B-171957, DEC 7, 1971

B-171957: Dec 7, 1971

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LOW BID WAS REJECTED WHEN AN ALLEGED DISCREPANCY IN THE SPECIFICATIONS WAS DISCOVERED. A BRAND NAME OR EQUAL CLAUSE WAS INCLUDED BUT ITEMS DESCRIBED WERE NOT DESCRIBED BY BRAND NAME. ADC'S BID WAS NOT PROPERLY REJECTED. AS CORRECTIVE MEASURES HAVE BEEN TAKEN. NO FUTURE ACTION IS CONTEMPLATED. SECRETARY: REFERENCE IS MADE TO YOUR ADMINISTRATIVE REPORT DATED APRIL 6. THE SOLICITATION WAS ISSUED ON APRIL 30. FOUR BIDS WERE RECEIVED AND THE PRICES BID BY ADC WERE SO MUCH LOWER THAN THE GROUPING OF THE OTHER BIDS THAT IT RAISED THE POSSIBILITY OF A MISTAKE IN THE LOW BID. THE GOVERNMENT DISCOVERED THAT THE SPECIFICATIONS IN THE SOLICITATION WERE INCOMPLETE AND RESTRICTIVE. THAT THE SOLICITATION CONTAINED A "QUALITY ASSURANCE" REQUIREMENT WHICH WAS IN CONFLICT WITH THE "INSPECTION" PROVISIONS CONTAINED IN THE IFB.

B-171957, DEC 7, 1971

BID PROTEST - REJECTION AND READVERTISEMENT DECISION CONCERNING PROTEST OF AMERICAN DATA CORPORATION (ADC) AGAINST REJECTION OF ITS LOW BID AND THE READVERTISEMENT OF A SOLICITATION FOR THE PURCHASE OF VARIOUS GENERATORS. LOW BID WAS REJECTED WHEN AN ALLEGED DISCREPANCY IN THE SPECIFICATIONS WAS DISCOVERED. UPON RESOLICITATION, A BRAND NAME OR EQUAL CLAUSE WAS INCLUDED BUT ITEMS DESCRIBED WERE NOT DESCRIBED BY BRAND NAME. FOR THIS REASON, ADC'S BID WAS NOT PROPERLY REJECTED. AS CORRECTIVE MEASURES HAVE BEEN TAKEN, NO FUTURE ACTION IS CONTEMPLATED.

TO MR. SECRETARY:

REFERENCE IS MADE TO YOUR ADMINISTRATIVE REPORT DATED APRIL 6, 1971, IN RESPONSE TO THE PROTEST OF AMERICAN DATA CORPORATION OF HUNTSVILLE, ALABAMA (ADC), UNDER INVITATION FOR BIDS NO. DAAC08-70-B-0022, ISSUED BY THE PROCUREMENT DIVISION OF THE SACRAMENTO ARMY DEPOT. THE SOLICITATION WAS ISSUED ON APRIL 30, 1970, FOR THE PURCHASE OF VARIOUS GENERATORS WITH ACCESSORIES UNDER A "REQUIREMENTS" TYPE CONTRACT.

FOUR BIDS WERE RECEIVED AND THE PRICES BID BY ADC WERE SO MUCH LOWER THAN THE GROUPING OF THE OTHER BIDS THAT IT RAISED THE POSSIBILITY OF A MISTAKE IN THE LOW BID.

ON AUGUST 11, 1970, THE CONTRACTING OFFICER CALLED MR. SWAN, MANAGER OF THE VIDEO PRODUCTS DIVISION OF ADC, TO ADVISE OF A POSSIBLE MISTAKE AND TO REQUEST VERIFICATION OF THE BID. A LETTER DATED AUGUST 12, 1970, TO ADC, CONFIRMED THAT TELEPHONE CONVERSATION. THE PROCURING ACTIVITY RECEIVED A LETTER DATED AUGUST 13, 1970, SIGNED BY MR. SWAN WHICH VERIFIED THE BID PRICE. SHORTLY THEREAFTER, AND BEFORE AWARD COULD BE MADE, THE GOVERNMENT DISCOVERED THAT THE SPECIFICATIONS IN THE SOLICITATION WERE INCOMPLETE AND RESTRICTIVE, AND THAT THE SOLICITATION CONTAINED A "QUALITY ASSURANCE" REQUIREMENT WHICH WAS IN CONFLICT WITH THE "INSPECTION" PROVISIONS CONTAINED IN THE IFB. CONSEQUENTLY, THE IFB WAS CANCELLED ON SEPTEMBER 11, 1970, WITH THE INTENTION OF READVERTISING AFTER THE SPECIFICATIONS HAD BEEN MADE MORE DEFINITIVE AND CONSISTENT. ALL BIDDERS WERE NOTIFIED OF THE CANCELLATION BY LETTER DATED SEPTEMBER 11, 1970.

THE REASONS SET FORTH BY THE ARMY FOR THE CHANGE IN SPECIFICATIONS WERE AS FOLLOWS:

"THE CHANGES MADE IN SPECIFICATIONS FOR THE SECOND SOLICITATION FOR A SYNC GENERATOR REQUIREMENTS CONTRACT WERE MADE TO RELAX THE REQUIREMENTS AND TO ILLUMINATE CERTAIN AREAS WHICH MAY HAVE APPEARED TO HAVE BEEN OBSCURE IN THE ORIGINAL SPECIFICATIONS. THIS WAS DONE IN HOPES OF RECEIVING MORE RESPONSIVE BIDS FROM MANUFACTURERS AND TO PERMIT BIDS FROM MANUFACTURERS WHO COULD NOT MEET SOME OF THE ORIGINAL SPECIFICATIONS FOR ONE REASON OR ANOTHER.

"THE FIRST CHANGE WAS MADE IN SECTION 3.1.1. IT WAS DETERMINED THAT THE WORDING OF THE ORIGINAL SPECIFICATION COULD BE MISREAD AND THAT SOME VENDORS MIGHT NOT HAVE BID. THE ORIGINAL SPEC WAS REWRITTEN TO CLEARLY STATE THAT VENDORS OFFERING SYNC GENERATORS WHICH DID NOT PROVIDE A MEANS OF VARYING THE PULSE WIDTHS WOULD BE ACCEPTABLE, PROVIDED CERTAIN CONDITIONS AS DESCRIBED WERE MET BY THE EQUIPMENT BEING OFFERED. THIS RELAXATION WOULD ALLOW VENDORS WHO MIGHT OFFER DIGITAL TYPE SYNC GENERATORS TO BE RESPONSIVE.

"THE SECOND AND THIRD CHANGES WERE MADE IN SECTIONS 3.1.2.3.1 AND 3.1.2.3.2 WHEREIN THESE ORIGINAL SECTIONS SPECIFIED EXACT CRYSTAL FREQUENCIES FOR THE TWO TYPES OF GENERATORS. THESE TWO SECTIONS WERE DELETED AND MARKED 'RESERVED.' IT WAS DETERMINED THAT SHOULD SOME MANUFACTURERS USE OTHER BASIC FREQUENCIES AND STILL PROVIDE ALL THE PULSE INFORMATION REQUIRED, THAT SUCH MANUFACTURERS SHOULD NOT BE DISQUALIFIED. THIS RELAXATION OF SPECIFICATIONS AGAIN MADE IT POSSIBLE FOR MORE RESPONSIVE BIDDERS TO MEET THE SPECIFICATIONS.

"THE NEXT CHANGE IN THE SPECIFICATION WAS MADE IN SECTION 3.4. THIS INVOLVED THE ADDITION OF THE WORDS 'AND POWER SUPPLYS).' AS ORIGINALLY WRITTEN, SOME VENDORS MAY HAVE THOUGHT THAT THE POWER SUPPLIES WERE NOT REQUIRED, AND MAY NOT HAVE INCLUDED THEM IN THEIR BID, SINCE THEY WERE NOT DESCRIBED. THIS CONSTITUTED A SUBSTANTIAL CORRECTION BY REQUIRING SOMETHING THAT MAY POSSIBLY HAVE BEEN CONSIDERED BY SOME BIDDERS TO HAVE BEEN 'NOT REQUIRED.' THE SPEC COULD HAVE BEEN CONSIDERED INCOMPLETE, AND SINCE IT WAS AN IFB NOTHING COULD BE DONE TO ADVISE BIDDERS.

"THE REMAINING CHANGES ON THE REVISED SPECIFICATION WERE MADE TO DELETE SECTION 4, SECTION 5.1, AND SECTION 6. SECTION 4 WAS DELETED TO RELAX THE SPEC SO THAT VENDORS WOULD NOT BE BURDENED WITH THE INAPPLICABLE 'RESPONSIBILITY FOR INSPECTION' CLAUSE CONTAINED THEREIN. SECTION 5.1 WAS DELETED BECAUSE THESE REQUIREMENTS WERE SUFFICIENTLY DESCRIBED ELSEWHERE IN THE SOLICITATION AND ITS DELETION MAKES FOR A CLEANER SPEC. SECTION 6 WAS DELETED BECAUSE THE INFORMATION THEREIN WAS STRICTLY 'IN-HOUSE' NOTES TO THE CONTRACTING OFFICER (BUYER) TO BETTER ACQUAINT HIM WITH THE ITEMS BEING PROCURED."

ON OCTOBER 21, 1970, A RESOLICITATION WAS ISSUED WITH THE NEW AND RELAXED SPECIFICATIONS. THE IFB INCLUDED THE FOLLOWING PROVISION:

"BRAND NAME OR EQUAL ***

"A. IF ITEMS CALLED FOR BY THIS INVITATION FOR BIDS HAVE BEEN IDENTIFIED IN THE SCHEDULE BY A 'BRAND NAME OR EQUAL' DESCRIPTION, SUCH IDENTIFICATION IS INTENDED TO BE DESCRIPTIVE, BUT NOT RESTRICTIVE, AND IS TO INDICATE THE QUALITY AND CHARACTERISTICS OF PRODUCTS THAT WILL BE SATISFACTORY. ***

"(2) IF THE BIDDER PROPOSES TO MODIFY A PRODUCT SO AS TO MAKE IT CONFORM TO THE REQUIREMENTS OF THE INVITATION FOR BIDS, HE SHALL (I) INCLUDE IN HIS BID A CLEAR DESCRIPTION OF SUCH PROPOSED MODIFICATIONS AND (II) CLEARLY MARK ANY DESCRIPTIVE MATERIAL TO SHOW THE PROPOSED MODIFICATIONS.

"(3) MODIFICATIONS PROPOSED AFTER BID OPENING TO MAKE A PRODUCT CONFORM TO A BRAND NAME PRODUCT REFERENCED IN THE INVITATION FOR BIDS WILL NOT BE CONSIDERED."

FIVE BIDS WERE RECEIVED AND OPENED ON NOVEMBER 30, 1970. THE ADC BID WAS DETERMINED TO BE NONRESPONSIVE BECAUSE IT INDICATED PURSUANT TO THE CLAUSE QUOTED ABOVE, THAT ITS EQUIPMENT WOULD HAVE TO BE MODIFIED TO COMPLY WITH THE SPECIFICATIONS BUT FAILED TO DESCRIBE THE MODIFICATIONS AS REQUIRED BY THE TERMS OF THE CLAUSE.

NOTWITHSTANDING THE INCLUSION OF THE BRAND-NAME OR EQUAL CLAUSE, THE ITEMS CALLED FOR WERE NOT DESCRIBED BY BRAND NAME. THEREFORE, THE CLAUSE HAS NO APPLICATION AND WE DO NOT BELIEVE THAT IT WAS PROPERLY INVOKED. FOR THAT REASON, ALSO, WE DO NOT BELIEVE THAT ADC'S BID WAS PROPERLY REJECTED.

IDENTICAL AWARDS FOR ALL ITEMS WERE MADE TO BOTH GRASS VALLEY AND RCA. WITH REGARD TO THESE MULTIPLE AWARDS, THE CONTRACT HAD SUBSECTION (E) OF PARAGRAPH (B)(6) ENTITLED "DELIVERY ORDER LIMITATIONS" OF MODIFICATION NO. 2 WHICH STATES IN PART AS FOLLOWS:

"WHEN MULTIPLE AWARDS ARE MADE THE GOVERNMENT SHALL ORDER ALL THE SUPPLIES OR SERVICES SET FORTH IN THE SCHEDULE WHICH ARE REQUIRED TO BE PURCHASED BY THE GOVERNMENT ACTIVITY IDENTIFIED IN THE 'ORDERING' CLAUSE FROM ANY ONE OF THE CONTRACTORS UNDER THIS SOLICITATION SUBJECT TO ALL JUSTIFICATIONS INCLUDING PRICE."

WE WERE INFORMED BY THE ARMY MATERIEL COMMAND THAT ANY BIDDER SUBMITTING A RESPONSIVE BID WOULD HAVE RECEIVED AN AWARD UNDER THIS SOLICITATION.

THIS OFFICE IN THE PAST HAS QUESTIONED WHETHER THE MULTIPLE AWARD METHOD OF PROCUREMENT IS DESIRABLE OR EVEN REPRESENTS A PROPER METHOD OF PROCUREMENT UNDER THE ADVERTISING STATUTE. SEE B-121926 AND B 126682, FEBRUARY 7, 1956, COPIES ENCLOSED. WE FIND NO AUTHORITY IN THE APPLICABLE STATUTE OR REGULATION FOR THE USE OF MULTIPLE AWARDS IN THIS TYPE OF SITUATION. HOWEVER, SINCE INFORMAL ADVICE FROM THE ARMY MATERIEL COMMAND INDICATES THAT ITS USE HAS BEEN DISCONTINUED, FURTHER CONSIDERATION WOULD SERVE NO USEFUL PURPOSE.

ALSO, IN VIEW OF THE IMPENDING EXPIRATION DATE OF THE CURRENT SCHEDULE, WE DO NOT BELIEVE IT WOULD BE PRACTICAL TO TAKE ANY ACTION WITH RESPECT TO THE ADC BID.