B-139622, OCT. 12, 1959

B-139622: Oct 12, 1959

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TO INGERSOLL-RAND COMPANY: REFERENCE IS MADE TO YOUR LETTERS DATED JUNE 5 AND SEPTEMBER 1. WERE TO BE EVALUATED AT 25 PERCENT OF THE END ITEM PRICE. ONE TYPE WAS FOR ENGINEERING DRAWINGS TO BE FURNISHED IN ACCORDANCE WITH AIR FORCE (AMC) DRAWINGS AND DATA LISTS REQUIREMENTS. WHICH WAS ATTACHED TO THE INVITATION. THE SECOND TYPE WAS FOR TECHNICAL DATA TO BE FURNISHED IN ACCORDANCE WITH MCMSP EXHIBIT NO. 1-10. WHICH WAS ALSO ATTACHED TO THE INVITATION. YOUR BID WAS LOW ON EACH INCREMENT OF THE COMPRESSORS. YOUR BID WAS ACCOMPANIED BY A LETTER WHICH CONTAINED THE FOLLOWING ADVICE: "PARAGRAPH 45 (H) OF THE INVITATION STATES THAT PROPRIETARY DATA IS NOT REQUIRED TO BE SUPPLIED UNDER THIS INVITATION.

B-139622, OCT. 12, 1959

TO INGERSOLL-RAND COMPANY:

REFERENCE IS MADE TO YOUR LETTERS DATED JUNE 5 AND SEPTEMBER 1, 1959, PROTESTING AGAINST THE ACTION OF THE DEPARTMENT OF THE AIR FORCE IN REJECTING YOUR LOW BID UNDER IFB 01-601-59-846 AS NONRESPONSIVE TO THE INVITATION, AND IN SUBSEQUENTLY REJECTING ALL BIDS AND READVERTISING.

THE RECORD BEFORE US INDICATES THAT THE INVITATION IN QUESTION REQUESTED BIDS ON FURNISHING TYPE MB-4 COMPRESSORS IN INCREMENTS OF TEN FROM 31 TO 80 UNITS, AND FOR SPARE PARTS WHICH, FOR BID EVALUATION PURPOSES, WERE TO BE EVALUATED AT 25 PERCENT OF THE END ITEM PRICE. THE INVITATION ALSO CALLED FOR SEPARATE BID PRICES ON TWO TYPES OF DATA. ONE TYPE WAS FOR ENGINEERING DRAWINGS TO BE FURNISHED IN ACCORDANCE WITH AIR FORCE (AMC) DRAWINGS AND DATA LISTS REQUIREMENTS, TABLE 250, WHICH WAS ATTACHED TO THE INVITATION. THE SECOND TYPE WAS FOR TECHNICAL DATA TO BE FURNISHED IN ACCORDANCE WITH MCMSP EXHIBIT NO. 1-10, TECHNICAL PUBLICATION REQUIREMENTS FOR SHOP MACHINERY, GROUND SERVICING, AND HANDLING EQUIPMENT, WHICH WAS ALSO ATTACHED TO THE INVITATION. YOUR BID WAS LOW ON EACH INCREMENT OF THE COMPRESSORS, AND REMAINED LOW AFTER CONSIDERATION OF YOUR PRICES OF $3,030.00 FOR TABLE 250 DATA AND $16,300 FOR EXHIBIT NO. 1-10 DATA. HOWEVER, YOUR BID WAS ACCOMPANIED BY A LETTER WHICH CONTAINED THE FOLLOWING ADVICE:

"PARAGRAPH 45 (H) OF THE INVITATION STATES THAT PROPRIETARY DATA IS NOT REQUIRED TO BE SUPPLIED UNDER THIS INVITATION. HOWEVER WE APPRECIATE THAT DATA IS NEEDED FOR IDENTIFICATION, PROVISIONING AND OTHER PURPOSES. WILL THEREFORE SUPPLY IDENTIFICATION TYPE DRAWINGS AND ITEM DESCRIPTION IN ACCORDANCE WITH FEDERAL STANDARD 5. THE DRAWINGS WE SUPPLY WILL NOT BE MANUFACTURING SHOP DETAIL DRAWINGS SINCE THEY CONTAIN CERTAIN PROPRIETARY DATA.'

PARAGRAPH (H) OF CLAUSE 45 ENTITLED "DATA" PROVIDED AS FOLLOWS:

"/H) NOTWITHSTANDING ANY TABLES OR SPECIFICATIONS INCLUDED OR INCORPORATED IN THE CONTRACT BY REFERENCE,"PROPRIETARY DATA" NEED NOT BE FURNISHED UNLESS SUITABLY IDENTIFIED IN THE SCHEDULE OF THE CONTRACT AS BEING REQUIRED. FOR THE PURPOSE OF THIS CLAUSE, "PROPRIETARY DATA" MEANS DATA PROVIDING INFORMATION CONCERNING THE DETAILS OF A CONTRACTOR'S SECRETS OF MANUFACTURE, SUCH AS MAY BE CONTAINED IN BUT NOT LIMITED TO ITS MANUFACTURING METHODS OR PROCESSES, TREATMENT AND CHEMICAL COMPOSITION OF MATERIALS, PLANT LAYOUT AND TOOLING, TO THE EXTENT THAT SUCH INFORMATION IS NOT DISCLOSED BY INSPECTION OR ANALYSIS OF THE PRODUCT ITSELF AND TO THE EXTENT THAT THE CONTRACTOR HAS PROTECTED SUCH INFORMATION FROM UNRESTRICTED USE BY OTHERS.'

BOTH THE CONTRACTING OFFICER AND THE MOAMA STAFF JUDGE ADVOCATE WERE OF THE OPINION THAT THE ABOVE-QUOTED PORTION OF YOUR LETTER OFFERED TO SUPPLY LESS DATA THAN WOULD BE REQUIRED UNDER TABLE 250 AND THAT YOUR BID THEREFORE WAS NOT RESPONSIVE TO THE REQUIREMENTS OF THE INVITATION. APPARENTLY AS A RESULT OF THE INQUIRY INTO THIS ASPECT OF YOUR BID, AN INQUIRY INTO THE ACTUAL NEED OF THE AIR FORCE FOR THE DATA REQUIRED BY TABLE 250 WAS ALSO INSTITUTED, AND IT WAS CONCLUDED THAT THE COMPRESSORS COVERED BY THE INVITATION WERE A STANDARD COMMERCIAL ITEM FOR WHICH ENGINEERING DRAWINGS WERE NOT REQUIRED. ON MAY 13, 1959, YOU WERE THEREFORE INFORMED IN PART AS FOLLOWS:

"2. THE MOAMA STAFF JUDGE ADVOCATE HAS FOUND YOUR BID NONRESPONSIVE WITH RESPECT TO FURNISHING TABLE 250 DATA SINCE YOUR OFFER TO SUPPLY DATA IN ACCORDANCE WITH FEDERAL STANDARD 5 IS A DEVIATION GOING TO THE SUBSTANCE OF THE BID AFFECTING PRICE OR QUALITY, AND THEREFORE ACCEPTANCE WOULD BE PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS.

"3. IT HAS NOW BEEN DETERMINED THAT THE MINIMUM NEED OF THE AIR FORCE IS NOT FOR TABLE 250 DATA IN ACCORDANCE WITH SPECIFICATION MIL-D 5028 (ASG). THEREFORE, IFB 01-601-59-846 IS BEING CANCELLED AND THE TYPE MB-4 COMPRESSORS WILL BE READVERTISED WITHOUT TABLE 250 REQUIREMENT.'

IT IS YOUR CONTENTION THAT THE LETTER ACCOMPANYING YOUR BID MADE NO REFERENCE TO TABLE 250 ATA; THAT IT WAS INTENDED TO BE EXPLANATORY ONLY AND WAS NOT INTENDED TO OFFER LESS THAN WAS REQUIRED BY TABLE 250; AND THAT THE CONTRACTING OFFICER WAS THEREFORE IN ERROR IN DECLARING YOUR BID NONRESPONSIVE.

WITH REFERENCE TO THE NOTICE OF REJECTION DATED MAY 13, AS SET OUT ABOVE, YOUR LETTER OF JUNE 5 ACKNOWLEDGES THE RIGHT OF A CONTRACTING OFFICER TO CANCEL AN INVITATION BEFORE RECEIVING A DECISION FROM THE STAFF JUDGE ADVOCATE THAT THE LOW BID IS NONRESPONSIVE. HOWEVER, YOU POINT OUT THAT SUCH LETTER INDICATES CLEARLY THAT THE DECISION OF THE STAFF JUDGE ADVOCATE IN THIS CASE PRECEDED THE DECISION TO CANCEL THE INVITATION. YOU CONTEND THAT THE STAFF OF THE AIR FORCE WAS FULLY AWARE OF THE CONTENTS AND APPLICABILITY OF TABLE 250 BEFORE DECIDING YOUR BID WAS NONRESPONSIVE AND THAT THE DECISION TO CANCEL THE INVITATION SHOULD THEREFORE HAVE BEEN MADE BEFORE YOUR BID WAS DECLARED NONRESPONSIVE. THIS CONTENTION IS APPARENTLY BASED UPON YOUR BELIEF THAT A LOW BIDDER IN ALL CASES IS ENTITLED TO A FINAL RULING BY THIS OFFICE ON WHETHER HIS BID IS RESPONSIVE, AND THE RESULT OF THE PROCEDURE FOLLOWED IN THIS CASE THEREFORE IS TO DEPRIVE YOU OF A DECISION BY THIS OFFICE TO WHICH YOU ARE LEGITIMATELY ENTITLED.

THE RIGHT OF A LOW BIDDER TO PROTEST TO THIS OFFICE AGAINST REJECTION OF HIS BID IS BASED SOLELY UPON OUR JURISDICTION TO PASS UPON THE LEGALITY OF THE EXPENDITURE OF APPROPRIATED FUNDS UNDER A CONTRACT AWARDED TO A HIGHER BIDDER UNDER THE SAME INVITATION FOR BIDS. HOWEVER, THE QUESTION OF WHETHER AN AWARD IS TO BE MADE UNDER SUCH INVITATION, OR WHETHER ALL BIDS ARE TO BE REJECTED AND THE PROCUREMENT READVERTISED, IS PRIMARILY WITHIN THE JURISDICTION OF THE PROCURING AGENCY. CONSEQUENTLY, THE DECISIONS OF THIS OFFICE ON MATTERS INVOLVING THE REJECTION OF LOW BIDS OPERATE ONLY TO PRECLUDE OR AUTHORIZE AN AWARD TO A HIGHER BIDDER UNDER THE SAME INVITATION, AND SUCH DECISIONS HAVE NO EFFECT UPON THE JURISDICTION OF A PROCURING AGENCY, EITHER BEFORE OR AFTER RECEIPT OF OUR DECISION, TO DECIDE THAT AN AWARD WHICH IS NOT INCONSISTENT WITH OUR DECISION SHOULD BE MADE UNDER THE INVITATION IN QUESTION, OR WHETHER ALL BIDS SHOULD BE REJECTED AND THE PROCUREMENT READVERTISED. IN VIEW THEREOF, IT NECESSARILY FOLLOWS THAT A DETERMINATION WITHIN THE PROCURING AGENCY THAT A LOW BID IS NONRESPONSIVE WOULD NOT PRECLUDE A SUBSEQUENT DETERMINATION BY THE AGENCY THAT IT WOULD BE IN THE BEST INTEREST OF THE GOVERNMENT TO REJECT ALL BIDS AND READVERTISE.

THE RULE IS EQUALLY WELL ESTABLISHED THAT AN INVITATION FOR BIDS MUST REFLECT THE ACTUAL NEEDS OF THE GOVERNMENT, AND OUR DECISIONS HAVE CONSISTENTLY HELD THAT AN INVITATION IS INVALID IF BASED UPON SPECIFICATIONS REQUIRING BIDDERS TO FURNISH MORE THAN IS NECESSARY TO MEET SUCH ACTUAL NEEDS.

THE RECORD BEFORE US INDICATES A DETERMINATION BY THE DEPARTMENT OF THE AIR FORCE THAT THE TABLE 250 DATA REQUIRED UNDER IFB 01-601-59-846 WAS NOT NECESSARY TO MEET THE NEEDS OF THE AGENCY, AND IFB 01-601-59 1445, UNDER WHICH THE READVERTISEMENT FOR BIDS WAS EFFECTED, DOES NOT REQUIRE BIDDERS TO QUOTE PRICES UPON OR FURNISH SUCH DATA. THE FACT THAT VARIOUS BIDS UNDER THE ORIGINAL INVITATION STATED SEPARATE PRICES FOR FURNISHING THIS DATA WOULD APPEAR TO BE SUFFICIENT EVIDENCE THAT THE INCLUSION OF A REQUIREMENT TO FURNISH SUCH DATA WOULD RESULT IN THE EXPENDITURE OF FEDERAL FUNDS FOR USELESS MATERIAL IN THE EVENT OF A CONTRACT AWARD UNDER THE ORIGINAL INVITATION WHICH INCLUDED THE PURCHASE OF TABLE 250 DATA. VIEW THEREOF, IT IS OUR OPINION THAT THE INVITATION WAS DEFECTIVE.

CONCERNING THE POSSIBILITY OF AWARDING A CONTRACT UNDER THE ORIGINAL INVITATION WHICH DID NOT INCLUDE THE FURNISHING OF TABLE 250 DATA, THIS OFFICE HAS CONSISTENTLY HELD THAT THE CONTRACT AWARDED TO A LOW BIDDER MUST BE THE SAME CONTRACT OFFERED TO ALL BIDDERS, AND THAT ALL BIDS MUST BE EVALUATED ON THE SAME BASIS. WE UNDERSTAND THAT TWO OF THE REMAINING BID PRICES FOR TABLE 250 DATA WERE IN AMOUNTS OF $1,200 AND $4,000, WHILE ONE BID INDICATED "NO CHARGE" AND ANOTHER SUBMITTED NO SEPARATE BID PRICE FOR FURNISHING SUCH DATA. UNDER THE "DATA PRICING" TERMS OF THE INVITATION IT WAS PROVIDED WITH RESPECT TO FAILURE OF THE LATTER TWO BIDS TO INCLUDE SEPARATE PRICES, THAT THE GOVERNMENT WOULD CONSIDER THE DATA PRICE TO BE INCLUDED IN THE COST OF THE APPROPRIATE END ITEM. UNDER THE CIRCUMSTANCES, IT WOULD NOT BE PROPER, WITHOUT DEFINITE INFORMATION CONCERNING THE AMOUNT WHICH THESE TWO BIDDERS HAVE INCLUDED IN THEIR END ITEM PRICES TO COVER THE COST OF FURNISHING TABLE 250 DATA, TO MAKE AN AWARD TO ANY OTHER BIDDER WHICH DID NOT INCLUDE FURNISHING SUCH DATA. IS THEREFORE OUR OPINION THAT THE AIR FORCE WAS WITHOUT AUTHORITY TO AWARD A CONTRACT UNDER IFB 01-601-59-846, AND REJECTION OF ALL BIDS AND READVERTISEMENT WAS PROPER.

IN VIEW OF OUR OPINION ON THIS ASPECT OF THE MATTER, AND SINCE TABLE 250 DATA IS NOT BEING REQUESTED UNDER IFB 01-601-59-1445, THE QUESTION OF WHETHER YOUR BID, AS QUALIFIED BY YOUR LETTER OF APRIL 8, WAS RESPONSIVE TO THE TABLE 250 DATA REQUIREMENTS OF THE INVITATION, BECOMES ACADEMIC, AND WE DECLINE TO STATE AN OPINION THEREON.