in a bid protest before the U.S. Court of Federal Claims. In dismissing the protest for lack of standing, the Court of Federal Claims found that the protester, ZeroAvia, Inc. (ZeroAvia), failed to allege sufficient facts for its broad assertions of errors in the procurement.
The solicitation informed offerors that the National Aeronautics and Space Agency (NASA) would conduct a best value trade-off after the agency utilized a competitive range to winnow the pool of competitors based on the most highly rated proposals. After receiving and evaluating proposals, NASA notified ZeroAvia that it was not selected for the competitive range.
ZeroAvia protested its exclusion from the competitive range at the U.S. Court of Federal Claims, alleging unequal treatment, failure to engage in clarifications, and failure to conduct meaningful discussions. At the initial status conference, the government proposed filing its motion to dismiss prior to submitting the administrative record because ZeroAvia allegedly lacked standing to pursue to its protest. ZeroAvia objected, arguing that it required the record to respond “intelligently” to the government’s motion to dismiss. The Court agreed with ZeroAvia and ordered the government to file the administrative record prior to filing its motion to dismiss.
After the government filed the record, the parties fully briefed the government’s motion to dismiss and the response thereto. After holding an oral argument, the Court concluded that ZeroAvia had failed to carry its burden to establish its standing to pursue its bid protest. The Court found that each of ZeroAvia’s challenges was based upon conjecture and insufficient to show that ZeroAvia “had a substantial chance of winning the award.”
In particular, the Court noted that, although ZeroAvia challenged its assessed weaknesses and deficiencies, it did not “identify any particular weakness or deficiency that was assessed as a result of an alleged procurement error despite having access to such information as a result of the debriefing.” Moreover, ZeroAvia did not reference the solicitation or its proposal to show that it provided the required information underlying the weaknesses or deficiencies assessed, or that NASA employed unstated criteria in evaluating its proposal. Making matters worse, despite claiming that it needed the administrative record to respond “intelligently” to the government’s motion to dismiss, ZeroAvia did not cite to the administrative record a single time in its response.
Faced with ZeroAvia’s failure to plead its allegations with sufficient particularly, the Court held dismissal for lack of standing was the “inevitable outcome.”
ZeroAvia is a cautionary tale for disappointed offerors hoping to raise speculative allegations to obtain access to the administrative record underlying a procurement. Because standing is determined as of the commencement of a suit, a protester cannot raise completely unsupported allegations with hope of unearthing better protest allegations based on the administrative record. Instead, standing must be established in the Complaint itself.
Nevertheless, ZeroAvia is an outlier. Although it is no doubt true that protesters must plead their allegations with some grounding in fact, that generally is a low bar to clear, particularly at the Court. Given this reality, it is notable that, even after it received the administrative record, ZeroAvia could not use such information to demonstrate that its complaint was factually sufficient.
Chicago American Manufacturing, LLC
Chicago American Manufacturing, LLC concerns a Department of the Army (Army) Request for Quotations (RFQ) issued under FSS procedures to holders of General Services Administration (GSA) Schedule 71 contracts. The Army awarded the deliver order to Inovo, Inc. (Inovo), and Chicago American Manufacturing, LLC (CAM) protested the award, alleging, among other things, that Inovo’s quotation was not technically acceptable because Inovo quoted a product that was not on its GSA Schedule contract.
The Army’s solicitation stated the Army would issue a delivery order to the offeror who quoted the lowest price and a technically acceptable offering. The solicitation provided that quotations would be technically acceptable if they satisfied the specifications in the Furniture Item Description (FID) and if the contractor could complete the work by the specified installation dates. The FID stated “all required items and features submitted shall be on current GSA schedule contract.”
The Army received quotations from three offerors and, after multiple rounds of technical review, the Army evaluated all three quotations as technically acceptable. After receiving best and final offers, the Army awarded the delivery order to Inovo. Following the award, CAM protested, alleging Inovo’s Schedule Contract included a bed with dimensions of 78 inches by 38 inches, whereas the solicitation required a bed with dimensions of 80 inches by 38 inches. Although Inovo’s quotation identified a bed with the correct dimensions, CAM argued that where there is a discrepancy between a vendor’s FSS Schedule Contract and its quote, the terms of the Schedule Contract is binding.
The GAO agreed with CAM. The GAO noted that “[t]echnical specifications for products available under a firm’s FSS contract are fixed, discrete, specific, contractually binding, and not subject to alteration,” and that the only relevant inquiry was whether the Army had properly assessed whether Inovo quoted items from its Schedule Contract. Because the GAO concluded Inovo quoted products not on its Schedule Contract, it held the Army could not properly issue a delivery order to Inovo.
Government contracts is a game of inches, and Inovo lost that game here because its Schedule Contract included a product that did not match exactly the specifications in the Army’s solicitation. Vendors must remember that FSS orders are tied to the underlying Schedule Contract and not whatever product is identified in a vendor’s quotation. Vendors should be careful to compete for only those products that are actually on their Schedule, and ensure that their quotations ultimately match those products exactly.
KOAM Engineering Systems, Inc.
This decision concerns an alleged personal conflict of interest based on the marriage between an agency contracting official and an individual proposed as key personnel for the awardee of a Department of Navy (Navy) contract.
The Navy issued a solicitation for engineering support services. After receipt and evaluation of proposals, the Navy selected McKean Defense Group (McKean) for award. KOAM Engineering Systems, Inc. (KES) protested, alleging the Navy misevaluated proposals and failed to consider a personal conflict of interest (or the appearance of such) that tainted the award decision. In response to the protest, the Navy took corrective action to reevaluate proposals and investigate the potential conflict. After completing its reevaluation and concluding no conflict existed, the Navy again awarded the contract to McKean, prompting KES to again allege, among other things, that the award was tainted by a personal conflict of interest.
KES’s conflict of interest protest ground alleged that an employee of McKean’s who helped prepared the firm’s proposal for the procurement was married to a Navy Contracting Officer’s Representative (COR) who worked on the incumbent contract held by KES and had access to KES’s cost information. KES contended that – given the individuals’ marriage, close proximity at home, and common financial interest – there was a presumption of impropriety that tainted the procurement and award decision.
Based on the information developed through the Contracting Officer’s conflict of interest investigation, the GAO concluded there was no conflict and that, in any event, any conflict could not have materially prejudiced KES. The GAO noted that KES did not dispute the Contracting Officer’s finding that the COR was not involved in the instant procurement or otherwise have access to associated procurement materials. Moreover, despite KES’s suggestion that the GAO should assume the COR disclosed competitively sensitive information to her spouse at McKean, the GAO refused, noting that the Contracting Officer had collected signed and sworn declarations attesting to the contrary. Finally, the GAO noted that even if the COR had disclosed the KES cost information to which she had access, the Contracting Officer reasonably concluded such information was unlikely to result in competitive harm because of the structure of the solicitation. Thus, the GAO denied KES’s conflict of interest allegation.
KOAM Engineering Systems is another example of the significant deference contracting officers receive from the GAO with respect to conflict of interest investigations and the overall difficulty in alleging successful conflict of interest protest grounds. As long as the contracting officer has meaningfully considered a potential conflict and made a reasonable determination regarding whether a significant conflict exists, or has been adequately avoided, neutralized, or mitigated (or waived in accordance with regulations), the GAO will not second-guess the agency. This includes agency determinations that were made even during the pendency of a protest.
 ZeroAvia, Inc. v. United States, No. 21-1991, 2022 WL 2661792 (Fed. Cl. June 7, 2022) (reissued for publication July 11, 2022).
 Chicago Am. Mfg. LLC, B-420533 et al., May 23, 2022, 2022 CPD ¶ ___ (publicly released July 5, 2022).
 KOAM Eng’g Sys., Inc., B-420157.2, July 6, 2022, 2022 CPD ¶ ___.