B-170077(1), SEP. 23, 1970

B-170077(1): Sep 23, 1970

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DETERMINATION TO CANCEL SOLICITATIONS PERMITTING SEVERAL SUPPLIERS FROM FURNISHING COMPONENTS ON THE BASIS THAT COMPATIBILITY OF COMPONENTS WAS REQUIRED IS A MATTER WITHIN THE TECHNICAL JUDGMENT OF THE PROCURING ACTIVITY AND THEREFORE "ALL OR NONE" BIDDING LIMITATION IS NOT SUBJECT TO OBJECTION. INC.: REFERENCE IS MADE TO YOUR LETTER DATED JUNE 16. THESE SOLICITATIONS WERE CANCELED FOR SEVERAL REASONS. WE HAVE BEEN ADVISED THAT AWARD UNDER SOLICITATION -0258 IS BEING WITHHELD PENDING A DECISION BY OUR OFFICE. THE BASIS FOR YOUR REQUEST THAT SOLICITATION -0258 BE CANCELED CONCERNS "THE MANNER IN WHICH THE THREE ITEMS REQUIRED ARE PACKAGED TOGETHER. SO THAT A MANUFACTURER OF ONLY ONE OR TWO OF THE THREE ITEMS IS EXCLUDED FROM SUBMITTING AN INDIVIDUAL BID.".

B-170077(1), SEP. 23, 1970

BID PROTEST - SPECIFICATIONS - "ALL OR NONE" DENIAL OF PROTEST OF DUMONT OSCILLOSCOPE LABORATORIES, INC., AGAINST CANCELLATION OF TWO PRIOR FORMALLY ADVERTISED SOLICITATION FOR DIGITAL LOGIC TRAINING SYSTEMS AND RESOLICITATION ON A BASIS PRECLUDING SEVERAL SUPPLIERS FROM FURNISHING INDIVIDUAL ITEMS AND AWARD TO ONE MANUFACTURER, BY THE NAVAL ADMINISTRATIVE COMMAND, SUPPLY DEPARTMENT, GREAT LAKES, ILL. DETERMINATION TO CANCEL SOLICITATIONS PERMITTING SEVERAL SUPPLIERS FROM FURNISHING COMPONENTS ON THE BASIS THAT COMPATIBILITY OF COMPONENTS WAS REQUIRED IS A MATTER WITHIN THE TECHNICAL JUDGMENT OF THE PROCURING ACTIVITY AND THEREFORE "ALL OR NONE" BIDDING LIMITATION IS NOT SUBJECT TO OBJECTION.

TO DUMONT OSCILLOSCOPE LABORATORIES, INC.:

REFERENCE IS MADE TO YOUR LETTER DATED JUNE 16, 1970, WITH ENCLOSURE, REQUESTING CANCELLATION OF FORMALLY ADVERTISED SOLICITATION NO. N00128 70- B-0258, ISSUED SUBSEQUENT TO THE CANCELLATIONS OF FORMALLY ADVERTISED SOLICITATIONS NOS. N00128-70-B-0137 AND N00128-70-B-0178, BY THE NAVAL ADMINISTRATIVE COMMAND, SUPPLY DEPARTMENT, GREAT LAKES, ILLINOIS.

ALL OF THE CITED SOLICITATIONS INVITED BIDS FOR VARYING QUANTITIES OF DIGITAL LOGIC TRAINING SYSTEMS CONSISTING OF THREE BASIC COMPONENTS PER SYSTEM: DIGITAL LOGIC TRAINER, READOUT DEVICE, AND DUAL TRACE 60 MHZ OSCILLOSCOPE. SOLICITATION -0137, ISSUED ON DECEMBER 17, 1969, AND SOLICITATION -0178, ISSUED ON FEBRUARY 6, 1970, PERMITTED BIDS TO BE SUBMITTED ON AN AGGREGATE BASIS FOR FURNISHING THE COMPLETE TRAINING SYSTEM OR ON AN INDIVIDUAL COMPONENT BASIS. SUBSEQUENTLY, THESE SOLICITATIONS WERE CANCELED FOR SEVERAL REASONS, INCLUDING AMBIGUOUS SPECIFICATIONS, QUANTITY CHANGES, AND DELIVERY SCHEDULE CHANGES.

THE CHALLENGED SOLICITATION -0258, ISSUED ON JUNE 3, 1970, SET FORTH THE TRAINING SYSTEM REQUIREMENT TO BE PROCURED AS FOLLOWS:

"DIGITAL LOGIC TRAINING SYSTEM COMPLETE, CONSISTING OF THREE FUNDAMENTAL UNITS:

DIGITAL LOGIC TRAINER (POSITIVE LOGIC)

READOUT DEVICE

DUAL TRACE 60 MHZ OSCILLOSCOPE IN ACCORDANCE WITH SPECIFICATIONS CONTAINED IN SECTION 2.0 ENTITLED 'DESCRIPTION OR SPECIFICATIONS', PARAGRAPH 2.1" THIS SOLICITATION DELETED THE ABOVE STATED OPTION IN THE TWO PRIOR SOLICITATIONS BY REQUIRING BIDS ON THE COMPLETE TRAINING SYSTEM IN ACCORDANCE WITH APPLICABLE SPECIFICATIONS. WE HAVE BEEN ADVISED THAT AWARD UNDER SOLICITATION -0258 IS BEING WITHHELD PENDING A DECISION BY OUR OFFICE.

THE BASIS FOR YOUR REQUEST THAT SOLICITATION -0258 BE CANCELED CONCERNS "THE MANNER IN WHICH THE THREE ITEMS REQUIRED ARE PACKAGED TOGETHER, SO THAT A MANUFACTURER OF ONLY ONE OR TWO OF THE THREE ITEMS IS EXCLUDED FROM SUBMITTING AN INDIVIDUAL BID." IN ADDITION, YOU STATE THAT:

" *** THE FORMAT OF THIS SOLICITATION WOULD REQUIRE US TO SUBMIT A JOINT BID, OR SUB-BID, WITH ONE OR TWO OTHER PARTIES FOR THE COMPLETE PACKAGE, SO THAT THE IDENTITY AND COMPETITIVENESS OF OUR OFFER WOULD BE LOST. ***

"FROM THE GOVERNMENT'S POINT OF VIEW, IF WE WERE TO SUBBID OUR OSCILLOSCOPES TO A THIRD PARTY, THE LATTER MIGHT MARK-UP OUR PRICES, THUS MAKING THE PACKAGE MORE EXPENSIVE THAN IN THE CASE OF DIRECT INDIVIDUAL BIDS."

WE ARE ADVISED THAT AFTER APPROXIMATELY 1 YEAR OF DEVELOPING SPECIFICATIONS FOR THE TRAINING SYSTEM IT WAS DETERMINED BY THE PROCUREMENT ACTIVITY THAT:

" *** DELIVERY OF A COMPLETE 'TRAINING SYSTEM' BY A SINGLE SUPPLIER, AND NOT DELIVERY OF INDIVIDUAL COMPONENTS OF THAT SYSTEM BY SEVERAL SEPARATE SUPPLIERS, WAS ABSOLUTELY NECESSARY TO ACCOMPLISH THE INTENDED TRAINING PURPOSE THEREBY NECESSITATING CANCELLATION OF THE SOLICITATION. *** "

THIS DESIRED SOLICITATION REQUIREMENT FOR COMPATIBILITY OF THE INDIVIDUAL COMPONENTS OF THE TRAINING SYSTEM TO ASSURE PROPER SYSTEM FUNCTIONING WAS ONE OF THE PRINCIPAL BASES FOR CANCELLATION OF SOLICITATION -0178. THIS REGARD, THE PROCUREMENT ACTIVITY ADVISES:

"THE CHANGE IN SPECIFICATIONS REQUIRING BIDS ON A COMPLETE TRAINING SYSTEM RATHER THAN ON COMPONENTS OF SUCH SYSTEM WAS SUBSTANTIAL IN NATURE AND A PROPER BASIS FOR CANCELLATION OF THE SECOND SOLICITATION. IT WAS TECHNICALLY DETERMINED THAT THERE COULD BE NO ASSURANCE TO THE GOVERNMENT THAT INDIVIDUAL COMPONENTS, IF PURCHASED SEPARATELY FROM DIFFERENT SUPPLIERS, WOULD BE COMPATIBLE WITH EACH OTHER AND FUNCTION PROPERLY AS AN INTEGRATED UNIT. ADDITIONALLY, RESPONSIBILITY FOR PERFORMANCE OF THE ENTIRE SYSTEM HAD TO BE PLACED ON A SINGLE SUPPLIER IN ORDER TO ELIMINATE THE NEED OF ATTEMPTING TO DETERMINE WHICH PARTICULAR COMPONENT MIGHT BE THE POSSIBLE CAUSE OF SYSTEM MALFUNCTION SO THAT RESPONSIBILITY COULD BE PLACED ON THE SUPPLIER OF THAT COMPONENT. THE ALMOST INSURMOUNTABLE DIFFICULTIES TO THE SUCCESSFUL PLACING OF DEFECT RESPONSIBILITY BY THE GOVERNMENT ARE OBVIOUS IF MORE THAN ONE SUPPLIER WERE INVOLVED. FURTHER, THE COST OF MATCHING INDIVIDUAL COMPONENTS TO EACH OTHER AND THE 'HOOK UP' OF SUCH COMPONENTS INTO A WORKING 'SYSTEM' WERE MADE THE RESPONSIBILITY OF THE CONTRACTOR AND NOT OF THE GOVERNMENT. THESE FACTS CLEARLY ANSWER DUMONT'S REQUEST THAT THE FORMAT OF THE SOLICITATION BE CHANGED TO ALLOW INDIVIDUAL COMPONENT BIDS IN LIEU OF REQUIRING A COMPLETE SYSTEM BID.

"IT IS AN ACCEPTED, AND SOMETIMES ENCOURAGED, PRACTICE TO SUBCONTRACT A PORTION OF THE MANUFACTURING OR FABRICATION PERFORMANCE ELEMENTS REQUIRED BY A GOVERNMENT CONTRACT. IT COULD BE SAID, THAT THE RULE RATHER THAN THE EXCEPTION IS FOR A SUPPLIER TO SUBCONTRACT A PORTION OF THE PERFORMANCE REQUIRED BY A GOVERNMENT CONTRACT RATHER THAN TO ATTEMPT COMPLETE PERFORMANCE BY HIMSELF. TO ACCEDE TO DUMONT'S REQUEST WOULD BE TO ALLOW A CONTRACTOR TO DICTATE THE GOVERNMENT'S MATERIAL REQUIREMENTS."

IN 47 COMP. GEN. 701 (1968), AT PAGES 703 AND 704, WE HAD OCCASION TO RULE ON A PROTEST INVOLVING A FORMALLY ADVERTISED SOLICITATION WHICH CONTAINED, AS HERE, AN AGGREGATE BIDDING LIMITATION WITH RESPECT TO SEVERAL INDIVIDUAL ITEMS, BECAUSE SUCH A LIMITATION WAS NECESSARY TO INSURE A PURCHASE BY THE GOVERNMENT OF A WORKABLE SYSTEM. WE HELD AS FOLLOWS:

"WE HAVE HELD THAT THE FORMAL ADVERTISING STATUTE REQUIRES THAT EVERY EFFORT BE MADE TO DRAFT INVITATIONS FOR BIDS IN SUCH TERMS AS WILL PERMIT THE BROADEST FIELD OF COMPETITION CONSISTENT WITH THE GOVERNMENT'S ACTUAL NEEDS. AS TO THE PRESENT PROCUREMENT, WE FIND NO ADEQUATE BASIS FOR HOLDING THAT THE USE OF THE 'ALL OR NONE' BIDDING LIMITATION IS NOT BASED UPON A BONA FIDE DETERMINATION BY THE PROCURING ACTIVITY THAT THE NECESSARY DEGREE OF COMPATIBILITY OF COMPONENTS OF THE ADVERTISED SYSTEMS CANNOT BE OTHERWISE ACHIEVED UNDER THE REFERENCED MILITARY SPECIFICATIONS. IN B-151738, AUGUST 19, 1963, WHEREIN WE CONSIDERED A PROTEST AGAINST AN INVITATION REQUIREMENT FOR AGGREGATE BIDDING IN THE PROCUREMENT OF OSCILLOSCOPES AND CAMERAS, WE HELD:

"'IT IS WELL ESTABLISHED THAT THE DRAFTING OF SPECIFICATIONS DESIGNED TO MEET THE MINIMUM NEEDS OF THE GOVERNMENT AND THE DETERMINATION AS TO WHETHER THE BIDS RECEIVED ARE RESPONSIVE TO SUCH SPECIFICATIONS ARE MATTERS WHICH ARE PRIMARILY THE RESPONSIBILITY OF THE ADMINISTRATIVE OFFICE REQUIRING THE MATERIALS OR EQUIPMENT. 21 COMP. GEN. 1132, 1136; B- 134846, JUNE 12, 1958. WHEN A SPECIFICATION LENDS ITSELF TO OPEN COMPETITION AS REQUIRED BY APPLICABLE STATUTES AND IT IS SHOWN, WHEN CONSIDERING ALL OF THE FACTS, THAT ANY RESTRICTIVE PROVISIONS THEREIN ARE NO GREATER THAN NECESSARY TO PROTECT LEGITIMATE INTERESTS OF THE GOVERNMENT, OUR OFFICE WILL NOT INTERVENE.

"'IN VIEW OF THE UNSATISFACTORY PAST EXPERIENCE BY THE FEDERAL AVIATION AGENCY WITH OSCILLOSCOPES AND CAMERAS MADE BY MISCELLANEOUS MANUFACTURERS, AND IN VIEW OF THE TECHNICAL REQUIREMENTS OF THIS PROCUREMENT, WE DO NOT FEEL THAT WE WOULD BE JUSTIFIED IN OBJECTING IN THIS INSTANCE TO THE AGENCY'S DETERMINATION THAT ITS INTERESTS REQUIRED THE PROCUREMENT OF BOTH THE OSCILLOSCOPES AND THE CAMERAS FROM A SINGLE SOURCE. ACCORDINGLY, WE FIND THAT THE REQUIREMENT FOR AGGREGATE BIDS IN THE INVITATION WAS NOT IN CONTRAVENTION OF THE STATUTES REQUIRING OPEN AND COMPETITIVE BIDDING.'

"CLEARLY, IN THE ORDERLY CONDUCT OF THE GOVERNMENT'S BUSINESS, THE GOVERNMENT AS A BUYER MAY NOT BE PLACED IN THE POSITION OF HAVING TO PURCHASE A PORTION OF AN ADVERTISED SYSTEM FROM A POTENTIAL SUPPLIER WHO IS UNABLE OR UNWILLING TO SUPPLY THE ENTIRE SYSTEM BUT ONLY CERTAIN COMPONENTS OF THE SYSTEM. MOREOVER, THE TECHNICAL AND/OR ENGINEERING QUESTION AS TO WHETHER THE DESIRED COMPATIBILITY OF COMPONENTS MAY BE ATTAINED OTHER THAN THROUGH THE PURCHASE OF A COMPLETE RUBBISH COLLECTION SYSTEM IS NOT FOR RESOLUTION BY OUR OFFICE. RATHER, IN ACCORDANCE WITH OUR ESTABLISHED RULE IN AREAS SUCH AS HERE INVOLVED, WE MUST RELY UPON THE TECHNICAL JUDGMENT OF THE PROCUREMENT ACTIVITY.

"IN VIEW OF THE FACTS REPORTED, WE MUST CONCLUDE THAT THE 'ALL OR NONE' BIDDING LIMITATION IS NOT OBJECTIONABLE UNDER THE CIRCUMSTANCES OF THIS PROCUREMENT."

WHAT WE STATED IN THAT DECISION IS EQUALLY APPLICABLE TO YOUR PROTEST. SEE B-168348, JANUARY 14, 1970, AND CASES CITED THEREIN. ACCORDINGLY, YOUR PROTEST IS DENIED. THERE IS ENCLOSED FOR YOUR INFORMATION A COPY OF OUR LETTER OF TODAY TO DIGIAC CORPORATION DENYING ITS PROTEST UNDER THESE SOLICITATIONS.