B-149115, SEP. 5, 1962

B-149115: Sep 5, 1962

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INC.: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF JUNE 7. 536.53 WAS APPROXIMATELY $159. AWARD WAS MADE TO THAT FIRM ON JUNE 8. IS BASED PRIMARILY ON THE ALLEGATIONS THAT. BID IS NOT COMPETITIVE IN GOOD FAITH BUT FALLS WITHIN A PATTERN. BID IS NOT RESPONSIVE TO THE IFB AND AIR FORCE PROCUREMENT REQUIREMENTS.'. IN SUPPORT OF YOUR CONTENTION THAT BELL AND HOWELL HAS ENGAGED IN UNFAIR COMPETITIVE PRACTICES WHICH HAVE RESTRICTED COMPETITION. IS APPROXIMATELY 15 PERCENT LESS THAN THE AMOUNT IT QUOTED ON A PRIOR INVITATION. ON WHICH YOU WERE THE SUCCESSFUL BIDDER. COVERING THE SUIT OF FEDERAL MANUFACTURING AND ENGINEERING CORPORATION FOR DAMAGES ALLEGED TO HAVE BEEN SUSTAINED BY REASON OF BELL AND HOWELL'S VIOLATION OF THE ANTITRUST LAWS.

B-149115, SEP. 5, 1962

TO LUMEN, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER OF JUNE 7, 1962, WITH ENCLOSURE, AND SUBSEQUENT CORRESPONDENCE, PROTESTING THE AWARD OF A CONTRACT TO BELL AND HOWELL COMPANY UNDER INVITATION FOR BIDS NO. 33-657- 62-300, DATED APRIL 16, 1962, ISSUED BY THE AIR FORCE SYSTEMS COMMAND, AERONAUTICAL SYSTEMS DIVISION, WRIGHT-PATTERSON AIR FORCE BASE, OHIO.

THE CITED INVITATION, AS AMENDED, REQUESTED BIDS FOR THE FURNISHING OF 2,257 16-MILLIMETER MOTION PICTURE SOUND PROJECTORS, INCLUDING DESIGNATED RELATED EQUIPMENT AND DATA, IN ACCORDANCE WITH PRESCRIBED MILITARY SPECIFICATIONS AND DRAWINGS, FOR USE BY THE DEPARTMENT OF THE NAVY, SIGNAL CORPS, AND MARINE CORPS IN THE EXHIBITION OF EDUCATIONAL, TRAINING AND RECREATIONAL FILMS TO MILITARY PERSONNEL. THE RECORD SHOWS THAT, OF THE TWO BIDS RECEIVED IN RESPONSE TO THE INVITATION, THE BID OF BELL AND HOWELL IN THE TOTAL AMOUNT OF $1,467,536.53 WAS APPROXIMATELY $159,000 LESS THAN YOUR BID. ACCORDINGLY, AWARD WAS MADE TO THAT FIRM ON JUNE 8, 1962.

YOUR PROTEST TO THE AWARD, AS SET FORTH IN YOUR LETTER OF JUNE 5, 1962, TO THE PROCUREMENT AGENCY, AND AMPLIFIED IN YOUR LETTER OF JUNE 18, 1962, TO THIS OFFICE, IS BASED PRIMARILY ON THE ALLEGATIONS THAT--

"/A) THE BELL AND HOWELL CO. BID IS NOT COMPETITIVE IN GOOD FAITH BUT FALLS WITHIN A PATTERN, WHETHER BY DESIGN OR NOT, WHICH RESULTS IN A RESTRICTION OF THE COMPETITIVE FIELD.

"/B) THE BELL AND HOWELL CO. BID IS NOT RESPONSIVE TO THE IFB AND AIR FORCE PROCUREMENT REQUIREMENTS.'

IN SUPPORT OF YOUR CONTENTION THAT BELL AND HOWELL HAS ENGAGED IN UNFAIR COMPETITIVE PRACTICES WHICH HAVE RESTRICTED COMPETITION, YOU REFER TO THE VARYING AMOUNTS BID BY THAT FIRM IN RESPONSE TO GOVERNMENT INVITATIONS FOR SIMILAR PROJECTORS AND THAT ITS UNIT PRICE BID ON THE CURRENT INVITATION, DESPITE INCREASED REQUIREMENTS, IS APPROXIMATELY 15 PERCENT LESS THAN THE AMOUNT IT QUOTED ON A PRIOR INVITATION, DATED MAY 12, 1959, ON WHICH YOU WERE THE SUCCESSFUL BIDDER. ALSO, IN SUPPORT OF THIS CONTENTION, YOU FORWARDED A COPY OF A CIVIL COMPLAINT FILED APRIL 11, 1958, IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK, COVERING THE SUIT OF FEDERAL MANUFACTURING AND ENGINEERING CORPORATION FOR DAMAGES ALLEGED TO HAVE BEEN SUSTAINED BY REASON OF BELL AND HOWELL'S VIOLATION OF THE ANTITRUST LAWS, TOGETHER WITH A COPY OF THE STIPULATION OF DISCONTINUANCE OF THAT COMPLAINT, DATED DECEMBER 27, 1960.

THE FACTS PRESENTED IN SUPPORT OF THIS CONTENTION OF UNFAIR COMPETITIVE PRACTICES DO NOT AFFORD ANY LEGAL BASIS FOR OUR OFFICE TO QUESTION THE AWARD MADE TO BELL AND HOWELL. YOU DO NOT ALLEGE, NOR DO THE RECORDS OF OUR OFFICE SHOW, THAT BELL AND HOWELL IS A DEBARRED BIDDER OR OTHERWISE INELIGIBLE FOR AWARDS OF GOVERNMENT CONTRACTS. WE FIND NO LEGAL OBJECTION TO THE FACT THAT THE PRICES BID BY BELL AND HOWELL IN RESPONSE TO INVITATIONS HAVE NOT REMAINED CONSTANT. IN FACT, IN THE NORMAL COMPETITION FOR AWARDS UNDER GOVERNMENT INVITATIONS, WE WOULD NOT CONSIDER SUCH BIDDING PRACTICES BY COMPETING FIRMS UNUSUAL. IN ANY EVENT, REGARDLESS OF WHETHER THE PRICE QUOTED BY A BIDDER IN RESPONSE TO A FORMALLY ADVERTISED PROCUREMENT IS MORE OR LESS THAN THAT QUOTED ON A PRIOR INVITATION, UNDER PRESCRIBED STATUTORY PROCEDURES AWARD IS REQUIRED TO BE MADE TO THAT RESPONSIBLE BIDDER WHOSE BID CONFORMS TO THE INVITATION AND WILL BE MOST ADVANTAGEOUS TO THE GOVERNMENT. SEPARATE AND APART, HOWEVER, FROM THE AUTHORITY VESTED IN OUR OFFICE, YOU ARE ADVISED THAT ALLEGATIONS INVOLVING ALLEGED VIOLATIONS OF THE ANTITRUST LAWS RELATING TO CONSPIRACIES, MONOPOLIES AND MONOPOLISTIC PRACTICES MAY PROPERLY BE BROUGHT TO THE ATTENTION OF THE FEDERAL TRADE COMMISSION AND/OR THE DEPARTMENT OF JUSTICE, THE LAW-ENFORCING AGENCIES OF THE GOVERNMENT CHARGED WITH THE ADMINISTRATION OF THOSE LAWS.

YOUR ALLEGATION THAT THE BID OF BELL AND HOWELL IS NOT RESPONSIVE TO THE INVITATION AND TO THE REQUIREMENTS OF THE PROCUREMENT AGENCY IS BASED, IN SUBSTANCE, ON THE CONTENTION THAT THE DRAWINGS PRESCRIBED BY THE INVITATION, FURNISHED BY BELL AND HOWELL UNDER AN EARLIER CONTRACT, WERE NOT SUITABLE FOR THE PURPOSE OF MANUFACTURING THE PROJECTORS IN ACCORDANCE WITH GOVERNMENT REQUIREMENTS; AND, THAT THE INVITATION SHOULD HAVE PRESCRIBED, AS MANUFACTURING CRITERIA, THE DRAWINGS FURNISHED TO THE GOVERNMENT UNDER YOUR CONTRACT NO. AF 33/600/-39874, DATED JUNE 26, 1959, WHICH REFLECT LATER CHANGES IN MILITARY SPECIFICATIONS AND WHICH WERE APPROVED BY THE DEPARTMENT OF THE NAVY AND BY THE DEPARTMENT OF THE AIR FORCE.

CONCERNING YOUR ALLEGATION AS TO THE UNSUITABILITY OF THE DRAWINGS PRESCRIBED BY THE INVITATION, WE UNDERSTAND IT IS YOUR POSITION THAT YOUR BID PRICE WAS BASED, NOT ON THE PRESCRIBED DRAWINGS, BUT ON DRAWINGS FURNISHED UNDER YOUR 1959 CONTRACT AND THAT BELL AND HOWELL'S BID WAS NOT RESPONSIVE IN THAT IT WAS BASED, TO YOUR DETRIMENT, ON THE IMPROPERLY DESIGNATED DRAWINGS. YOU THEREFORE CONTEND THAT THE AWARD TO BELL AND HOWELL SHOULD BE CANCELLED AND THE CONTRACT AWARDED TO YOUR FIRM AS THE LOW RESPONSIVE BIDDER.

SO FAR AS CONCERNS THE DRAWINGS PRESCRIBED BY THE INVITATION, AS AMENDED, AND THE ADEQUACY OF SUCH DRAWINGS TO PRODUCE AN ACCEPTABLE PRODUCT, THE ADMINISTRATIVE REPORT TO THIS OFFICE STATES THAT THE DRAWINGS ARE SIGNAL CORPS DRAWINGS WHICH, WHILE BASED ON EARLIER BELL AND HOWELL DRAWINGS, WERE REDRAWN TO UPDATE AND TO PROVIDE NECESSARY CHANGES, AND WHICH WERE CHOSEN BY THE USING AGENCIES, SIGNAL CORPS AND NAVY, AS PRODUCTION CRITERIA ON THE BASIS OF THEIR DETERMINATION THAT, CONSIDERING ALL FACTORS, INCLUDING EXISTING PARTS INVENTORIES, THESE DRAWINGS WERE "THE MOST COMPLETE, UP-TO-DATE, AND SUITABLE FOR THE PURPOSE INTENDED.' IT IS ALSO NOTED THAT THESE DRAWINGS WERE SPECIFICALLY MADE CONTROLLING IN THE PROCUREMENT BY AN AMENDMENT TO THE INVITATION ISSUED AS A RESULT OF YOUR COMPLAINT THAT THE ORIGINAL INVITATION WAS UNCLEAR ON THIS POINT. WE HAVE CONSISTENTLY HELD THAT THE DRAFTING OF SPECIFICATIONS TO REFLECT THE NEEDS OF THE GOVERNMENT, AS WELL AS THE DETERMINATION WHETHER THE BIDS RECEIVED OFFER A PRODUCT MEETING SPECIFICATION REQUIREMENTS, IS PRIMARILY THE FUNCTION AND RESPONSIBILITY OF THE PROCURING AGENCY CONCERNED. 17 COMP. GEN.554; 38 ID. 71; 40 ID. 294. IN CONFORMITY THEREWITH, IN ANY CASE WHERE DIFFERENCES OF OPINION EXIST AS TO WHETHER SPECIFICATIONS ARE ADEQUATE TO PERMIT OR REQUIRE MANUFACTURE OF A PRODUCT WHICH WILL MEET THE NEEDS OF THE USING AGENCY, THIS OFFICE WILL NOT SUBSTITUTE ITS JUDGMENT FOR THAT OF THE AGENCY UNLESS THERE IS CLEAR AND CONVINCING EVIDENCE, NOT HERE PRESENT, THAT THE AGENCY IS IN ERROR AND THAT A CONTRACT AWARDED ON THE BASIS OF SUCH SPECIFICATIONS, BY UNDULY RESTRICTING COMPETITION OR OTHERWISE, WOULD BE A VIOLATION OF LAW.

THE RECORD SHOWS THAT THE BID OF BELL AND HOWELL CONTAINS NO EXCEPTION TO THE PRESCRIBED TERMS AND CONDITIONS OF THE INVITATION OR ANY INDICATION OF MISUNDERSTANDING OF THE SPECIFICATION REQUIREMENTS. WE THEREFORE PERCEIVE NO BASIS UPON WHICH WE MAY QUESTION THE CONTRACTING OFFICER'S DETERMINATION THAT THE BID WAS RESPONSIVE TO THE INVITATION. IN VIEW THEREOF AND SINCE ITS BID PRICE WAS SUBSTANTIALLY LOWER THAN YOUR OFFER, WE MUST CONCLUDE THAT THE AWARD, AS REQUIRED BY THE STATUTES GOVERNING PUBLIC PROCUREMENT, HAS BEEN MADE TO THE LOW RESPONSIVE BIDDER. ACCORDINGLY, YOUR PROTEST TO THE AWARD MUST BE AND IS DENIED.