Alert
Alert
04.22.22
On February 4, 2022, the Court of Federal Claims (COFC) issued its decision in Golden IT, LLC v. United States, as previously discussed here, which broke with Government Accountability Office (GAO) precedent regarding whether offerors must notify the awarding agency when key personnel become unavailable after proposal submission. This month’s COFC decision in IAP Worldwide Services Inc. v. United States again rejects long-standing GAO precedent. This time the divergence relates to GAO’s interpretation of DFARS 215.306, which states that “contracting officers should conduct discussions” for DoD acquisitions valuated at over $100 million.
GAO has interpreted FAR 215.306 to require that discussions be the “default procedure” for DoD procurements valued at over $100 million. Nevertheless, GAO regularly finds that where an agency has a documented basis for forgoing discussions, the “default procedure” can be overcome. In doing so, GAO has long employed a three-part test, commonly known as the “SAIC test,” to determine whether discussions are required by FAR 215.306. This test considers whether (1) there were deficiencies in the protester’s proposal, (2) the awardee’s proposal was evaluated as being technically superior to the other proposals, and (3) the awardee’s price was reasonable.
In IAP Worldwide Services Inc. v. United States, the Court explicitly rejects the GAO’s three-part test, finding it is based on case law that predated FAR 215.306 and that the application of the test inappropriately changes the meaning of word “should” in DFARS 215.306 to “may.” The Court reasoned that the usage of the word “should” is equivalent of the phrase, “expected course of action or policy that is to be followed unless inappropriate for a particular circumstance.” Thus, the Court found that DFARS 215.306 creates a strong presumption, not easily overcome, that discussions are required in DoD procurements valued at over $100 million, which the government did not meet in this case.
The COFC decisions in IAP Worldwide Services and Golden IT highlight a growing divergence in case law at the two federal procurement bid protest fora. This divergence will inevitably lead contractors to perceive that one forum is more favorable than another, depending upon the facts of the particular acquisition, when deciding where to file a protest.