B-160110, DEC. 1, 1966

B-160110: Dec 1, 1966

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INC.: REFERENCE IS MADE TO YOUR TELEGRAM OF SEPTEMBER 21. A COMPLETE REPORT RESPONSIVE TO SUCH CONTENTIONS WAS REQUESTED FROM THAT AGENCY. THE ADMINISTRATIVE REPORT IS AS FOLLOWS: "THIS REPORT AND 12 ENCLOSURES RELATING TO THE ABOVE-CAPTIONED MATTER ARE SUBMITTED IN RESPONSE TO YOUR LETTER OF 5 OCTOBER 1966. IS RETURNED AS ENCLOSURE (13). THE PROTEST AND CLAIM ARE BASED UPON THE FOLLOWING ALLEGATIONS: "1. WAS INDUCED BY MISREPRESENTATION OF THE FACTS TO PREPARE AND SUBMIT AN OFFER IN RESPONSE TO MSTS REQUEST FOR PROPOSALS (RFP) NO. THE PERIOD BETWEEN THE CLOSING DATE IN THE RFP AND THE COMMENCEMENT DATE OF THE REQUIRED SERVICE WAS SO SHORT THAT A VESSEL FROM THE EAST COAST OF THE UNITED STATES WOULD NOT HAVE BEEN ABLE TO COMMENCE PERFORMANCE UPON THE SPECIFIED DATE.

B-160110, DEC. 1, 1966

TO THE INTERSTATE ENGINEERING COMPANY, INC.:

REFERENCE IS MADE TO YOUR TELEGRAM OF SEPTEMBER 21, 1966, AND SUBSEQUENT LETTERS WITH ENCLOSURES, IN WHICH YOU PROTECT VARIOUS ACTIONS OF THE MILITARY SEA TRANSPORTATION SERVICE IN SOLICITING PROPOSALS AND AWARDING A CONTRACT UNDER REQUEST FOR PROPOSALS NO. N0003367R0007, DATED JULY 29, 1966, AND IN WHICH YOU SUBMIT A CLAIM AGAINST THE UNITED STATES IN THE AMOUNT OF $137,581.70 FOR YOUR TIME, EXPENSES, OVERHEAD AND ANTICIPATED PROFITS FOR ONE YEAR IN CONNECTION THEREWITH.

IN VIEW OF THE NATURE OF CERTAIN STATEMENTS MADE IN YOUR COMMUNICATIONS AS TO ALLEGED MISREPRESENTATIONS MADE TO MEMBERS OF YOUR FIRM BY VARIOUS OFFICIALS OF THE MILITARY SEA TRANSPORTATION SERVICE, A COMPLETE REPORT RESPONSIVE TO SUCH CONTENTIONS WAS REQUESTED FROM THAT AGENCY. THE ADMINISTRATIVE REPORT IS AS FOLLOWS:

"THIS REPORT AND 12 ENCLOSURES RELATING TO THE ABOVE-CAPTIONED MATTER ARE SUBMITTED IN RESPONSE TO YOUR LETTER OF 5 OCTOBER 1966. THE CLAIMANT'S CLAIM LETTER OF 30 SEPTEMBER 1966, WITH ATTACHMENTS, IS RETURNED AS ENCLOSURE (13).

"A. CLAIMANT'S POSITION.

THE PROTEST AND CLAIM ARE BASED UPON THE FOLLOWING ALLEGATIONS:

"1. INTERSTATE ENGINEERING CO., INC. WAS INDUCED BY MISREPRESENTATION OF THE FACTS TO PREPARE AND SUBMIT AN OFFER IN RESPONSE TO MSTS REQUEST FOR PROPOSALS (RFP) NO. N0003367R0007;

"2. THE PERIOD BETWEEN THE CLOSING DATE IN THE RFP AND THE COMMENCEMENT DATE OF THE REQUIRED SERVICE WAS SO SHORT THAT A VESSEL FROM THE EAST COAST OF THE UNITED STATES WOULD NOT HAVE BEEN ABLE TO COMMENCE PERFORMANCE UPON THE SPECIFIED DATE; AND

"3. THE CONTRACT SHOULD NOT BE AWARDED TO THE UNITED STATES UNDERSEAS CABLE CORP. BECAUSE THE VESSEL OMEGA, WHICH IS TO BE USED IN PERFORMANCE OF THAT CONTRACT, IS NOT CAPABLE OF SUCH PERFORMANCE. (THE AWARD WAS MADE ON 9 SEPTEMBER 1966--- PRIOR TO THE DATE OF CLAIMANT'S LETTER.)

"THE CLAIMANT HAS MADE ACCUSATIONS OF OTHER IRREGULARITIES AND WRONGDOING OF MSTS PERSONNEL WHICH WILL BE COMMENTED UPON.

"B. STATEMENT OF FACTS.

"1. IN RESPONSE TO A REQUIREMENT PLACED BY THE AIR FORCE UPON THE COMMANDER MILITARY SEA TRANSPORTATION SERVICE, (COMSTS) RFP NO. N0003367R0007 OF 29 JULY 1966 WAS MAILED TO 247 ADDRESSES. THE RFP REQUIREMENTS WERE STATED IN TWO PARTS. ONLY PART I IS PERTINENT TO THIS PROTEST. ESSENTIALLY, IT INVITED OFFERS FOR THE CHARTER OF A CABLE REPAIR SHIP AND PERFORMANCE OF A SUBMARINE CABLE REPAIR SERVICE AT SUBIC BAY, PHILIPPINE ISLANDS COMMENCING NOT LATER THAN 1 OCTOBER 1966.

"2. BY MODIFICATION NO. 1 OF 16 AUGUST 1966 THE ON-BERTH DATE AT SUBIC BAY WAS EXTENDED FROM 1 OCTOBER TO 26 OCTOBER 1966, AND THE CLOSING DATE FOR SUBMISSION OF OFFERS WAS EXTENDED TO 1645 HOURS EDST 24 AUGUST 1966.

"3. FOUR OFFERS WERE RECEIVED (RECAPPED IN ENCLOSURE (3) ).

ENCLOSURE

"4. THE LOWEST RESPONSIVE AND RESPONSIBLE OFFEROR WAS THE UNITED STATES UNDERSEAS CABLE CORP. OF WASHINGTON, D.C.; THE NEXT HIGHEST OFFER, OF MARINE ACOUSTICAL SERVICES, INC., OF MIAMI, FLORIDA WAS CONSIDERED NONRESPONSIVE; THE NEXT HIGHEST OFFER WAS THAT OF THE CLAIMANT AND THAT OFFER WAS ALSO CONSIDERED TO BE NONRESPONSIVE. THE ONLY OTHER OFFER RECEIVED WAS THAT OF SIMPLEX WIRE AND CABLE CO. OF PORTSMOUTH, NEW HAMPSHIRE. THIS OFFER, WHILE CONSIDERED RESPONSIVE, WAS THE HIGHEST OFFER RECEIVED.

"5. ALL OFFERS WERE EVALUATED BY THE CONTRACTING OFFICER AFTER HAVING RECEIVED RECOMMENDATIONS OF A CABLE REPAIR SPECIALIST WHO WAS EMPLOYED ON A CONSULTANT BASIS BY MSTS FOR THE PURPOSE OF FURNISHING TECHNICAL ADVICE TO THE CONTRACTING OFFICER.

"6. THE CONTRACTING OFFICER DETERMINED THAT THE OFFER OF UNITED STATES UNDERSEAS CABLE CORP. INVOLVING USE OF THE CABLE SHIP OMEGA WAS MOST FAVORABLE TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED, AND THAT THE UNITED STATES UNDERSEAS CABLE CORP. WAS A RESPONSIBLE OFFEROR; THEREFORE, AWARD WAS MADE TO THAT FIRM ON 9 SEPTEMBER 1966. HIS DETERMINATION WAS MADE AFTER DISCUSSIONS WITH THE CABLE CONSULTANT AND THE AIR FORCE TO CONSIDER THE SMALL SIZE OF THE SHIP AND THE RESULTANT DOUBT WHETHER SHE COULD EFFECT A CABLE REPAIR IN THE DEEPER PORTIONS OF THE CABLE ROUTE.

"7. UNSUCCESSFUL OFFERORS, INCLUDING THE CLAIMANT, WERE NOTIFIED PROMPTLY OF THE AWARD.

"C. DISCUSSION.

"1. THE CLAIMANT HAS ALLEGED THAT CERTAIN FACTS REGARDING THE ACCEPTABILITY OF THE CAPABLE SHIP OMEGA WERE MISREPRESENTED BY MR. W. A. DRISCOLL, CONTRACTING OFFICER, AND MR. HOWARD CRADICK, A CONTRACTING OFFICER'S REPRESENTATIVE, AND THAT IT WAS INDUCED THEREBY TO PREPARE AND SUBMIT AN OFFER. THE CLAIMANT HAS SUBMITTED TWO AFFIDAVITS, ONE OF WHICH MAKES ALLEGATIONS CONCERNING NOT ONLY MESSRS. DRISCOLL AND CRADICK, BUT ALSO VADM G. R. DANAHO, COMMANDER MILITARY SEA TRANSPORTATION SERVICE AND CAPT JOHN P. LIPSCOMB, CONTRACTING OFFICER; VIZ., "AT ONE TIME OR ANOTHER, THEY ALL STATED THAT THE "OMEGA" COULD NOT PERFORM THE NECESSARY WORK REQUIRED BY THE PROPOSAL.' THE COMMANDER, MSTS, AND THE THREE MSTS EMPLOYEES MENTIONED IN THE AFFIDAVIT DENY THE STATEMENTS ATTRIBUTED TO THEM AND FURNISH HEREWITH AFFIDAVITS TO THAT EFFECT.

"2. INTERSTATE ENGINEERING CO., INC. PROTESTS THAT THE PERIOD BETWEEN THE DATE AWARD WAS TO BE MADE AND THE DATE ON WHICH SERVICE WAS TO COMMENCE UNDER THE RFP WAS NOT SUFFICIENT FOR ANY CABLE SHIPS FROM THE EAST COAST OF THE UNITED STATES TO PRESENT ON-BERTH IN THE SUBIC BAY. IT WAS REALIZED BY MSTS PERSONNEL AT THE TIME THE REQUIREMENT WAS PLACED UPON MSTS THAT THE LEAD TIME WAS NECESSARILY SHORT. ACCORDINGLY, IN THE INTEREST OF GENERATING MAXIMUM COMPETITION, COMSTS HAD THE AIR FORCE AMEND ITS THEN CURRENT CONTRACT WITH OMEGA TO EXTEND THE TERMINATION DATE THEREOF FIRST FOR THREE MONTHS AND AGAIN FOR ONE MONTH. IT WAS MADE CLEAR TO THE MSTS PERSONNEL THAT THE AIR FORCE CONTRACTOR WOULD NOT AGREE TO FURTHER EXTENSION OF THE CONTRACT. (SEE ENCL (12) ( UNDER THE CIRCUMSTANCES THE LONGEST POSSIBLE LEAD TIME WAS GIVEN. IN THE INTEREST OF GENERATING MAXIMUM COMPETITION, THE RFP WAS DIRECTED TO PROSPECTIVE OFFERORS HAVING BOTH AMERICAN FLAG SHIPS AND FOREIGN FLAG SHIPS AND TO THOSE HAVING SHIPS THEN POSITIONED ALL OVER THE WORLD. IN FACT, ONE FIRM IN ADDITION TO THE SUCCESSFUL OFFEROR DID SUBMIT A RESPONSIVE OFFER WHICH MET THE TIME FRAME OF THE RFP. THE RFP DID NOT CONTEMPLATE, ALTHOUGH IT DID NOT EXCLUDE, OFFERS WHICH WOULD INVOLVE THE USE OF SHIPS OTHER THAN CABLE SHIPS WHICH WOULD HAVE TO UNDERGO EXTENSIVE CONVERSIONS SUCH AS THAT OFFERED BY THE CLAIMANT.

"3. THE CLAIMANT HAS EXPRESSED THE OPINION THAT THE CONTRACT SHOULD NOT BE AWARDED TO THE UNITED STATES UNDERSEAS CABLE CORP., PRESUMABLY BECAUSE OF THE ALLEGATION THAT "/ITS) VESSEL ,OMEGA" IS NOT CAPABLE OF PERFORMING UNDER THE SPECIFICATIONS OF THE MSTS PROPOSAL ...' AND BECAUSE "THE VESSELL "OMEGA" IS NOT AN AMERICAN FLAG VESSEL.' AS STATED ABOVE, THE RFP DID NOT RESTRICT OFFERS TO AMERICAN FLAG SHIPS. THE SPECIFICATIONS OF THE MSTS RFP REQUIRE SUBSTANTIALLY THE SAME SERVICE AS THAT REQUIRED UNDER PREVIOUS AIR FORCE CONTRACT WITH UNITED STATES UNDERSEAS CABLE CORP. USING THE CABLE SHIP OMEGA. PRIOR TO AWARD, AIR FORCE PERSONNEL RECOMMENDED THAT MSTS ACCEPT THE OFFER OF UNITED STATES UNDERSEAS CABLE CORP. (ENCL (12) ( THE MSTS CONTRACTING OFFICER DETERMINED THAT THIS FIRM WAS RESPONSIBLE WITHIN THE MEANING OF THE ARMED SERVICE PROCUREMENT REGULATION, THAT ITS OFFER WAS RESPONSIVE AND THAT THE ACCEPTANCE OF ITS OFFER WAS MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED.

"4. IN ADDITION TO THE ALLEGATIONS SET FORTH ABOVE, THE CLAIMANT HAS CHARGED MSTS PERSONNEL WITH OTHER IRREGULARITIES:

"A. ON THE FOURTH PAGE OF THE COMPLAINT, IT IS ALLEGED,"DATE OF AUGUST 23, 1966--- MR. DRISCOLL CALLED MR. ODHAM AND ASKED HIM IF WE WERE SUBMITTING A PROPOSAL--- THAT HE WAS IN HOPES WE WOULD.' MR. DRISCOLL DENIES THAT HE PLACED A TELEPHONE CALL TO MR. ODHAM ON THAT DATE AND HAS NO RECOLLECTION OF RECEIVING A TELEPHONE CALL FROM MR. ODHAM.

"B. IT IS ALLEGED ON THE FIFTH PAGE OF THE COMPLAINT THAT IN RESPONSE TO THE QUESTION "IS IT POSSIBLE FOR THE VESSEL "OMEGA" TO EXTEND ITS STAY FOR 30 OR 60 DAYS, ALLOWING AMPLE TIME FOR A REPLACEMENT VESSEL TO ARRIVE? MR. CRADICK ANSWERED,"NO, THE "OMEGA" HAS ANOTHER CHARTER AND MUST BE OFF THE STATION BY NOVEMBER 1, 1966.' MR. CRADICK DENIES HAVING MADE SUCH A STATEMENT.

"C. IT IS ALLEGED ALSO ON THE FIFTH PAGE THAT ON 29 AUGUST IN A TELEPHONE CONVERSATION WITH MR. ODHAM, MR. DRISCOLL TOLD HIM "FOUR BIDS HAD BEEN RECEIVED WHICH WERE MARINE ACOUSTICAL SERVICE, INTERNATIONAL TELEPHONE AND TELEGRAPH, INTERSTATE ENGINEERING CO., INC. AND ONE (1) OTHER WHICH WAS INCONSEQUENTIAL. (SEE ENCL NO. 3) HE FURTHER STATED THAT THE SELECTION HAD BEEN NARROWED TO TWO FIRMS, INTERNATIONAL TEL. AND TEL. AND INTERSTATE ENGINEERING CO., INC.' MR. DRISCOLL DENIES HAVING MADE SUCH A STATEMENT, AND CITES AS PROOF THE FACT THAT NO OFFER HAD BEEN RECEIVED FROM INTERNATIONAL TELEPHONE AND TELEGRAPH.

"D. ON THE SIXTH PAGE OF THE COMPLAINT, IT IS STATED "DATE OF SEPTEMBER 1, 1966--- WE RECEIVED A TELEGRAM SIGNED BY MR. DRISCOLL WHEREIN HE DENIED ANY CONVERSATION BETWEEN MR. CRADICK AND OUR MR. ODHAM AND MR. O-MEILIA ON AUGUST 9, 1966, WHEN HE HIMSELF HAD BEEN PRESENT DURING THE CONVERSATION. (SEE ENCL NO. 10) THIS MATTER IS AGAIN EMPHASIZED IN ITEM 6 OF THE "CONCLUSIONS AND SUMMARY" OF THE PROTEST AND IN QUESTION NO. 5 NEAR THE END OF THE LETTER. MR. DRISCOLL'S TELEGRAM OF 31 AUGUST 1966 IS QUOTED IN PERTINENT PART FOR READY REFERENCE:

"2. THE CONTRACTING OFFICER IS UNAWARE OF ANY CONTRACT BETWEEN YOUR ORGANIZATION AND MR. CRADICK PRIOR TO RELEASE OF SUBJECT INVITATION AND OF ANY SUBSEQUENT CONVERSATION WHEREIN THE STATEMENT ATTRIBUTED TO MR. CRADICK IN YOUR TELEGRAM WAS MADE.'

THE RFP WAS RELEASED ON 29 JULY 1966. IT IS BELIEVED TO BE OBVIOUS FROM EVEN A CASUAL READING OF THE TELEGRAM THAT THE MEANING ATTRIBUTED TO IT BY THE CLAIMANT WAS NOT INTENDED.

"E. IN ITEM 7 OF "CONCLUSIONS AND SUMMARY," IT IS STATED "MR. DRISCOLL MISLED US AGAIN WHEN HE INFORMED MR. ODHAM, ON AUGUST 29, THAT ONE OF TWO FIRMS WOULD BE SELECTED, INTERSTATE ENGINEERING CO., INC. OR INTERNATIONAL TELEPHONE AND TELEGRAPH.' MR. DRISCOLL DENIES SUCH A STATEMENT. STATED ABOVE, NO OFFER WAS RECEIVED FROM INTERNATIONAL TELEPHONE AND TELEGRAPH.

"F. IN ITEM 11 OF THE "CONCLUSIONS AND SUMMARY" IT IS STATED"THE DATES IN THE PROPOSAL WERE SUCH THAT ONLY ONE SHIP COULD HAVE COMPLIED WITH THE TIME TABLE--- THE VESSEL "OMEGA" WHICH WAS ON STATION.' THE FACT IS THAT THE OFFER OF SIMPLEX WIRE AND CABLE CO., EMPLOYING THE CABLE SHIP SALERNUM WAS RESPONSIVE TO THE TIME REQUIREMENTS OF THE RFP. IN ANY EVENT, THE TIME REQUIREMENTS WERE STRETCHED TO THE MAXIMUM.

"G. THE CLAIMANT HAS POSED SIX QUESTIONS ON THE PENULTIMATE PAGE OF ITS COMPLAINT. COGNIZANT MSTS PERSONNEL DENY THE VALIDITY OF THE FACTUAL ASSUMPTIONS ON WHICH THE QUESTIONS ARE BASED, EXCEPT FOR QUESTION NO. 4 THAT ASKS "HOW DID MR. SCHENK OF UNITED STATES UNDERSEA CABLE CO. KNOW WE WERE USING THE VESSEL "PROSPECTOR," IF THIS INFORMATION HAD NOT BEEN SUPPLIED BY PERSONNEL OF MSTS AUGUST 30, 1966? " MSTS DOES NOT KNOW WHERE OR IF MR. SCHENK SECURED THAT INFORMATION. NO PERSONNEL OF MSTS WAS AUTHORIZED TO DIVULGE SUCH INFORMATION AND INVESTIGATION DISCLOSES NO EVIDENCE OF SUCH INFORMATION HAVING BEEN FURNISHED BY MSTS PERSONNEL.

"D. CONCLUSIONS AND RECOMMENDATIONS.

"1. INTERSTATE ENGINEERING CO., INC. WAS NOT INDUCED TO SUBMIT AN OFFER UNDER RFP NO. N0003367R0007 BY MISREPRESENTATION OF FACTS.

"2. THE OFFER SUBMITTED BY INTERSTATE ENGINEERING CO., INC. WAS NOT RESPONSIVE TO RFP NO. N0003367R0007. IT COULD NOT PROPERLY HAVE BEEN CONSIDERED FOR AWARD.

"3. INTERSTATE ENGINEERING CO., INC. IS NOT ENTITLED TO DAMAGES. THE OFFER WHICH IT SUBMITTED WOULD NOT HAVE BEEN LOW AND IT WOULD NOT HAVE BEEN ACCEPTED EVEN HAD UNITED STATES UNDERSEAS CABLE CORP. NOT SUBMITTED A RESPONSIVE OFFER. THEREFORE, ANY DAMAGES WHICH THE CLAIMANT HAS SUFFERED MUST BE ATTRIBUTED TO THE FACT THAT EXPENSES WERE INVOLVED IN PREPARING AND SUBMITTING A NONRESPONSIVE OFFER.

"4. THE OFFER OF UNITED STATES UNDERSEAS CABLE CORP. WAS RESPONSIVE TO RFP NO. N0003367R0007, THE OFFEROR IS RESPONSIBLE AND QUALIFIED TO PERFORM THE CONTRACT, THE PRICE OF THE OFFER WAS LOW AND WAS REASONABLE, AND ACCEPTANCE OF SAME WAS IN THE GOVERNMENT'S BEST INTEREST, PRICE AND OTHER FACTORS CONSIDERED.

"5. THE CLAIMANT HAS NOT STATED ON WHAT THEORY ITS CLAIM HAS BEEN ASSERTED. IT IS NOTED THAT 95 PERCENT OF THE CLAIM IS FOR ANTICIPATED PROFIT FOR ONE YEAR'S OPERATION UNDER THE CONTRACT WHICH CLAIMANT APPARENTLY EXPECTED TO BE AWARDED. THE MERE POSSIBILITY THAT THE CLAIMANT MIGHT HAVE MADE A PROFIT IF CLAIMANT HAD RECEIVED A CONTRACT AS THE RESULT OF ACCEPTANCE OF ITS NONRESPONSIVE OFFER WOULD SEEM TO BE SO REMOTE AS NOT TO DESERVE SERIOUS CONSIDERATION. THE BALANCE OF THE CLAIM WHICH CONSISTS OF COSTS INCIDENT TO PREPARATION OF THE PROPOSAL ARE OF THE NATURE OF EXPENSES WHICH EVERY OFFEROR MUST RISK IN ANTICIPATION OF BEING THE SUCCESSFUL OFFEROR. "6. IT IS RECOMMENDED THAT THE CLAIM BE DENIED IN TOTO.'

WE FEEL THAT THE ABOVE REPORT REFLECTS A CAREFUL ANALYSIS OF YOUR PROTEST AND CLAIM, PRESENTS A VERY COMPREHENSIVE AND ORDERLY STATEMENT OF THE FACTS AS THEY RELATE THERETO, AND CONSTITUTES ADEQUATE RESPONSE TO THOSE MATTERS WHICH ARE NOT FURTHER CONSIDERED HEREIN.

AS INDICATED IN THAT REPORT, YOUR OFFER WAS NONRESPONSIVE IN THAT YOUR TIME SCHEDULE DID NOT COMPLY WITH THE MATERIAL RFP REQUIREMENT FOR PRESENTING A CABLE SHIP AT SUBIC BAY, PHILIPPINE ISLANDS, NOT LATER THAN OCTOBER 26, 1966, AND, CONTRARY TO YOUR CONTENTION, THE FACTS SHOW THAT IT WAS POSSIBLE FOR SUCH TENDERING DATE TO BE MET BY OFFERORS WITH CABLE VESSELS SITUATED ON THE EAST COAST OF THE UNITED STATES. ALSO, WHILE THERE APPEARS TO HAVE BEEN SOME QUESTION AS TO WHETHER THE RELATIVELY SMALL SIZE OF THE SHIP OMEGA OFFERED BY THE UNITED STATES UNDERSEAS CABLE CORPORATION WAS SUFFICIENT TO ENABLE IT TO MAKE CABLE REPAIRS IN THE DEEPER AREAS OF THE CABLE ROUTE, SUCH SHIP WAS DETERMINED BY THE CONTRACTING OFFICER TO BE ACCEPTABLE ONLY AFTER OBTAINING FAVORABLE RECOMMENDATIONS FROM DEPARTMENTAL EXPERTS IN SUCH MATTERS. IN THE ABSENCE OF FACTUAL INFORMATION DEFINITELY ESTABLISHING THAT THE SHIP IS INADEQUATE FOR PERFORMANCE OF THE WORK REQUIRED WE ARE NOT INCLINED TO QUESTION THE CONTRACTING OFFICER'S DETERMINATION IN THAT RESPECT. SEE PARAGRAPH NO. 3 OF THE RFP WHICH SPECIFICALLY PROVIDES:

"THE VESSEL SHALL BE SUBJECT TO THE GOVERNMENT'S INSPECTION AS TO THE SUITABILITY OF THE VESSEL FOR THE REQUIRED SERVICE. IF IN THE OPINION OF THE GOVERNMENT INSPECTOR, THE VESSEL IS INADEQUATE FOR THE INTENDED SERVICE, THE GOVERNMENT RESERVES THE RIGHT TO REJECT THE VESSEL. THE DECISION OF THE CONTRACTING OFFICER REGARDING THE ADEQUACY OF THE VESSEL BASED ON THE INSPECTION SHALL BE FINAL.'

ACCORDINGLY, WE CANNOT CONCLUDE THAT THE AWARD WAS NOT MADE TO THE LOWEST RESPONSIVE AND RESPONSIBLE OFFEROR OR THAT THE AWARD WAS NOT IN THE BEST INTERESTS OF THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED, AND YOUR PROTEST INSOFAR AS IT OBJECTS TO SUCH AWARD MUST BE DENIED.

WHILE THE ABOVE POINTS ARE INVOLVED TO SOME MINOR EXTENT IN YOUR COMMUNICATIONS, IT DOES NOT APPEAR THAT YOU ARE MAINTAINING THAT YOU SUBMITTED THE LOW RESPONSIVE OFFER, BUT INSTEAD IT APPEARS THAT YOUR PROTEST AND ACCOMPANYING CLAIM ARE BASED ON THE PRINCIPAL CONTENTION THAT IT WAS NOT POSSIBLE FOR YOU TO BID COMPETITIVELY AGAINST THE VESSEL OMEGA, AND THAT INTENTIONALLY, OR UNINTENTIONALLY, THE TRUE FACTS REGARDING THE ACCEPTABILITY OF THAT SHIP WERE MISREPRESENTED BY MSTS OFFICIALS THEREBY CAUSING AN UNWARRANTED EXPENDITURE OF YOUR FUNDS IN PREPARING A PROPOSAL WHICH OTHERWISE WOULD NOT HAVE BEEN PRESENTED IF THE TRUE FACTS HAD BEEN MADE KNOWN TO YOU IN RESPONSE TO YOUR INQUIRIES. IN SUCH CONNECTION IT IS NOTED THAT YOU STATE IN YOUR MOST RECENT LETTER TO THIS OFFICE, IN WHICH YOU COMMENT ON MSTS LETTER TO YOU OF SEPTEMBER 30, 1966, THAT ,WHETHER OUR BID WAS DECLARED NONRESPONSIVE IS NOT THE QUESTION AND IT IS CERTAINLY NOT ON POINT WITH OUR CLAIM.' WE FIND THAT RATIONALE SOMEWHAT DIFFICULT TO FOLLOW INASMUCH AS $131,965.75 OF THE CLAIM IS FOR LOSS OF ANTICIPATED PROFITS FOR THE FIRST YEAR, AND IT APPEARS THAT YOUR REALIZATION OF ANY PROFIT IN THE MATTER WOULD DEPEND, IN THE FIRST INSTANCE, UPON YOUR OBTAINING THE AWARD THROUGH AN OFFER THAT IS RESPONSIVE TO ALL MATERIAL REQUIREMENTS OF THE RFP. SEE, HOWEVER, HEYER PRODUCTS COMPANY, INC. V. THE UNITED STATES, 135 CT.CL. 63, 140 F.SUPP. 409, WHEREIN IT IS STATED:

"THE ADVERTISEMENT FOR BIDS WAS, OF COURSE, A REQUEST FOR OFFERS TO SUPPLY THE THINGS THE ORDINANCE DEPARTMENT WANTED. IT WOULD ACCEPT OR REJECT AN OFFER AS IT PLEASED, AND NO CONTRACT RESULTED UNTIL AN OFFER WAS ACCEPTED. HENCE, AN UNSUCCESSFUL BIDDER CANNOT RECOVER THE PROFIT HE WOULD HAVE MADE OUT OF THE CONTRACT, BECAUSE HE HAD NO CONTRACT.'

REGARDING YOUR BASIC ALLEGATION THAT CERTAIN STATEMENTS AND MISREPRESENTATIONS WERE MADE BY MSTS PERSONNEL AS TO THE ACCEPTABILITY OF THE OMEGA, IN SUPPORT OF WHICH YOU HAVE FURNISHED SWORN AFFIDAVITS BY MR. CHARLES R. O-MEILIA AND MR. WARREN L. ODHAM, SR., OF YOUR ORGANIZATION, THE MSTS PERSONNEL INVOLVED NOT ONLY CATEGORICALLY DENY HAVING MADE ANY SUCH STATEMENTS, AS WELL AS VARIOUS OTHERS ATTRIBUTED TO THEM, BUT THEY HAVE ALSO FURNISHED SWORN AFFIDAVITS AND STATEMENTS TO THAT EFFECT.

THE AFFIDAVIT OF ADMIRAL DONOHO IS AS FOLLOWS:

"I, GLYNN R. DONAHO, OF WASHINGTON, D.C., BEING DULY SWORN, DEPOSE AND SAY THAT:

"1. I AM COMMANDER OF MILITARY SEA TRANSPORTATION SERVICE, U.S. NAVY, WITH HEADQUARTERS IN WASHINGTON, D.C., AND THAT IN LINE OF DUTY I HAVE READ THE LETTER OF 5 OCTOBER 1966, SIGNED BY M. E. MILLER, ASSISTANT GENERAL COUNSEL, UNITED STATES GENERAL ACCOUNTING OFFICE IN THE CAPTIONED CASE, THE LETTER ENCLOSED WITH IT DATED 30 SEPTEMBER 1966 AND ATTACHMENTS THERETO FROM INTERSTATE ENGINEERING COMPANY, INC.

"2. I HAVE READ IN PARTICULAR THE SWORN STATEMENT OF WARREN L. ODHAM, SR., DATED 26 SEPTEMBER 1966 WHICH IS ATTACHED THERETO AS ENCLOSURE (3), THE EIGHTH PARAGRAPH OF WHICH STATES:

"DURING THE PERIOD FROM AUGUST 9, 1966, UNTIL THE 24TH WE HAD MANY TELEPHONE CONVERSATIONS WITH MSTS, INCLUDING GLEN R. DONAHO, VICE ADMIRAL, U.S.N., CAPTAIN LIPSCOMB, U.S.N., W. A. DRISCOLL AND MR. CRADICK. AT ONE TIME OR ANOTHER, THEY ALL STATED THAT THE "OMEGA" COULD NOT PERFORM THE NECESSARY WORK REQUIRED BY THE PROPOSAL.

"3. I DENY HAVING MADE TO ANY KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. AT ANY TIME SUCH STATEMENT OR ANY OTHER STATEMENT TO THE EFFECT THAT THE CABLE SHIP OMEGA WOULD NOT BE AN ACCEPTABLE SHIP UNDER MILITARY SEA TRANSPORTATION SERVICE REQUEST FOR PROPOSALS NO. N0003367R0007.

"4. I HAVE NO RECOLLECTION OF ANY TELEPHONE CONVERSATIONS WITH MR. ODHAM OR WITH ANY KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. DURING THE PERIOD FROM 9 AUGUST 1966 TO 24 AUGUST 1966; THAT IT IS MY UNVARYING PRACTICE TO MAKE WRITTEN MEMORANDA FOR THE RECORD OF TELEPHONE CONVERSATIONS; THAT I HAVE SEARCHED THE RECORDS OF MY TELEPHONE CONVERSATIONS OCCURRING DURING SAID PERIOD AND THAT NO MEMORANDUM OF A TELEPHONE CONVERSATION WITH ANY KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. HAS BEEN FOUND.'

MR. LIPSCOMB'S AFFIDAVIT READS:

"I, J. W. LIPSCOMB, OF BETHESDA, MARYLAND, AFTER BEING DULY SWORN, DEPOSE AND SAY THAT:

"1. I AM A CONTRACTING OFFICER OF MILITARY SEA TRANSPORTATION SERVICE, U.S. NAVY, WITH HEADQUARTERS IN WASHINGTON, D.C., AND THAT IN LINE OF DUTY I HAVE READ LETTER OF 5 OCTOBER 1966 SIGNED BY M. E. MILLER, ASSISTANT GENERAL COUNSEL, UNITED STATES GENERAL ACCOUNTING OFFICE IN THE CAPTIONED CASE, THE LETTER ENCLOSED WITH IT DATED 30 SEPTEMBER 1966 AND ATTACHMENTS THERETO FROM INTERSTATE ENGINEERING CO., INC.

"2. I HAVE READ IN PARTICULAR THE SWORN STATEMENT OF WARREN L. ODHAM, SR. DATED 26 SEPTEMBER 1966, WHICH IS ATTACHED THERETO AS ENCLOSURE (3), THE EIGHTH PARAGRAPH OF WHICH STATES:

"DURING THE PERIOD FROM AUGUST 9, 1966, UNTIL THE 24TH, WE HAD MANY TELEPHONE CONVERSATIONS WITH MSTS, INCLUDING GLEN R. DONAHO, VICE ADMIRAL, U.S.N., CAPTAIN LIPSCOMB, U.S.N., W. A. DRISCOLL AND MR. CRADICK. AT ONE TIME OR ANOTHER, THEY ALL STATED THAT THE "OMEGA" COULD NOT PERFORM THE NECESSARY WORK REQUIRED BY THE PROPOSAL.'

"3. I DENY HAVING MADE TO ANY KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. AT ANY TIME SUCH STATEMENT OR OTHER STATEMENT TO THE EFFECT THAT THE CABLE SHIP OMEGA WOULD NOT BE AN ACCEPTABLE SHIP UNDER MILITARY SEA TRANSPORTATION SERVICE REQUEST FOR PROPOSALS NO. 003367R0007.'

MR. DRISCOLL'S STATEMENT IS:

"I, W. A. DRISCOLL, OF KENSINGTON, MARYLAND DEPOSE AND SAY THAT:

"1. I AM A CONTRACTING OFFICER OF MILITARY SEA TRANSPORTATION SERVICE, U.S. NAVY, WITH HEADQUARTERS IN WASHINGTON, D.C., AND THAT IN LINE OF DUTY I HAVE READ THE LETTER OF 5 OCTOBER 1966 SIGNED BY M. E. MILLER, ASSISTANT GENERAL COUNSEL, UNITED STATES GENERAL ACCOUNTING OFFICE IN THE CAPTIONED CASE, THE LETTER ENCLOSED WITH IT DATED 30 SEPTEMBER 1966 AND ATTACHMENTS THERETO FROM INTERSTATE ENGINEERING CO., INC.

"2. I HAVE READ IN PARTICULAR THE SWORN STATEMENTS OF CHARLES R. O MEILIA DATES 9 SEPTEMBER 1966 AND OF WARREN L. ODHAM, SR., DATED 26 SEPTEMBER 1966.

"3. I DENY HAVING MADE A STATEMENT AT ANY TIME TO MR. O-MEILIA OR TO MR. ODHAM, OR TO ANY OTHER KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. TO THE EFFECT THAT THE CABLE SHIP OMEGA WOULD NOT BE ACCEPTABLE SHIP UNDER MSTS REQUEST FOR PROPOSALS NO. N0003367R0007.

"4. I DENY HAVING TOLD MR. ODHAM OR ANY OTHER KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. ON 29 AUGUST 1966 OR AT ANY OTHER TIME THE NAMES OF THE FIRMS WHICH HAD SUBMITTED OFFERS UNDER RFP NO. N0003367R0007 OTHER THAN THE SUCCESSFUL OFFEROR.

"5. I HAVE NO KNOWLEDGE OF ANY STATEMENT MADE BY MR. HOWARD CRADICK OR ANY OTHER MSTS REPRESENTATIVE TO ANY KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. TO THE EFFECT THAT THE CABLE SHIP OMEGA WOULD NOT BE AN ACCEPTABLE SHIP UNDER RFP NO. N0003367R0007.'

LASTLY, THE STATEMENT OF MR. CRADICK PROVIDES:

"I, H. D. CRADICK, OF KENSINGTON, MARYLAND, DEPOSE AND SAY THAT:

"1. I AM A SHIP CHARTER NEGOTIATOR EMPLOYED BY MILITARY SEA TRANSPORTATION SERVICE, U.S. NAVY, WITH HEADQUARTERS IN WASHINGTON, D.C., AND IN SUCH CAPACITY I AM A REPRESENTATIVE OF THOSE MSTS CONTRACTING OFFICERS RESPONSIBLE FOR THE CHARTER OF SHIPS.

"2. IN THE LINE OF MY DUTY, I HAVE READ THE LETTER OF 5 OCTOBER 1966 SIGNED BY M. E. MILLER, ASSISTANT GENERAL COUNSEL, UNITED STATES GENERAL ACCOUNTING OFFICE IN THE CAPTIONED CASE, THE LETTER ENCLOSED WITH IT DATED 30 SEPTEMBER 1966 AND ATTACHMENTS THERETO FROM INTERSTATE ENGINEERING CO., INC.

"3. I HAVE READ IN PARTICULAR THE SWORN STATEMENTS OF CHARLES R. O MEILIA DATED 9 SEPTEMBER 1966 AND OF WARREN L. ODHAM, SR., DATED 26 SEPTEMBER 1966.

"4. I DENY HAVING MADE A STATEMENT AT ANY TIME TO MR. O-MEILIA OR TO MR. ODHAM, OR TO ANY OTHER KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC. TO THE EFFECT THAT THE CABLE SHIP OMEGA WOULD NOT BE AN ACCEPTABLE SHIP UNDER MSTS REQUEST FOR PROPOSALS NO. N0003367R0007. I HAVE NO KNOWLEDGE OF ANY SUCH STATEMENT HAVING BEEN MADE BY MR. W. A. DRISCOLL OR ANY OTHER MSTS REPRESENTATIVE TO ANY KNOWN REPRESENTATIVE OF INTERSTATE ENGINEERING CO., INC.'

UPON DISPUTED QUESTIONS OF FACT, SUCH AS HERE, BETWEEN OFFICIALS OF THE GOVERNMENT AND A CLAIMANT OR OTHER PERSON DEALING WITH THE GOVERNMENT, IT IS THE LONG-ESTABLISHED RULE OF THE ACCOUNTING OFFICERS TO ACCEPT THE FACTS AS ADMINISTRATIVELY REPORTED, RATHER THAN AS STATED BY THE CLAIMANT, IN THE ABSENCE OF EVIDENCE SUFFICIENT TO OVERCOME THE PRESUMPTION OF THE CORRECTNESS OF THE ADMINISTRATIVE STATEMENTS OR UNLESS THE ADMINISTRATIVE VERSION IS CLEARLY UNSUPPORTABLE. 3 COMP. GEN. 51; 16 ID. 325. IN VIEW OF THE AFFIDAVITS AND STATEMENTS FURNISHED BY THE MSTS OFFICIALS WHICH DENY THAT REPRESENTATIVES OF YOUR FIRM WERE ADVISED BY SUCH OFFICIALS THAT THE OMEGA WOULD NOT BE AN ACCEPTABLE SHIP FOR THE PROPOSED CONTRACT, AND SINCE YOU HAVE SUBMITTED NO STRONGER EVIDENCE TO ESTABLISH THAT SUCH STATEMENTS WERE IN FACT MADE, THE PRESENT RECORD DOES NOT AFFORD US A PROPER BASIS FOR NOT ACCEPTING THE ADMINISTRATIVE VERSION.

HOWEVER, EVEN IF MSTS PERSONNEL HAD EXPRESSED THE VIEW TO YOUR REPRESENTATIVES THAT THE OMEGA WAS NOT CAPABLE OF HANDLING THE CONTRACT TO THE SATISFACTION OF THE GOVERNMENT, AND UPON SUBSEQUENT EVALUATION OF THE SHIP'S CAPABILITIES DETERMINED THAT SUCH SHIP WAS ACCEPTABLE, YOUR CLAIM FOR REIMBURSEMENT OF THE EXPENSES INCURRED BY YOU IN SUBMITTING YOUR PROPOSAL, ETC., WOULD NOT BE ALLOWABLE ON THE BASIS OF THAT FACTOR ALONE, SINCE THE STATUTES REQUIRING SOLICITATION OF COMPETITIVE OFFERS TO SUPPLY THE GOVERNMENT'S NEEDS WERE ENACTED FOR THE BENEFIT OF THE GOVERNMENT, AND NOT FOR THE BENEFIT OF PROSPECTIVE CONTRACTORS. THE COURTS HAVE THEREFORE CONSISTENTLY HELD THAT SUCH PROSPECTIVE CONTRACTORS HAVE NO ENFORCEABLE RIGHTS IN THE EVENT THEY ARE NOT AWARDED THE CONTRACT. SEE PERKINS V. LUKENS STEEL COMPANY, 310 U.S. 113; COLORADO PAVING COMPANY V. MURPHY, 78 F. 28; AND HEYER PRODUCTS COMPANY V. UNITED STATES, SUPRA. IN THE HEYER PRODUCTS CASE THE COURT STATED THE RULE:

"IT GOES WITHOUT SAYING THAT NOT EVERY UNSUCCESSFUL BIDDER IS ENTITLED TO RECOVER THE COST OF PUTTING IN HIS BID. RECOVERY CAN BE HAD IN ONLY THOSE CASES WHERE IT CAN BE SHOWN BY CLEAR AND CONVINCING PROOF THAT THERE HAS BEEN A FRAUDULENT INDUCEMENT FOR BIDS, WITH THE INTENTION, BEFORE THE BIDS WERE INVITED OR LATER CONCEIVED, TO DISREGARD THEM ALL EXCEPT THE ONES FROM BIDDERS TO ONE OF WHOM IT WAS INTENDED TO LET THE CONTRACT, WHETHER HE WAS THE LOWEST RESPONSIBLE BIDDER OR NOT. IN OTHER WORDS, IT MUST BE SHOWN THAT BIDS WERE NOT INVITED IN GOOD FAITH, BUT AS A PRETENSE TO CONCEAL THE PURPOSE TO LET THE CONTRACT TO SOME FAVORED BIDDER, OR TO ONE OF A GROUP OF PREFERRED BIDDERS, AND WITH THE INTENT TO WILFULLY, CAPRICIOUSLY, AND ARBITRARILY DISREGARD THE OBLIGATION TO LET THE CONTRACT TO HIM WHOSE BID WAS MOST ADVANTAGEOUS TO THE GOVERNMENT.'

IN SHORT, BEFORE BID PREPARATION EXPENSES MAY BE ALLOWED, THE FACTS MUST SHOW A CASE OF DISCRIMINATION AGAINST THE UNSUCCESSFUL BIDDER AND OF FAVORITISM TOWARD THE SUCCESSFUL BIDDER. ALSO, SEE HEYER PRODUCTS COMPANY, INC. V. UNITED STATES, 147 CT.CL. 256, 177 F.SUPP. 251. WE DO NOT BELIEVE THAT THE RECORD IN THIS CASE ESTABLISHES THAT MSTS SOLICITED PROPOSALS FROM THE PROSPECTIVE CONTRACTORS IN BAD FAITH, OR ESTABLISHES ANY ARBITRARY, CAPRICIOUS OR DISCRIMINATORY ACTIONS AGAINST YOUR FIRM BY THAT AGENCY AND FAVORITISM TOWARDS THE UNITED STATES UNDERSEAS CABLE CORPORATION. IN VIEW OF THE FOREGOING, WE MUST CONCLUDE THAT THERE IS NO LEGAL BASIS ON WHICH TO ALLOW ANY ..END :