B-169261, JUN. 5, 1970

B-169261: Jun 5, 1970

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PROPRIETARY DATA BASIS REQUEST FOR CANCELLATION OF REQUEST FOR PROPOSALS AND NEGOTIATION ON SOLE SOURCE BASIS WITH COMPANY ON BASIS THAT SUFFICIENT DESCRIPTIVE DATA CANNOT BE FURNISHED PROSPECTIVE OFFERORS WITHOUT VIOLATING PROPRIETARY RIGHTS IS DENIED. BECAUSE PROCURING AGENCY IS CONVINCED PERFORMANCE IS POSSIBLE WITHOUT USING PROPRIETARY DATA. AGENCY'S POSITION WILL NOT BE QUESTIONED. A DIVISION OF ITEK CORPORATION: THIS IS IN REPLY TO YOUR LETTERS OF MARCH 5 AND 18. THESE DISPLAYS ARE TO BE REPRODUCED FROM TAPES RECORDED BY YOUR ARRS-100 OR EQUIVALENT RECORDING SYSTEM. THE AIR FORCE HAS REPORTED THAT SINCE ENGINEERING DATA FOR COMPETITIVE PROCUREMENT WAS NOT AVAILABLE. POTENTIAL SOURCES WERE SELECTED FOR NEGOTIATION ON THE BASIS OF THEIR TECHNICAL KNOWLEDGE AND FAMILIARITY WITH THE EQUIPMENT INVOLVED.

B-169261, JUN. 5, 1970

CONTRACTS--NEGOTIATION--COMPETITION--PROPRIETY--PROPRIETARY DATA BASIS REQUEST FOR CANCELLATION OF REQUEST FOR PROPOSALS AND NEGOTIATION ON SOLE SOURCE BASIS WITH COMPANY ON BASIS THAT SUFFICIENT DESCRIPTIVE DATA CANNOT BE FURNISHED PROSPECTIVE OFFERORS WITHOUT VIOLATING PROPRIETARY RIGHTS IS DENIED, NO DATA BEARING PROPRIETARY LEGEND TO BE FURNISHED OFFERORS, BUT WITH REGARD TO TECHNICAL MANUALS, GOVERNMENT ACQUIRED MANUALS UNDER ORDERS AGAINST BASIC ORDERING AGREEMENTS WHICH CONTAINED "RIGHTS IN TECHNICAL DATA" CLAUSE GRANTING GOVERNMENT UNLIMITED RIGHTS IN BOTH TECHNICAL DATA AND MANUALS. BECAUSE PROCURING AGENCY IS CONVINCED PERFORMANCE IS POSSIBLE WITHOUT USING PROPRIETARY DATA, AGENCY'S POSITION WILL NOT BE QUESTIONED.

TO APPLIED TECHNOLOGY, A DIVISION OF ITEK CORPORATION:

THIS IS IN REPLY TO YOUR LETTERS OF MARCH 5 AND 18, 1970, AND ENCLOSURES, IN WHICH YOU REQUEST THAT WE DIRECT CANCELLATION OF REQUEST FOR PROPOSALS F04606-70-R-0167, ISSUED BY THE SACRAMENTO AIR MATERIEL AREA OR, IN THE ALTERNATIVE, THAT THE PROCURING ACTIVITY BE DIRECTED TO ENTER INTO SOLE SOURCE NEGOTIATIONS WITH YOUR COMPANY.

THE SOLICITATION STATES A REQUIREMENT FOR NINE WILD WEASEL TRAINING DISPLAYS AND RELATED DATA, WITH UNLIMITED RIGHTS IN SUCH DATA ACCRUING TO THE GOVERNMENT. THIS EQUIPMENT MUST BE CAPABLE OF REPRODUCING AND DISPLAYING THE RADAR WARNING AND ALARM SIGNALS GENERATED BY EQUIPMENT MANUFACTURED BY YOUR COMPANY AND IDENTIFIED AS THE AN/APR-25/36 AND AN/APR -26/37 AZIMUTH INDICATOR AND THREAT DISPLAY UNIT, AS WELL AS AIRCRAFT COMMUNICATIONS, INTERPHONE AUDIO, AND ELAPSED TIME. THESE DISPLAYS ARE TO BE REPRODUCED FROM TAPES RECORDED BY YOUR ARRS-100 OR EQUIVALENT RECORDING SYSTEM.

THE AIR FORCE HAS REPORTED THAT SINCE ENGINEERING DATA FOR COMPETITIVE PROCUREMENT WAS NOT AVAILABLE, POTENTIAL SOURCES WERE SELECTED FOR NEGOTIATION ON THE BASIS OF THEIR TECHNICAL KNOWLEDGE AND FAMILIARITY WITH THE EQUIPMENT INVOLVED. YOUR COMPANY WAS SELECTED SINCE YOU PERFORMED PHASE I AND PHASE II ENGINEERING ON THE WILD WEASEL RADAR SYSTEMS AND THE 14-CHANNEL RECORDER SYSTEMS. ANOTHER CONCERN WAS SELECTED ON THE BASIS OF THE KNOWLEDGE AND BACKGROUND OF ITS ENGINEERING AND TECHNICAL PERSONNEL WHICH WAS GAINED DURING THEIR FORMER ASSOCIATION WITH YOUR FIRM DURING THE ABOVE MENTIONED PROGRAMS AND IN THE COURSE OF THEIR SUCCESSFUL PERFORMANCE OF A FIELD SERVICE CONTRACT ON A 14-CHANNEL RECORDER.

IT IS YOUR POSITION THAT THE AIR FORCE SHOULD NOT HAVE ISSUED A COMPETITIVE SOLICITATION. YOU STATE THAT, FOR THE TRAINING DISPLAY TO BE COMPATIBLE WITH YOUR EQUIPMENT, A DETAILED AND COMPLETE KNOWLEDGE OF THE RELATED EQUIPMENT IS NECESSARY. THIS, YOU STATE, CANNOT BE OBTAINED BY A DETAILED EXAMINATION OF THE HARDWARE ALONE BUT CAN BE GAINED ONLY FROM APPLIED TECHNOLOGY DATA WHICH HAS BEEN FURNISHED TO THE GOVERNMENT WITH LIMITED RIGHTS. YOU THEREFORE CONTEND THAT THE GOVERNMENT HAS NOT PROVIDED PROSPECTIVE OFFERORS WITH A SUFFICIENT DESCRIPTION OF THE RELATED EQUIPMENT MADE BY YOUR COMPANY, AND THAT THE GOVERNMENT CANNOT PROPERLY PROVIDE SUCH DESCRIPTIVE DATA WITHOUT VIOLATING YOUR PROPRIETARY RIGHTS. ADDITIONALLY, YOU STATE THAT THE GOVERNMENT'S REQUEST FOR UNLIMITED RIGHTS IN DATA FOR THE TRAINING DISPLAY IS PREJUDICIAL TO YOUR FIRM SINCE THIS REQUIREMENT WOULD NECESSARILY INCLUDE THE PROPRIETARY DATA RELATING TO YOUR EQUIPMENT. FINALLY, YOU OBJECT TO A SOLICITATION PROVISION WHEREIN THE GOVERNMENT ADVISES THAT IT WILL FURNISH TO THE SUCCESSFUL CONTRACTOR THE FAIRCHILD HILLER, REPUBLIC AVIATION DRAWING 105G805004, SINCE THIS DRAWING IS BASED UPON AND MAKES REFERENCE TO AN APPLIED TECHNOLOGY DRAWING WHICH YOU CONTEND WAS FURNISHED TO FAIRCHILD-HILLER BY YOUR FIRM WITH A LIMITED RIGHTS LEGEND ATTACHED.

IN ITS REPORT TO THIS OFFICE DATED MAY 7, 1970, THE AIR FORCE HAS STATED THAT NONE OF THE DATA BEARING A PROPRIETARY LEGEND WHICH YOUR COMPANY FURNISHED TO THE GOVERNMENT, OTHER THAN THE ARRS-100, GRPS-75 TECHNICAL MANUALS, WILL BE USED FOR PURPOSES OF THIS PROCUREMENT. IT HAS ALSO TAKEN THE POSITION THAT THE SOLICITATION'S ENGINEERING WORK STATEMENT, WHICH MAKES NO DISCLOSURE OF ANY DATA FURNISHED BY YOUR COMPANY WITH A PROPRIETARY LEGEND, TOGETHER WITH THE RELATED EQUIPMENT WHICH IS TO BE FURNISHED BY THE GOVERNMENT, ARE CONSIDERED BY THE GOVERNMENT, AND BY AT LEAST ONE OTHER PROPOSER SELECTED ON THE BASIS OF ITS EXPERIENCE, AS ADEQUATE TO DESCRIBE THE CHARACTERISTICS OF THE TRAINING DISPLAY OR TO PERMIT THEIR DETERMINATION THROUGH ANALYSIS OF THE RELATED EQUIPMENT BY A SUFFICIENTLY EXPERIENCED CONCERN.

WITH REGARD TO THE ARRS-100, GRPS-75 TECHNICAL MANUALS, THE AIR FORCE CONTESTS THE PROPRIETARY MARKINGS PLACED THEREON BY YOUR FIRM SINCE THE GOVERNMENT ACQUIRED THE MANUALS UNDER ORDERS AGAINST BASIC ORDERING AGREEMENTS WHICH CONTAINED THE "RIGHTS IN TECHNICAL DATA" CLAUSE SET OUT IN ARMED SERVICES PROCUREMENT REGULATION (ASPR) 9-203 (B) GRANTING UNLIMITED RIGHTS TO THE GOVERNMENT IN BOTH TECHNICAL DATA AND MANUALS OR INSTRUCTIONAL MATERIALS. ALSO, THE AIR FORCE CONTENDS THAT A MAJOR PORTION, IF NOT ALL, OF THE DESIGN AND DEVELOPMENT COSTS SHOULD HAVE BEEN INCLUDED AND HAVE BEEN COMPENSATED FOR IN THE PHASE I AND PHASE II ENGINEERING CONTRACT FOR THE 14-CHANNEL RECORDER SYSTEM. ALTHOUGH THIS MATTER IS STILL UNDER DISCUSSION BETWEEN YOUR FIRM AND THE AIR FORCE, ON THE RECORD BEFORE US WE SEE NO BASIS FOR QUESTIONING THE GOVERNMENT'S CONTENTION THAT IT ACQUIRED UNLIMITED RIGHTS IN THE MANUALS PURSUANT TO THE EXPRESS CONTRACT PROVISION THEREFOR.

WITH RESPECT TO YOUR QUESTION CONCERNING THE FAIRCHILD-HILLER, REPUBLIC AVIATION DRAWING 105G805004, WHICH THE GOVERNMENT HAD INITIALLY PROPOSED TO FURNISH TO THE SUCCESSFUL CONTRACTOR FOR USE IN THIS PROCUREMENT, THE AIR FORCE ADVISES THAT THIS PROVISION HAS BEEN NEGOTIATED OUT OF THE SOLICITATION AS APPLICABLE TO ANY PROPOSER OTHER THAN APPLIED TECHNOLOGY, AND THAT THE OTHER PROPOSERS HAVE BEEN ADVISED THAT SUCH DRAWING WILL NOT BE FURNISHED TO THEM FOR PERFORMANCE OF THE CONTRACT.

WHILE YOU CONTEND THAT IN THIS PROCUREMENT THE GOVERNMENT WILL ACQUIRE RIGHTS IN DATA FOR YOUR RELATED EQUIPMENTS FROM ANOTHER FIRM, AND YOU CLAIM THIS IS DISCRIMINATORY BECAUSE OF YOUR INTEREST IN PROTECTING SUCH DATA, WE SEE NO BASIS FOR BARRING THE GOVERNMENT FROM COMPETITIVELY CONTRACTING TO OBTAIN SUCH DATA FROM ANY CONTRACTOR WHO IS ABLE TO PRODUCE IT.

YOU ALSO QUESTION THE PROPRIETY OF COMPETING THIS PROCUREMENT SINCE YOU BELIEVE THE GOVERNMENT FAILED TO PROVIDE ADEQUATE DATA TO OTHER OFFERORS. AS A GENERAL RULE, HOWEVER, THE APPLICABLE STATUTE IN NEGOTIATED PROCUREMENTS REQUIRES THAT PROPOSALS BE SOLICITED FROM THE MAXIMUM NUMBER OF QUALIFIED SOURCES CONSISTENT WITH THE NATURE AND REQUIREMENTS OF THE SUPPLIES OR SERVICES TO BE PROCURED. 10 U.S.C. 2304G. AS YOU POINT OUT, THIS OFFICE HAS ENTERTAINED AND SUSTAINED PROTESTS WHERE SPECIFICATIONS HAVE BEEN DETERMINED TO BE INADEQUATE, BUT WE NOTE THAT SUCH PROTESTS ARE CONSIDERED MERITORIOUS ONLY WHEN INITIATED BY A CONCERN WHOSE ABILITY TO SUBMIT A RESPONSIVE BID IS HINDERED BY THE SPECIFICATIONS, OR LACK THEREOF, AND FULL AND FREE COMPETITION IS THEREFORE DIMINISHED. IT IS TRUE THAT COMPETITION SHOULD NOT BE PERMITTED WHEN PERFORMANCE IS IMPOSSIBLE UNLESS THE GOVERNMENT RELEASES THE NECESSARY PROPRIETARY DATA SINCE, AS YOU POINT OUT, THE COURTS HAVE IMPOSED UPON THE GOVERNMENT IN SUCH CIRCUMSTANCES THE RISK OF IMPOSSIBILITY OF PERFORMANCE. IN THE PRESENT CASE, HOWEVER, A BIDDER IS FULLY AWARE THAT THE GOVERNMENT WILL NOT RELEASE DATA WHICH YOU CONTEND IS PROPRIETARY. NEVERTHELESS, BOTH THE BIDDER AND THE CONTRACTING AGENCY ARE CONVINCED OF THE FEASIBILITY OF PRODUCING THE DISPLAY WITHOUT IT. WE ALSO NOTE IN THIS REGARD THAT YOUR PROTEST REFERENCES SEVERAL SPECIFIC SECTIONS OF THE ENGINEERING WORK STATEMENT WHICH YOU CONTEND ARE IMPOSSIBLE OF PERFORMANCE WITHOUT THE GOVERNMENT'S RELEASE OF YOUR PROPRIETARY DATA. THE RECORD BEFORE US, HOWEVER, SHOWS THAT AIR FORCE TECHNICAL PERSONNEL ARE AWARE OF THESE ARGUMENTS, BUT THEY REMAIN CONVINCED THAT PERFORMANCE IS POSSIBLE WITHOUT USE OF ANY DATA IN WHICH YOU MAY HAVE PROPRIETARY RIGHTS. IN VIEW OF THE HIGHLY TECHNICAL CONSIDERATIONS ENTERING INTO THIS DECISION WE MUST ACCEPT THE POSITION OF THE AIR FORCE AS BEING CORRECT UNLESS THERE IS CONVINCING EVIDENCE TO THE CONTRARY. WE FIND NO SUCH EVIDENCE IN THE PRESENT RECORD.

ACCORDINGLY, YOUR REQUEST FOR CANCELLATION OF THE RFP AND SUBSTITUTION OF SOLE SOURCE NEGOTIATIONS WITH YOUR COMPANY MUST BE DENIED.