B-156779, JUL. 19, 1965

B-156779: Jul 19, 1965

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BENDIX CINCINNATI DIVISION: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER DATED MAY 13 AND MAY 19. THREE BIDS WERE RECEIVED AND OPENED AS SCHEDULED ON MARCH 31. THE LOWEST BID WAS SUBMITTED BY YOUR COMPANY AND THE SECOND LOWEST BID WAS SUBMITTED BY THE LANDSVERK ELECTROMETER COMPANY. YOUR BID WAS $15. AWARDS WILL BE MADE ONLY FOR SUCH PRODUCTS THAT HAVE. WHETHER OR NOT SUCH PRODUCTS HAVE ACTUALLY BEEN INCLUDED IN THE LIST BY THAT DATE. SUPPLIERS ARE URGED TO COMMUNICATE WITH THE OFFICE DESIGNATED BELOW AND ARRANGE TO HAVE THE PRODUCTS THAT THEY PROPOSE TO OFFER TESTED FOR QUALIFICATION. SUPPLIERS HAVING PRODUCTS WHICH HAVE BEEN TESTED AND QUALIFIED BUT NOT YET LISTED ARE REQUESTED TO SUBMIT EVIDENCE OF SUCH QUALIFICATION WITH THEIR BIDS/PROPOSALS.

B-156779, JUL. 19, 1965

TO THE BENDIX CORPORATION, BENDIX CINCINNATI DIVISION:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM AND LETTER DATED MAY 13 AND MAY 19, 1965, RESPECTIVELY, PROTESTING THE AWARD OF A CONTRACT TO OTHER THAN YOUR COMPANY UNDER INVITATION FOR BIDS NO. 600-697-65, ISSUED ON FEBRUARY 26, 1965, BY THE NAVY PURCHASING OFFICE, WASHINGTON, D.C., IN CONNECTION WITH A PROPOSED PROCUREMENT OF A MINIMUM OF 9,733 AND A MAXIMUM OF 13,733 "IM-9 ( ( (PD RADIACMETERS, WITH TWO (2) INSTRUCTION SHEETS PER EQUIPMENT.'

THREE BIDS WERE RECEIVED AND OPENED AS SCHEDULED ON MARCH 31, 1965. THE LOWEST BID WAS SUBMITTED BY YOUR COMPANY AND THE SECOND LOWEST BID WAS SUBMITTED BY THE LANDSVERK ELECTROMETER COMPANY, GLENDALE, CALIFORNIA. BASED UPON THE QUANTITY SELECTED FOR AWARD (9,848 UNITS), YOUR BID WAS $15,756.80 LOWER THAN THAT OF THE LANDSVERK ELECTROMETER COMPANY. HOWEVER, THE NAVY PURCHASING OFFICE PROPOSED TO REJECT YOUR BID ON THE BASIS OF THE "QUALIFIED PRODUCTS" CLAUSE OF THE INVITATION WHICH READS, IN PART, AS FOLLOWS:

"WITH RESPECT TO PRODUCTS REQUIRING QUALIFICATION, AWARDS WILL BE MADE ONLY FOR SUCH PRODUCTS THAT HAVE, PRIOR TO TIME SET FOR OPENING OF BIDS/PROPOSALS, BEEN TESTED AND QUALIFY FOR INCLUSION IN THE QUALIFIED PRODUCTS LIST IDENTIFIED BELOW, WHETHER OR NOT SUCH PRODUCTS HAVE ACTUALLY BEEN INCLUDED IN THE LIST BY THAT DATE. SUPPLIERS ARE URGED TO COMMUNICATE WITH THE OFFICE DESIGNATED BELOW AND ARRANGE TO HAVE THE PRODUCTS THAT THEY PROPOSE TO OFFER TESTED FOR QUALIFICATION. SUPPLIERS HAVING PRODUCTS WHICH HAVE BEEN TESTED AND QUALIFIED BUT NOT YET LISTED ARE REQUESTED TO SUBMIT EVIDENCE OF SUCH QUALIFICATION WITH THEIR BIDS/PROPOSALS, SO THAT THEY MAY BE GIVEN CONSIDERATION.

"RADIACMETERS - QUARTZ FIBER SELF-INDICATING GENERAL SPECIFICATION-- (QPL -24037-1 DATED 8 JULY 1964 (TITLE OF QUALIFIED PRODUCTS LIST)

"BUREAU OF SHIPS, DEPARTMENT OF THE NAVY

WASHINGTON, D.C.

(NAME AND ADDRESS OF OFFICE WITH WHICH MANUFACTURERS SHOULD

COMMUNICATE)"

IT IS STATED IN THE LETTER OF MAY 19, 1965, THAT THE CINCINNATI DIVISION OF YOUR COMPANY IS ONE OF THE LEADING MANUFACTURERS OF RADIACMETERS AND HAS BEEN CLOSELY RELATED TO THE SPECIFIC RADIACMETER IN QUESTION, THE IM- 9. YOU REFER TO NAVY CONTRACT NO. NOBAR-72754 AS ONE UNDER WHICH YOU DESIGNED THE IM-9 TO ITS ORIGINAL SPECIFICATION, MIL-R-19894, CONFIGURATION; AND TO NAVY CONTRACT NO. NOBAR-91153, UNDER WHICH YOU ARE ENGAGED IN THE PRODUCTION OF RADIACMETERS IN ACCORDANCE WITH MILITARY SPECIFICATION, MIL-R-24037, AND SUPPLEMENT NO. 1 THERETO. IT IS ALLEGED THAT CONTRACT NO. NOBSR-91153 ORIGINALLY CALLED FOR IM-9 RADIACMETERS MEETING SPECIFICATION, MIL-R-19894, BUT THAT THE CONTRACT WAS AMENDED ON FEBRUARY 5, 1965, TO REQUIRE PRODUCTION IN ACCORDANCE WITH SPECIFICATION, MIL-24037-1, AS THE RESULT OF A "DIRECT CHANGE.' IT IS ALLEGED THAT THERE WAS A DECREASE IN THE CONTRACT PRICE AND YOU SUGGEST THAT THIS REFLECTED A RELAXATION IN CONTRACT REQUIREMENTS.

IT IS CONTENDED THAT THE FOREGOING FEW SALIENT FACTS SHOULD AMPLY DEMONSTRATE THAT YOUR COMPANY IS THOROUGHLY FAMILIAR WITH THE MANUFACTURE OF RADIACMETERS IN GENERAL AND WITH THE IM-9 IN PARTICULAR; AND THAT THERE WERE SEVERAL CIRCUMSTANCES WHICH LED BENDIX TO BELIEVE THAT ITS IM-9 PRODUCT WAS INCLUDED ON THE APPLICABLE QUALIFIED PRODUCTS LIST. YOU REFER TO A COMMUNICATION DATED MAY 6, 1964, FROM THE BUREAU OF SHIPS, ADVISING YOU THAT THE BUREAU WAS IN THE PROCESS OF ESTABLISHING A QUALIFIED PRODUCTS LIST FOR RADIACMETERS AND PROVIDING FOR THE SUBMISSION OF CERTAIN INFORMATION REGARDING MANUFACTURERS' DESIGNATIONS OF MODEL NUMBERS AS COMPARED WITH THE SPECIFIED GOVERNMENT MODELS NOS. IM-19, IM-107, IM-135 AND IM-143. YOU ALSO REFER TO YOUR REPLY OF JUNE 10, 1964, WHEREIN YOU DESIGNATED FOUR MODEL NUMBERS OF YOUR PRODUCTION, INCLUDING A COMPARABLE MODEL NUMBER FOR THE IM-9, BUT OMITTING ANY COMPARABLE MODEL FOR THE GOVERNMENT-DESIGNATED MODEL NO. IM-19 BECAUSE A SIMILAR MODEL WAS "NOT PRODUCED BY BENDIX.' YOU FURTHER REFER TO THE FACT THAT YOU SUBMITTED PREPRODUCTION MODELS OF IM-9 RADIACMETERS UNDER CONTRACT NO. NOBSR 91153 ON JANUARY 29, 1965, AND THAT THOSE MODELS WERE CONDITIONALLY APPROVED BY THE BUREAU OF SHIPS ON RADIACMETERS UNDER CONTRACT NO. NOBSR-91153 ON JANUARY 29, 1965, AND THAT THOSE MODELS WERE CONDITIONALLY APPROVED BY THE BUREAU OF SHIPS ON OR ABOUT MAY 7, 1965.

IT IS ALLEGED THAT YOUR FIRM DID NOT RECEIVE THE LETTER DATED JULY 7, 1964, FROM THE BUREAU OF SHIPS, STATING THAT ON THE BASIS OF CERTAIN TEST REPORTS BENDIX'S PRODUCTS WOULD APPEAR ON QPL-24037 FOR THE IM-19, IM-107, IM-135 AND IM-143 RADIACMETERS. THE ACTUAL LIST FOR QPL-24037-1 WAS ISSUED ON JULY 8, 1964, AND SHOWS THAT IN ADDITION TO YOUR FOUR MODELS, LANDSVERK ELECTROMETER COMPANY WAS APPROVED FOR SIX MODELS, INCLUDING THE IM-9; AND THE VICTOREEN INSTRUMENT COMPANY WAS APPROVED FOR ONLY THE IM-9 RADIACMETER. YOU INDICATED THAT THE CONTENTS OF THE LETTER OF JULY 7 HAD BEEN DICTATED TO YOU OVER THE TELEPHONE AFTER OPENING OF THE BIDS RECEIVED IN RESPONSE TO INVITATION NO. 600-697-65, BUT QUESTIONED THE ACTUAL ISSUANCE OF ANY SUCH LETTER TO BENDIX BECAUSE YOU WERE SUBSEQUENTLY INFORMED THAT A COPY OF THE LETTER COULD NOT BE LOCATED IN THE FILES OF THE CINCINNATTI DIVISION OF THE INSPECTOR OF NAVAL MATERIAL. IT HAS NEVERTHELESS BEEN REPORTED BY THE NAVY THAT A COPY OF THE LETTER TO BENDIX IS IN THE QUALIFIED PRODUCTS LIST FILES OF THAT OFFICE AND, THAT THE BUREAU OF SHIPS HAS REPORTED THAT ITS RECORDS INDICATE THAT THE LETTER WAS ACTUALLY MAILED TO YOUR FIRM.

IN ADDITION TO CONTENDING THAT YOU MISTAKENLY BELIEVED THAT YOUR IM 9 WAS INCLUDED ON THE QUALIFIED PRODUCTS LIST, IT IS CONTENDED THAT THE NAVY APPARENTLY FAILED TO FOLLOW THE APPLICABLE PROVISIONS OF THE ARMED SERVICES PROCUREMENT REGULATION OR TO RECOGNIZE A DECISION OF OUR OFFICE, B-143792, DECEMBER 9, 1960, 40 COMP. GEN. 348, CONCERNING "OPPORTUNITY FOR QUALIFICATION," ASPR 1-1105, AND "INADEQUATE COMPETITION," ASPR 1-1109.

IN 40 COMP. GEM. 348, IT WAS HELD THAT A LOW BIDDER WHO WAS THEN A GOVERNMENT CONTRACTOR WAS ENTITLED TO THE RECEIPT OF NOTIFICATION THAT QUALIFICATION OF ITS PRODUCT UNDER THE NEW PROCUREMENT WOULD BE REQUIRED. ASPR 1-1105 PROVIDES THAT, UPON DETERMINATION THAT A PRODUCT IS TO BE COVERED BY A QUALIFIED PRODUCTS LIST, MANUFACTURERS SHALL BE URGED TO SUBMIT THEIR PRODUCTS FOR QUALIFICATION AND WHERE POSSIBLE SHALL BE GIVEN SUFFICIENT TIME TO ARRANGE FOR QUALIFICATION TESTING PRIOR TO THE ISSUANCE OF THE INITIAL INVITATION FOR BIDS OR PROPOSALS FOR THE ITEM AS A QUALIFIED PRODUCT. ASPR 1-1109 (A) CALLS FOR REVIEW OF THE APPLICABLE QUALIFIED PRODUCTS LIST PRIOR TO SOLICITATION TO ASCERTAIN THAT THE NUMBER OF SUPPLIERS IS ADEQUATE FOR COMPETITION; AND ASPR 1-1109 (B) PROVIDES THAT THE CONTRACTING OFFICER SHALL ADVISE THE SPECIFICATION PREPARING ACTIVITY OF THE NAME AND ADDRESS OF ANY CONCERN WHICH REQUESTED COPIES OF THE SOLICITATION BUT WAS NOT INCLUDED ON THE QUALIFIED PRODUCTS LIST. ASPR 1-1109 (B) ALSO STATES THAT "THE SPECIFICATION PREPARING ACTIVITY MAY THEN ATTEMPT TO INTEREST SUCH CONCERNS IN BECOMING QUALIFIED.'

IN REGARD TO THE FACT THAT YOUR FIRM WAS LISTED AS QUALIFIED FOR PRODUCTION OF THE IM-19 RADIACMETER, IT HAS BEEN EXPLAINED BY THE DEPARTMENT OF THE NAVY THAT THIS ACTION WAS TAKEN IN ACCORDANCE WITH THE QUALIFIED PRODUCTS LIST PROCEDURES WHICH PERMIT THE QUALIFICATION OF ONE PRODUCT TO BE EXTENDED TO ANOTHER PRODUCT OF THE SAME MANUFACTURER WHERE THE DIFFERENCES IN THE PRODUCTS ARE COMPARATIVELY SMALL, PARTICULARLY WITH RESPECT TO THE CRITICAL AREAS WITH WHICH QUALIFICATION IS PRIMARILY CONCERNED. IN THE CASE OF RADIACMETERS, THE APPROVAL OF ONE PRODUCT IN ONE RANGE MAY BE EXTENDED TO ANOTHER IN THE SAME RANGE AND THE APPROVAL OF A LOW-RANGE PRODUCT MAY BE EXTENDED TO ONE IN THE HIGH RANGE BUT NOT VICE VERSA.

IT IS THE POSITION OF THE DEPARTMENT OF THE NAVY THAT YOU HAD A FULL OPPORTUNITY TO QUALIFY YOUR IM-9 RADIACMETER IN CONFORMITY WITH ASPR 1- 1105 AND THAT, EVEN IF YOU DID NOT RECEIVE THE LETTER OF JULY 7, 1964, IT IS INCREDIBLE THAT RESPONSIBLE OFFICIALS OF YOUR COMPANY COULD HAVE BELIEVED THAT BENDIX'S IM-9 WAS INCLUDED ON THE LIST. AS STATED BY THE DEPARTMENT, INCLUSION OF A PRODUCT ON A QUALIFIED PRODUCTS LIST IS NOT AN AUTOMATIC PROCESS BUT COMES ONLY AFTER OFFICIAL NOTIFICATION TO THE MANUFACTURER THAT HIS PRODUCT HAS BEEN APPROVED FOR SUCH INCLUSION. ALSO, IT IS POINTED OUT IN THE DEPARTMENTAL REPORT THAT THE BASIC SPECIFICATION, MIL-R-24037, SPELLS OUT THE FIRST QUALIFICATION OF A LOW RANGE RADIACMETER AND REQUIRES IT TO BE SUBMITTED FOR, AND PASS, THE SPECIFIED TESTS. VIEW THEREOF, THE DEPARTMENT FINDS IT DIFFICULT TO UNDERSTAND HOW YOUR COMPANY COULD HAVE BEEN LED TO BELIEVE THAT ITS IM-9 RADIACMETER WAS QUALIFIED UNDER QPL 24037.

APPARENTLY YOUR COMPANY HAD NOT, AS OF JUNE 10, 1964, PRODUCED IM-9 RADIACMETERS WHICH HAD PASSED THE TESTS FOR QUALIFICATION UNDER EITHER SPECIFICATION MIL-4-19894 OR MIL-R-24037, AND IT DELAYED ANY ATTEMPTS TO QUALIFY PENDING THE RESULTS OF THE WORK BEING PERFORMED UNDER NAVY CONTRACT NO. NOBSR-91153, WHICH WAS AWARDED BEFORE THE QUALIFIED PRODUCTS LIST WAS ESTABLISHED. THE DEPARTMENT OF THE NAVY HAS REPORTED THAT YOUR STATEMENT REGARDING PRODUCTION UNDER CONTRACT NO. NOBSR-72754 (NOBSR 72524) IS MISLEADING SINCE THE MOST IMPORTANT PART OF THAT CONTRACT WAS THE SUBMISSION OF TECHNICAL REPORTS, AND THE LABORATORY MODELS WHICH YOU FURNISHED "WERE NOT IM-9'S TO MIL-R-19894 CONFIGURATION NOR WERE THESE LABORATORY MODELS FULLY TESTED AGAINST THE REQUIREMENTS OF THAT SPECIFICATION.' THIS IS SUPPORTED BY THE FACT THAT A LATER FORMALLY ADVERTISED PROCUREMENT, WHICH LED TO CONTRACT NOBSR 91153 WITH BENDIX FOR IM-9'S IN ACCORDANCE WITH MIL-R 19894, CONTAINED PREPRODUCTION MODEL AND TESTING REQUIREMENTS BUT PROVIDED THESE REQUIREMENTS WOULD BE DELETED FOR ANY SUPPLIER WHO HAD PREVIOUSLY FURNISHED APPROVED IM-9 PREPRODUCTION EQUIPMENT OR ACCEPTED IM-9 PRODUCTION EQUIPMENT. THIS SOLICITATION REQUESTED BIDDERS WHO HAD DONE SO TO IDENTIFY THE CONTRACT OR CONTRACTS UNDER WHICH SUCH EQUIPMENT WAS MANUFACTURED AND DELIVERED. BENDIX DID NOT CLAIM IN ITS BID UNDER THIS SOLICITATION THAT IT HAD MANUFACTURED AND DELIVERED SUCH EQUIPMENT UNDER CONTRACT NOBSR 72524 OR ANY OTHER CONTRACT. HAD BENDIX, IN FACT, PREVIOUSLY FURNISHED APPROVED OR ACCEPTED IM-9 PRE PRODUCTION OR PRODUCTION EQUIPMENT, THE SUBSEQUENT CONTRACT (NOBSR 91153) WOULD NOT HAVE CONTAINED PREPRODUCTION REQUIREMENTS, WHICH IT DOES, AND THE BENDIX IM-9, IN ALL PROBABILITY, WOULD HAVE BEEN PLACED ON THE QPL WITHOUT FURTHER TESTING.

IN CONNECTION WITH BENDIX'S EXPERIENCE AND PRODUCTION OF RADIACMETERS THE NAVY REPORTS:

"8. BENDIX'S PERFORMANCE UNDER TWO CURRENT CONTRACTS WITH THE BUREAU OF SHIPS IS FAR FROM SATISFACTORY. CONTRACT NOBSR 81164 ISSUED IN JANUARY 1960 CALLED FOR 4,368 IM-143 (HIGH RANGE) RADIACMETERS TO BE DELIVERED AUGUST THROUGH NOVEMBER 1960. WHILE BENDIX DELIVERED THESE UNITS SUBSTANTIALLY ON TIME, IT WAS LATER DISCOVERED THROUGH FURTHER SAMPLE TESTING THAT THESE RADIACMETERS WERE DEFECTIVE, AND APPROXIMATELY 3,650 OF THEM WERE RETURNED FOR CORRECTION OR REPLACEMENT UNDER THE GUARANTY CLAUSE OF THE CONTRACT. BY THE END OF JANUARY 1964, THERE WERE STILL 2,698 UNITS TO BE REDELIVERED TO THE GOVERNMENT AND BY MODIFICATION NO. 3 OF 29 JANUARY 1964, BENDIX AGREED TO DELIVER THESE UNITS BY 29 MARCH 1964. FAILED TO DO SO AND BY DECEMBER 1964 ABOUT 1,740 UNITS WERE STILL TO BE DELIVERED. A "TEN DAY CURE" LETTER WAS ISSUED AS THE FIRST STEP IN A POSSIBLE DEFAULT TERMINATION AND AS A RESULT ON 29 MARCH 1965 BENDIX AGREED TO DELIVER THESE UNITS BY 15 JUNE 1965 AND THE BUREAU TO ACCEPT SUCH DELIVERIES.

"9. THE OTHER CONTRACT ON WHICH BENDIX'S PERFORMANCE HAS BEEN INEXCUSABLY DELAYED IN NOBSR 91153, REFERRED TO ABOVE, DATED 24 MARCH 1964, WHICH, AS AMENDED, CALLS FOR PRODUCTION QUANTITY OF 14,918 IM-9 ( ( (PD RADIACMETERS (LOW RANGE) WITH PREPRODUCTION TEST REQUIREMENTS, AND WHICH IS REFERRED TO ABOVE AND IN THE BENDIX LETTER OF PROTEST. IT WILL BE NOTED THAT THIS CONTRACT WAS ISSUED WELL BEFORE THE QPL FOR RADIACMETERS WAS ESTABLISHED. THIS CONTRACT ORIGINALLY CALLED FOR DELIVERY OF THE TWENTY PREPRODUCTION UNITS TO BE DELIVERED 6 MONTHS AFTER DATE OF CONTRACT OR ABOUT 24 SEPTEMBER 1964, PROVIDED 90 DAYS FOR PREPRODUCTION TESTING AND APPROVAL BY THE GOVERNMENT, AND REQUIRED PRODUCTION DELIVERIES TO BEGIN 14 MONTHS AFTER DATE OF CONTRACT OR IN JUNE 1965. AGAIN, IN DECEMBER 1964 WHEN THE PREPRODUCTION UNITS WERE SOME MONTHS OVERDUE, ANOTHER "TEN-DAY CURE" LETTER HAD TO BE WRITTEN. AS A RESULT OF THIS LETTER AND SUBSEQUENT CORRESPONDENCE, MODIFICATION NO. 4 DATED 5 FEBRUARY 1965 WAS ENTERED INTO WHICH EXTENDED THE TIME FOR DELIVERY OF THE PREPRODUCTION UNITS TO 5 FEBRUARY 1965 AND THE START OF PRODUCTION DELIVERIES TO 31 AUGUST 1965. THESE EXTENSIONS WERE AGREED TO BY THE GOVERNMENT AS THE BEST THAT COULD BE OBTAINED AND BETTER THAN WOULD LIKELY BE OBTAINED BY A TERMINATION FOR DEFAULT AND REPROCUREMENT. BENDIX IS CORRECT IN STATING (PAGE 3, PARAGRAPH 2, OF ITS PROTEST LETTER)THAT CONTRACT NOBSR 91153 ORIGINALLY INCORPORATED SPECIFICATION MIL-R-19894 AND WAS CHANGED BY THIS SAME MODIFICATION NO. 4 TO INCORPORATE CORRECT IN STATING (PAGE 3, PARAGRAPH 2, OF ITS PROTEST LETTER) THAT CONTRACT NOBSR 91153 ORIGINALLY INCORPORATED SPECIFICATION MIL-R-19894 AND WAS CHANGED BY THIS SAME MODIFICATION NO. 4 TO INCORPORATE MIL-R-24037, THE CURRENT QPL SPECIFICATION WHICH GOVERNS THE PRESENT PROCUREMENT UNDER IFB 600-697-65. HOWEVER, BENDIX IS INCORRECT IN STATING (PAGE 4, PARAGRAPH 2) THAT THIS WAS A DIRECTED CHANGE. RATHER, IT WAS SPECIFICALLY REQUESTED BY BENDIX BY LETTER OF 9 OCTOBER 1964. WITH RESPECT TO THE IM-9'S THE PRESENT SPECIFICATION, MIL-R-24037, IS IN SOME AREAS LESS STRINGENT AND OTHERS MORE STRINGENT THAN THE PREDECESSOR SPECIFICATION MIL-R-19894. MODIFICATION NO. 4 DID REDUCE THE CONTRACT UNIT PRICE BY FIFTY CENTS.

"10. BENDIX'S PREPRODUCTION MODELS UNDER CONTRACT NOBSR 91153 WERE SHIPPED ON 29 JANUARY 1965 AS BENDIX STATES (PAGE 4, PARAGRAPH 3 OF ITS PROTEST LETTER) ARRIVING AT U.S. NAVY RADIOLOGICAL DEFENSE LABORATORY, SAN FRANCISCO, CALIFORNIA, A FEW DAYS LATER. BENDIX IS ALSO CORRECT IN STATING THAT CONDITIONAL APPROVAL WAS GIVEN BY BUREAU OF SHIPS LETTER, SER 682B-621 OF 4 MAY 1965. THE PREPRODUCTION MODELS DID NOT PASS ALL OF THE TESTS BUT THE DEFICIENCIES WERE OF A NATURE WHICH COULD BE CORRECTED FAIRLY READILY FOR PRODUCTION UNITS AND THE CORRECTIONS WOULD HAVE NO SIGNIFICANT EFFECT ON OTHER ELEMENTS OF THE EQUIPMENT, SO THERE IS NO NEED FOR FURTHER PREPRODUCTION TESTING OF THE CORRECTIONS AND THEIR IMPACT ON THE EQUIPMENT. PREPRODUCTION APPROVAL DOES NOT AUTOMATICALLY RESULT IN PLACEMENT ON A QPL. BENDIX RECOGNIZED THIS BY LETTER OF 21 MAY 1965 REQUESTING THAT THE IM-9 TO BE FURNISHED UNDER CONTRACT NOBSR 91153 BE PLACED ON QPL 24037 ON THE BASIS OF THE U.S. NAVY RADIOLOGICAL DEFENSE LABORATORY TEST AND REPORT. THE BUREAU OF SHIPS HAS THIS REQUEST UNDER ADVISEMENT OWING TO THE CONDITIONAL APPROVAL OF THE PREPRODUCTION MODELS. THIS CONDITIONAL APPROVAL COUPLED WITH PAST POOR PERFORMANCE IS SUFFICIENT CAUSE TO WITHHOLD ACTION UNTIL THE DEFICIENCIES HAVE BEEN CORRECTED. FURTHER PROCUREMENTS OF IM-9'S ARE ANTICIPATED DURING THE NEXT YEAR SO THERE SHOULD BE AMPLE TIME FOR BENDIX TO FULLY QUALIFY FOR THE NEXT PROCUREMENT.'

FROM THE FOREGOING IT APPEARS THAT BENDIX'S FAILURE TO QUALIFY ITS IM-9 WAS DUE PRIMARILY TO ITS OWN FAILURE TO TIMELY FURNISH THE REQUIRED PREPRODUCTION MODELS UNDER CONTRACT NOBSR 91153. SINCE BENDIX WAS CONTRACTUALLY BOUND TO DELIVER PREPRODUCTION MODELS OF THE IM-9 IN SEPTEMBER 1964 FOR TESTS AND APPROVAL AND SINCE ITS IM-9 WOULD HAVE BEEN PLACED ON THE QPL HAD IT PASSED SUCH TESTS, IT IS NOT SEEN HOW BENDIX REASONABLY CAN CLAIM THAT IT WAS NOT GIVEN AMPLE OPPORTUNITY TO QUALIFY ITS IM-9 PRIOR TO THE OPENING OF THE BIDS UNDER INVITATION NO. 600-697-65, MARCH 31, 1965.

ACCORDINGLY, SINCE BENDIX'S IM-9 HAD NOT BEEN TESTED AND QUALIFIED FOR INCLUSION ON THE QUALIFIED PRODUCTS LIST PRIOR TO DATE OF THE OPENING OF THE BIDS, AS SPECIFICALLY REQUIRED BY THE INVITATION, WE FIND NO BASIS TO QUESTION THE PROPOSED REJECTION OF THE BENDIX BID AS NOT BEING RESPONSIVE. NEITHER DO WE FIND SUFFICIENT BASIS TO SUGGEST TO THE NAVY THAT THE INVITATION SHOULD BE CANCELLED AND THE PROCUREMENT READVERTISED IN ORDER TO GIVE BENDIX AN OPPORTUNITY TO QUALIFY. THEREFORE, YOUR PROTEST MUST BE DENIED.