B-167152-/2), AUG. 14, 1969

B-167152-/2): Aug 14, 1969

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BID PROTEST - COMPETITION RESTRICTION LETTER TO SECRETARY OF NAVY SUGGESTING THAT DEPARTMENT SHOULD HAVE LOOKED INTO FACTS SURROUNDING THE MAILING OF A LETTER BY THE SUCCESSFUL BIDDER TO OTHER BIDDERS SINCE IT IS A DEPARTMENTAL RESPONSIBILITY TO GUARD AGAINST NONCOMPETITIVE PRACTICES BY BIDDERS INCLUDING PRACTICES DESIGNED TO ELIMINATE COMPETITION. SECRETARY: REFERENCE IS MADE TO THE PROTEST BY AIRTEK CORPORATION AGAINST THE AWARD TO HERMET MANUFACTURING CORPORATION UNDER INVITATION FOR BIDS NO. THIS MATTER WAS THE SUBJECT OF A REPORT FROM YOUR DEPARTMENT DATED JUNE 19. THE PROTEST WAS FILED AS A RESULT OF A LETTER ADDRESSED "TO WHOM IT MAY CONCERN. " WHICH THE CONTRACTOR WAS ALLEGED TO HAVE MAILED TO SEVERAL OF THE PROSPECTIVE BIDDERS JUST PRIOR TO THE BID OPENING.

B-167152-/2), AUG. 14, 1969

BID PROTEST - COMPETITION RESTRICTION LETTER TO SECRETARY OF NAVY SUGGESTING THAT DEPARTMENT SHOULD HAVE LOOKED INTO FACTS SURROUNDING THE MAILING OF A LETTER BY THE SUCCESSFUL BIDDER TO OTHER BIDDERS SINCE IT IS A DEPARTMENTAL RESPONSIBILITY TO GUARD AGAINST NONCOMPETITIVE PRACTICES BY BIDDERS INCLUDING PRACTICES DESIGNED TO ELIMINATE COMPETITION.

TO MR. SECRETARY:

REFERENCE IS MADE TO THE PROTEST BY AIRTEK CORPORATION AGAINST THE AWARD TO HERMET MANUFACTURING CORPORATION UNDER INVITATION FOR BIDS NO. N62464- 69-C-0005, ISSUED BY THE NAVAL FACILITIES ENGINEERING COMMAND, BOSTON, MASSACHUSETTS, FOR A STEEL STACK FOR A BOILER AT THE BOSTON NAVAL SHIPYARD. THIS MATTER WAS THE SUBJECT OF A REPORT FROM YOUR DEPARTMENT DATED JUNE 19, 1969, REFERENCE: 0211C/RP/KAM.

THE PROTEST WAS FILED AS A RESULT OF A LETTER ADDRESSED "TO WHOM IT MAY CONCERN," WHICH THE CONTRACTOR WAS ALLEGED TO HAVE MAILED TO SEVERAL OF THE PROSPECTIVE BIDDERS JUST PRIOR TO THE BID OPENING, STATING AS FOLLOWS:

"IN CONNECTION WITH ANY CONTEMPLATED BIDS ON AIR-SEALED, DOUBLE SHELL, STEEL STACKS OR BREECHINGS, WE WISH TO POINT OUT THAT ANY ATTEMPT TO INFRINGE ON OUR UNITED STATES PATENTS (NOS. 3,302,599, 3,363,591 AND 3,368,506) COVERING THE DESIGNS OF SAID HERMETICALLY AIR SEALED, DOUBLE WALL STACKS OR BREECHINGS WILL RESULT IN OUR TAKING PROPER ACTION UNDER THE LAW TO PROTECT OUR UNITED STATES' PATENT INTERESTS.'

AIRTEK CONTENDED THAT THE MAILING OF THIS LETTER JUST PRIOR TO THE BID OPENING HAD THE EFFECT OF RESTRICTING COMPETITION AND CONSTITUTED A VIOLATION OF THE CERTIFICATE OF INDEPENDENT PRICE DETERMINATION ON THE PART OF THE SENDER OF THE LETTER, NAMELY, THE LOW BIDDER, HERMET CORPORATION. YOUR DEPARTMENT REPORTED TO US THAT IT HAD "NO INDEPENDENT KNOWLEDGE OF THE MAILING OF THE LETTER IN QUESTION TO PROSPECTIVE BIDDERS" BUT THAT, IN ANY EVENT,"WHETHER SUCH MATERIAL WAS OR WAS NOT MAILED WOULD APPEAR TO BE IRRELEVANT TO THE RESPONSIVENESS OF THE LOW BIDDER.'

BY OUR DECISION OF TODAY, COPY ENCLOSED, WE DENIED AIRTEK'S PROTEST AGAINST THE AWARD. HOWEVER, BEFORE REACHING OUR CONCLUSION WE WROTE TO HERMET CORPORATION INQUIRING WHETHER IT DID IN FACT MAIL THE LETTER OF JANUARY 3RD AND, IF SO, WHY. BY LETTER DATED JULY 31, 1969, WE WERE ADVISED BY HERMET THAT THE "TO WHOM IT MAY CONCERN" LETTER WAS A GENERAL FORM LETTER USED BY HERMET FROM TIME TO TIME AND HAD NO SPECIFIC REFERENCE TO THE SUBJECT CONTRACT. WE ACCEPTED THIS EXPLANATION AND THUS CONCLUDED THAT THE LETTER, ALTHOUGH MAILED BY HERMET, WAS SENT IN GOOD FAITH AND WITHOUT ANY INTENT TO INDUCE OTHER FIRMS NOT TO COMPETE FOR THE SUBJECT AWARD.

WE MENTION THESE FACTS BECAUSE IT APPEARS THAT YOUR DEPARTMENT IS NOT CONCERNED WHETHER THE LETTER OF JANUARY 3, 1969, WAS OR WAS NOT SENT (ALTHOUGH THERE IS AN INDICATION IN THE HERMET LETTER OF JULY 31, 1969 THAT YOUR DEPARTMENT DID INQUIRE OF HERMET REGARDING THE LETTER IN QUESTION PRIOR TO THE AWARD). IN ANY EVENT, AS YOU ARE FULLY AWARE, IT IS A DEPARTMENTAL RESPONSIBILITY TO GUARD AGAINST ALL NONCOMPETITIVE PRACTICES BY BIDDERS, INCLUDING PRACTICES WHICH ARE DESIGNED TO ELIMINATE COMPETITION. ASPR 1-111.2 (A) AND ASPR 1-115. IN VIEW OF THIS RESPONSIBILITY, WE BELIEVE THAT YOUR DEPARTMENT SHOULD HAVE ATTEMPTED TO DETERMINE THE FACTS SURROUNDING THE SENDING OF THE LETTER IN QUESTION.