[Protest of Navy Contract Award for Warehouse System]

A firm protested a Navy contract award for a warehouse system to another firm, contending that the award was improper because the Navy materially altered the ground rules of competition for the awardee without notifying the other offerers. The Navy stated that the protest was untimely because the protester failed to diligently pursue information forming the basis for its protest. GAO held that, due to the serious nature of the allegations, the doubtful timeliness of the protest should not preclude its consideration. GAO found that: (1) the Navy failed to respond to the protester's initial freedom of information request; (2) the Navy accepted an offer which contained payment and delivery terms contrary to those contained in the solicitation without amending the solicitation; and (3) since the Navy unreasonably excluded the protester's proposal from competition, the protester was entitled to recovery of the costs of proposal preparation and filing and pursuing its protest. Accordingly, the protest was sustained.