B-181543, MAR 28, 1975

B-181543, MAR 28, 1975

1. PROTEST WAS NOT UNTIMELY, NOTWITHSTANDING AGENCY ALLEGATION THAT PROTESTER KNEW OF BASIS OF PROTEST FROM TELEPHONE CONVERSATION WITH AGENCY REPRESENTATIVE MORE THAN 5 DAYS PRIOR TO FILING OF PROTEST, SINCE RECORD INDICATES THERE EXISTS REASONABLE POSSIBILITY THERE WAS MISUNDERSTANDING AS TO SUBSTANCE OF CONVERSATION. MOREOVER, PROTEST WAS NOT UNTIMELY SINCE PROTEST WAS MADE INITIALLY TO AGENCY WITHIN 5 DAYS AFTER NOTICE OF BASIS FOR PROTEST APPEARED IN COMMERCE BUSINESS DAILY AND PROTEST THEN WAS FILED WITH GAO PRIOR TO ADVERSE AGENCY ACTION THEREON. 2. PROTEST AGAINST SOLE-SOURCE AWARD PURSUANT TO SUBMISSION OF UNSOLICITED PROPOSAL FOR SUPPORT SERVICES REQUIRED BY NAVY TO DEFEND DELAY CLAIM PENDING BEFORE ARMED SERVICES BOARD OF CONTRACT APPEALS IS DENIED, SINCE RECORD REASONABLY JUSTIFIED DETERMINATION TO MAKE SOLE SOURCE AWARD TO FIRM WITH INTIMATE KNOWLEDGE OF AND LONG INVOLVEMENT IN PROGRAM UNDER WHICH CLAIM AROSE AND BECAUSE OF IMPOSSIBILITY OF DRAFTING ADEQUATE SPECIFICATIONS FOR COMPETITIVE PROCUREMENT. MOREOVER, FACT THAT OFFEROR WAS INVOLVED IN PROGRAM UNDER WHICH CLAIM AROSE DID NOT CONSTITUTE UNFAIR COMPETITIVE ADVANTAGE OR PREJUDICE RIGHTS OF OTHER PROSPECTIVE OFFERORS.

H.J. HANSEN COMPANY:

THIS PROTEST CONCERNS THE SOLE-SOURCE AWARD PURSUANT TO AN UNSOLICITED PROPOSAL TO PEAT, MARWICK, MITCHELL AND COMPANY (PMM) FOR SERVICES TO SUPPORT THE NAVY CLAIMS TEAM IN CONNECTION WITH ITS EFFORT TO LITIGATE OR SETTLE A DELAY CLAIM, RELATIVE TO THE MK 48 TORPEDO PROGRAM, FILED AGAINST IT IN THE ARMED SERVICES BOARD OF CONTRACT APPEALS (ASBCA) BY WESTINGHOUSE ELECTRIC COMPANY.

IN FEBRUARY 1974, H.J. HANSEN COMPANY, MANAGEMENT CONSULTANTS, (HANSEN) REPRESENTED BY MR. H.J. HANSEN, DISCUSSED WITH PERSONNEL FROM THE NAVY CLAIMS TEAM THE POSSIBILITY OF HANSEN PERFORMING CERTAIN SUPPORT SERVICES REQUIRED BY THE NAVY IN DEFENSE OF THE WESTINGHOUSE CLAIM. ON JUNE 7, 1974, A NOTICE APPEARED IN THE COMMERCE BUSINESS DAILY (CBD) AS FOLLOWS:

"PREPARATION OF TECHNICAL REPORTS IN SUPPORT OF THE MK 48 MOD. O TORPEDO PROGRAM. THE NAVAL ORDINANCE SYSTEMS COMMAND INTENDS TO NEGOTIATE WITH PEAT, MARWICK, MITCHELL & CO., 1025 CONNECTICUT AVENUE, N.W., WASHINGTON, D.C. 20036 TO FORMALIZE AN UNSOLICITED PROPOSAL. SEE NOTE 46 P.R. A4-0007 -093 NAVORD SYNOPSIS NO. 385-74."

HANSEN PROTESTS THAT THE NOTATION IN THE CBD WAS IN ERROR IN THAT THE PMM PROPOSAL WAS NOT UNSOLICITED. THE PROTESTER ARGUES THAT A PRIOR SOLE- SOURCE AWARD TO PMM UNDER A MODIFICATION TO AN EXISTING CONTRACT FOR AUDIT AND OTHER SERVICES PLACED PMM IN THE COMPETITIVELY ADVANTAGEOUS POSITION OF BEING ABLE TO OUTLINE A PLAN FOR PREPARING A DEFENSE TO THE WESTINGHOUSE CLAIM AND, CONCURRENTLY, PREPARE AT GOVERNMENT EXPENSE WHAT SUBSEQUENTLY BECAME A SECOND "UNSOLICITED" PROPOSAL OFFERING TO PERFORM UNDER THAT PLAN. HANSEN REASONS THAT SINCE PMM DEVELOPED THE ORIGINAL PLAN, ITS SECOND "UNSOLICITED" PROPOSAL WAS ACTUALLY SOLICITED AND HANSEN AND OTHER INTERESTED FIRMS SHOULD HAVE BEEN PERMITTED THE OPPORTUNITY TO COMPETE. IN VIEW OF THE FACT THAT AWARD HAS NOW BEEN MADE AND PERFORMANCE COMPLETED, HANSEN SEEKS DAMAGES FOR ITSELF AND ALL OTHER QUALIFIED PROSPECTIVE CONTRACTORS FOR THE ALLEGED DENIAL OF THEIR COLLECTIVE RIGHT TO COMPETE FOR AWARD.

AS BACKGROUND, IN OCTOBER 1972, WESTINGHOUSE FILED A DELAY CLAIM WITH THE ARMED SERVICES BOARD OF CONTRACT APPEALS (ASBCA). SINCE NOVEMBER 9, 1972, UNDER CONTRACT NO. N00017-73-C-1205, PMM HAD BEEN PERFORMING FISCAL AND MANAGEMENT AUDIT SERVICES FOR THE NAVY RELATIVE TO THE MK 48 PROGRAM. MARCH 4, 1974, PMM SUBMITTED AN UNSOLICITED PROPOSAL FOR THE PERFORMANCE OF A PRELIMINARY STUDY OR PLAN TO ASSIST THE NAVY CLAIMS TEAM IN DEFENDING AGAINST THE WESTINGHOUSE CLAIM. THE PROPOSED STUDY REQUIRED, IN PART, THAT PMM IDENTIFY THE LOCATION OF DOCUMENTS PERTINENT TO THE NAVY'S DEFENSE AGAINST THE CLAIM AND PROVIDE A PLAN FOR DEVELOPMENT OF A CHRONOLOGICAL ACCOUNT OF EVENTS RELATING TO WESTINGHOUSE'S PERFORMANCE UNDER THE MK 48 PROGRAM. AT THE TIME OF THE SUBMISSION OF THIS PROPOSAL, THE NAVY WAS ATTEMPTING TO SATISFY A DISCOVERY REQUEST IN CONNECTION WITH THE WESTINGHOUSE CLAIM BEFORE THE ASBCA IN A TIMELY FASHION. MOREOVER, THE PRESSURE OF THE UPCOMING TRIAL TOGETHER WITH THE MUTUAL DESIRE OF BOTH WESTINGHOUSE AND THE NAVY TO SETTLE THE DISPUTE, HAD PLACED THE NAVY IN THE POSITION OF REQUIRING IMMEDIATE CONSULTING SERVICES IN ORDER FOR IT TO PRESENT A STRONG POSITION BEFORE THE ASBCA AND AT THE CONFERENCE TABLE. THE NAVY DETERMINED THAT DUE TO PMM'S PRIOR EXPERIENCE IN ASSISTING THE GOVERNMENT TO MONITOR WESTINGHOUSE'S PERFORMANCE, PMM WAS THE ONLY COMPANY CAPABLE OF PROVIDING SUCH INFORMATION IN A TIMELY MANNER. THEREFORE, PMM RECEIVED A SOLE-SOURCE AWARD ON APRIL 17, 1974, UNDER MODIFICATION P0002 (MOD. 2) TO CONTRACT N00017-73-C-1205.

HOWEVER, ON APRIL 15, 1974, TWO DAYS PRIOR TO THE EXECUTION OF MOD. 2, PMM HAD ALREADY SUBMITTED THE REQUIRED CHRONOLOGICAL ACCOUNT AND DOCUMENT REPORT TO THE NAVY. IN THE ACCOMPANYING COVER LETTER TO ITS REPORT, PMM INDICATED THAT: "PMM CO. IS READY NOW TO BEGIN THE WORK DESCRIBED IN ATTACHMENT 1 *** (PLAN FOR PREPARING CHRONOLOGICAL ACCOUNTS AND EVALUATION FOR COUNT XIII: DELAY DESCRIPTION, AND ACCELERATION) ***, SHOULD THE NAVY SO DESIRE." ON APRIL 19, 1974, THE NAVY PREPARED PROCUREMENT REQUEST (PR) NO. A4-OTCT-093 BASED IN LARGE MEASURE ON THE PMM PLAN SUBMITTED UNDER MOD. 2. THREE DAYS LATER, ON APRIL 22, PMM SUBMITTED AN UNSOLICITED PROPOSAL "FOR CONTINUATION OF ASSISTANCE TO THE NAVY IN PREPARATION OF CASE MATERIALS" RELATIVE TO THE WESTINGHOUSE CLAIM. NEGOTIATIONS WITH PMM WERE CONDUCTED THAT SAME DAY AND ON APRIL 23, PMM CONFIRMED BY LETTER THE UNDERSTANDINGS REACHED DURING THE PREVIOUS DAY'S NEGOTIATIONS. ON JUNE 27, 1974, THE NAVY EXECUTED A COST-PLUS-FIXED-FEE CONTRACT (NO. N00017-74- C-1215) WITH PMM FOR PREPARATION OF FOUR DOCUMENTS REQUIRED UNDER THE PLAN DEVELOPED PURSUANT TO MOD. 2. HOWEVER, IN OCTOBER 1974, THE NAVY AND WESTINGHOUSE ARRIVED AT A SETTLEMENT OF THE DISPUTED CLAIM. ACCORDINGLY, THE CONTRACT WAS MODIFIED TO PROVIDE FOR A REDUCTION IN BOTH THE WORK AND PRICE PREVIOUSLY AGREED UPON BY THE NAVY AND PMM. AS A RESULT OF THIS MODIFICATION, PMM WAS REQUIRED TO COMPLETE PERFORMANCE BY OCTOBER 11, 1974. BOTH THE APRIL 22 UNSOLICITED PROPOSAL AND THE AWARD BASED THEREON CONSTITUTE THE SUBJECT MATTER OF HANSEN'S PROTEST.

THE NAVY CONTENDS THAT HANSEN'S PROTEST FILED IN GAO ON JUNE 18, 1974, IS UNTIMELY UNDER OUR INTERIM BID PROTEST PROCEDURES AND STANDARDS, 4 CODE OF FEDERAL REGULATIONS (C.F.R) 20.2(A) (1974 ED.), WHICH PROVIDES THAT A PROTEST SHALL BE FILED NOT LATER THAN 5 DAYS AFTER THE BASIS FOR PROTEST IS KNOWN OR SHOULD HAVE BEEN KNOWN. FIRST, THE NAVY ASSERTS THAT HANSEN HAD KNOWLEDGE OF THE PROPOSED AWARD TO PMM AS EARLY AS APRIL 30, 1974, WHEN HANSEN WAS ADVISED DURING A TELEPHONE CONVERSATION WITH A REPRESENTATIVE OF THE NAVY CLAIMS TEAM, THAT THE SUBJECT CONTRACT WOULD BE AWARDED TO PMM BECAUSE OF ITS ACTIVE INVOLVEMENT THROUGHOUT THE LIFE OF THE MK 48 PROGRAM.

HANSEN, ON THE OTHER HAND, ASSERTS THAT:

"ON APRIL 30 WE ONLY HAD KNOWLEDGE THAT THE FOLLOW-ON CONTRACT HAD BEEN AWARDED TO PM&M; WE DID NOT HAVE KNOWLEDGE THAT THE FINAL CONTRACT WITH PM&M WAS IMMINENT. THE APRIL 30 KNOWLEDGE THAT WE HAD WAS ONLY THAT PM&M HAD BEEN GIVEN A VERY SMALL CONTRACT TO DEVELOP A PLAN FOR DEVELOPMENT OF A CHRONOLOGICAL ACCOUNT OF EVENTS RELATING TO THE PERFORMANCE OF WESTINGHOUSE. WE DID NOT HAVE ANY KNOWLEDGE WHATSOEVER THAT THE GOVERNMENT WAS INTENDING THAT PM&M BE SELECTED AS THE EXPERT WITNESS IN THIS CASE. WE ONLY HAD KNOWLEDGE OF THE COMPLETE CONTRACT AND ITS AWARD ON JUNE 11 AFTER HAVING RECEIVED THE COMMERCE BUSINESS DAILY ON JUNE 7."

WHILE THE NAVY'S MEMORANDUM OF THE APRIL 30 TELEPHONE CONVERSATION APPEARS TO SUPPORT THE NAVY'S POSITION WITH REGARD TO ITS CONTENT, WE BELIEVE IT WOULD BE UNFAIR TO DENY HANSEN THE OPPORTUNITY TO HAVE THE MERITS OF ITS PROTEST CONSIDERED BY THIS OFFICE ON THE BASIS THAT IT IS UNTIMELY WHERE THERE EXISTS A REASONABLE POSSIBILITY THAT THERE WAS A MISUNDERSTANDING AS TO THE SUBSTANCE OF THE CONVERSATION.

SECOND, THE NAVY CONTENDS THAT HANSEN'S PROTEST FILED HERE ON JUNE 18 SHOULD BE CONSIDERED UNTIMELY SINCE HANSEN SHOULD BE HELD TO HAVE NOTICE OF THE BASIS FOR ITS PROTEST BY REASON OF PUBLICATION OF NOTICE OF THE PROPOSED AWARD TO PMM IN THE CBD ON JUNE 7, 1974. ALTHOUGH THE NAVY'S POSITION MAY BE MERITORIOUS IF HANSEN'S PROTEST WAS INITIALLY FILED WITH OUR OFFICE, MATTER OF DEL NORTE TECHNOLOGY, INC., B-182318, JANUARY 25, 1975, WE NOTE THAT HANSEN INITIALLY PROTESTED TO THE NAVY ON JUNE 11, 1974, AND HAD NOT RECEIVED A DECISION ON ITS PROTEST FROM THE NAVY BEFORE FILING IN OUR OFFICE ON JUNE 18, 1974. IN THIS CONNECTION, OUR INTERIM BID PROTEST RULES AND PROCEDURES PROVIDE THAT IF A PROTEST HAS BEEN FILED INITIALLY WITH THE CONTRACTING AGENCY, ANY SUBSEQUENT PROTEST TO GAO FILED WITHIN 5 DAYS OF NOTIFICATION OF ADVERSE AGENCY ACTION WILL BE CONSIDERED PROVIDED THE INITIAL PROTEST TO THE AGENCY WAS MADE TIMELY. 4 C.F.R. 20.2(A), SUPRA. SINCE IT APPEARS THAT THE PROTEST TO THE NAVY WAS TIMELY, THAT THERE HAD BEEN NO ADVERSE ACTION THEREON AT THE TIME THE PROTEST WAS FILED WITH US, WE CONSIDER THE PROTEST TIMELY.

HOWEVER, AS EXPLAINED BELOW, WE DO NOT BELIEVE THAT THE NAVY VIOLATED APPLICABLE PROCUREMENT LAW OR REGULATIONS IN MAKING A SOLE SOURCE AWARD TO PMM. NOR DO WE FIND EVIDENCE IN THE RECORD TO JUSTIFY HANSEN'S ALLEGATION THAT PMM DERIVED AN UNFAIR COMPETITIVE ADVANTAGE FROM ITS ASSIGNMENT UNDER MOD. 2.

GENERALLY, SUPPLIES AND SERVICES FOR THE GOVERNMENT ARE REQUIRED TO BE PROCURED BY FORMAL ADVERTISING. THERE ARE INSTANCES, HOWEVER, WHEN FORMAL ADVERTISING IS NOT FEASIBLE, AND THE PROCUREMENT AGENCY IS AUTHORIZED TO NEGOTIATE A PURCHASE OR A CONTRACT. IN THIS REGARD, 10 U.S.C. 2304(A)(10) PROVIDES THAT A PROCUREMENT MAY BE NEGOTIATED IF "THE PURCHASE OR CONTRACT IS FOR PROPERTY OR SERVICES FOR WHICH IT IS IMPRACTICABLE TO OBTAIN COMPETITION." FURTHER, ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3.210 -2 (1974 ED.) SETS FORTH ILLUSTRATIVE CIRCUMSTANCES UNDER WHICH THE AUTHORITY TO NEGOTIATE UNDER SECTION 2304(A)(10) MAY BE USED. UNDER ASPR 3.210-2(A) CONTRACTS MAY BE NEGOTIATED WHERE SUPPLIES OR SERVICES CAN BE OBTAINED FROM ONLY ONE PERSON OR FIRM ("SOLE SOURCE OF SUPPLY"). ALSO, ASPR 3.210-2(M) (1974 ED.) STATES THAT CONTRACTS MAY BE NEGOTIATED WHEN IT IS IMPOSSIBLE TO DRAFT, FOR SOLICITATION OF BIDS, ADEQUATE SPECIFICATIONS OF THE REQUIRED SUPPLIES OR SERVICES. IN DETERMINING THE PROPRIETY OF A SOLE SOURCE AWARD THE STANDARD TO BE APPLIED IS ONE OF REASONABLENESS, AND UNLESS IT CAN BE SHOWN THAT THE CONTRACTING OFFICER ACTED UNREASONABLY, THERE IS NO LEGAL BASIS ON WHICH TO QUESTION THE AWARD. B-175953, JULY 21, 1972; 44 COMP. GEN. 590 (1965).

THE DETERMINATION TO NEGOTIATE CONTRACT NO. N00017-74-C-1205 UNDER 10 U.S.C. 2304(A)(10) IS SUPPORTED BY THE FOLLOWING FINDINGS:

"1. THE PROPOSED CONTRACT WILL PROVIDE FOR ASSISTANCE TO THE MK 48 MOD O CLAIM TEAM BY RESEARCH AND SUBMISSION OF REPORTS IN SUPPORT OF THE GOVERNMENT'S POSITION IN REGARD TO THE WESTINGHOUSE TORPEDO MK 48 MOD O CLAIM FOR EQUITABLE ADJUSTMENT.

"2. PROCUREMENT BY NEGOTIATION OF THE ABOVE ASSISTANCE FROM PEAT, MARWICK, MITCHELL & CO. (PMM & CO.), IS NECESSARY BECAUSE OF THE INTIMATE KNOWLEDGE OF PMM PERSONNEL WHO WILL BE ASSIGNED TO PERFORM THE EFFORT REQUIRED TO PROVIDE THE NEEDED REPORTS AND ASSISTANCE. PMM & CO., IS PRESENTLY PROVIDING SERVICES TO THE MK 48 PROGRAM OFFICE UNDER CONTRACT N00017-73-C-1205.

"3. USE OF FORMAL ADVERTISING FOR THE WORK DESCRIBED ABOVE IS IMPRACTICABLE AS ONLY THE ULTIMATE OBJECTIVES AND GENERAL SCOPE OF THE WORK CAN BE OUTLINED, AND FURTHER, IT IS IMPOSSIBLE TO DESCRIBE IN PRECISE DETAIL OR BY DEFINITE DRAWINGS AND SPECIFICATIONS THE NATURE OF THE WORK TO BE PERFORMED UNDER THE PROPOSED CONTRACT."

FURTHERMORE, THE CONTRACTING OFFICER EXPLAINED HIS DECISION TO NEGOTIATE WITH PMM ON A SOLE-SOURCE BASIS AS FOLLOWS:

"A. PMM, AS DOCUMENTED IN THE SOLE SOURCE MEMO ATTACHED, HAS HAD INVOLVEMENT WITH THE 64-C-0705 PROGRAM *** (CONTRACT OUT OF WHICH THE WESTINGHOUSE CLAIM AROSE) *** FROM INCEPTION AND IS PRESENTLY ENGAGED IN A SUPPORT ROLE TO THE PRODUCTION PROGRAM OF THE TORPEDO MK 48 PROJECT OFFICE. THIS HISTORICAL AND CONTINUAL INVOLVEMENT IS UNMATCHED BY ANY OTHER SOURCE.

"B. PMM WAS ABLE TO FIELD A TEAM OF PROFESSIONALS THOROUGHLY FAMILIAR WITH THE 64-C-0705 PROGRAM.

"(1) ITS DEPTH OF PERSONNEL WAS CLEARLY INDICATED WHEN ITS PRIMARY KEY MAN WAS UNFORTUNATELY SIDELINED BY A HEART ATTACK. IN HIS STEAD, PMM ASSIGNED ANOTHER INDIVIDUAL NOT ONLY CURRENTLY INVOLVED IN THE TORPEDO MK 48 PROGRAM BUT ALSO THOROUGHLY AWARE OF 64-C-0705 PROBLEMS AS RELATED TO HIS PAST WORK WITH THE MK 27 TARGETS AND PROOFING OF PPT'S AT NTS- KEYPORT.

"(2) THREE (3) SENIOR MEMBERS OF THE WASHINGTON OFFICE HAVING EXPERIENCE IN THE 64-C-0705 CONTRACT, IN ONE CASE DATING BACK TO 1966, WERE ASSIGNED ADVISORY AND REVIEW ROLES FOR THE PROPOSED CLAIM EFFORT.

"C. ANOTHER SENIOR FIRM MEMBER, THOROUGHLY FAMILIAR WITH DCAA OPERATIONS AS FORMER BRANCH HEAD OF THE BALTIMORE DCAA OFFICE, WAS ASSIGNED (1) ADVISORY ROLE FOR USE OF DCAA AND NAVPRO, AND (2) ASSIST IN ASBCA PRESENTATION, BASED ON HIS CONSIDERABLE EXPERIENCE WITH BROAD APPEARANCES DURING THE PAST SEVEN (7) YEARS.

"D. STAFF ASSISTANCE, PROVIDED BY PERSONNEL WITH GOVERNMENT ACCOUNTING EXPERIENCE AND PROFESSIONAL ENGINEERING BACKGROUND, WAS ALSO MADE AVAILABLE.

"E. ALL OF THE ABOVE PERSONNEL WERE ALREADY ON BOARD AND AVAILABLE FOR USE BY THE NAVY. NO FAMILIARITY RESEARCH WAS REQUIRED, AND IMMEDIATE ANALYSES INTO THE 64-C-0705 PROBLEMS, AS SPECIFIED BY THE NAVY CLAIM TEAM, WAS REALISTICALLY POSSIBLE.

"IN SUMMARY, PMM WAS THE ONLY SOURCE SO TOTALLY INVOLVED IN COST, CONTRACT, AND MANAGEMENT ANALYSES ON THE 64-C-0705 CONTRACT THAT THE SELECTION OF ANY OTHER SOURCE COULD NOT BE JUSTIFIED. PMM WAS THE ONLY SOURCE MEETING THE REQUIREMENTS OF KNOWLEDGE, DEPTH OF COGNIZANT PERSONNEL, AND ABILITY TO PROVIDE TIMELINESS OF RESPONSE." IN VIEW OF PMM'S INTIMATE KNOWLEDGE OF AND LONG INVOLVEMENT IN THE MK 48 PROGRAM AND IN VIEW OF THE IMPOSSIBILITY OF DRAFTING ADEQUATE SPECIFICATIONS, WE FIND NO REASON TO QUESTION THE REASONABLENESS OF THE CONTRACTING OFFICER'S DETERMINATION TO NEGOTIATE ONLY WITH PMM. IN VIEW OF THE FOREGOING CONCLUSION, IT IS IMMATERIAL WHETHER SUCH NEGOTIATION RESULTED FROM A SOLICITED OR UNSOLICITED PROPOSAL.

FURTHERMORE, WE ARE UNABLE TO INFER FROM THE FACT THAT PMM DRAFTED THE PLANS OR PRELIMINARY STUDY FOR THE NAVY DEFENSE AGAINST THE WESTINGHOUSE CLAIM THAT IT DERIVED AN UNFAIR COMPETITIVE ADVANTAGE IN SECURING THE CONTRACT IN QUESTION. WE HAVE LONG RECOGNIZED THAT THE MERE FACT THAT AN OFFEROR IS UNIQUELY QUALIFIED OR POSSESSED OF SUPERIOR EXPERIENCE DERIVED FROM PREVIOUS GOVERNMENT CONTRACTING WORK IS, IN ITSELF, NOT ENOUGH TO OVERTURN A CONTRACTING OFFICER'S DETERMINATION TO AWARD A CONTRACT TO THAT OFFEROR. IN B-153686, AUGUST 13, 1964, WE STATED THAT:

"WITH REGARD TO THE CHARGE OF UNFAIRNESS, *** THE ADVANTAGE ENJOYED BY DAYTON T. BROWN, INC., AS A RESULT OF ITS EXPERIENCE IN THE WORK IN QUESTION WAS A FACT. THAT THE GOVERNMENT PAID FOR THE WORK OUT OF WHICH THIS EXPERIENCE GREW AND, HENCE, 'FINANCED' IT, SEEMS UNAVOIDABLE. INDEED, IN A REAL SENSE THAT EXPERIENCE CONSTITUTES A VALUABLE BUSINESS ASSET. SUCH AN ASSET SHOULD NOT BE LIGHTLY WEIGHED OR DISCARDED.

CERTAINLY, IT WOULD HAVE BEEN IMPROPER FOR THE BUREAU TO HAVE IGNORED THAT ACCUMULATED EXPERIENCE IN CONNECTION WITH THE SUBJECT AWARD FOR THE PURPOSE OF TREATING ALL 'BIDDERS' AS HAVING EQUAL TECHNICAL CAPABILITY REGARDLESS OF THE ACTUAL FACTS.

"UPON REVIEW, WE FIND NO LEGAL BASIS TO OBJECT TO THE AWARD AS MADE. WHILE DAYTON T. BROWN, INC., ENJOYED AN 'IN HOUSE' CAPABILITY WHICH RESULTED FROM PREVIOUS GOVERNMENT WORK, WE ARE UNABLE TO AGREE THAT SUCH CAPABILITY CREATED AN 'UNFAIR' COMPETITIVE ADVANTAGE IN DAYTON T. BROWN, INC., TO THE EXCLUSION OF ALL OTHERS. THIS ACCUMULATION OF TECHNICAL CAPABILITIES, WHETHER THROUGH GOVERNMENT CONTRACTING OR OTHERWISE, MAY NOT BE IGNORED OR EQUALIZED FOR BENEFIT OF LESS QUALIFIED CONCERNS. IT WAS INCUMBENT UPON THE GOVERNMENT TO AWARD THE CONTRACT TO THE CONCERN HAVING THE HIGHEST TECHNICAL COMPETENCE, AND THE FACT THAT THE GOVERNMENT MAY HAVE PREVIOUSLY 'FINANCED' SUCH COMPETENCE WOULD NOT JUSTIFY AN AWARD TO A LESS QUALIFIED CONCERN TO THE POSSIBLE DETRIMENT OF THE GOVERNMENT. THE PROCUREMENT AGENCY IN THE EXERCISE OF ITS MANAGEMENT RESPONSIBILITY PROPERLY AWARDED THE CONTRACT TO THAT CONCERN WHICH WOULD PERFORM IN A MANNER MOST ADVANTAGEOUS TO THE GOVERNMENT."

ALTHOUGH PMM DERIVED A COMPETITIVE ADVANTAGE FROM HAVING PREPARED THE PLAN OR PRELIMINARY STUDY, WE DO NOT BELIEVE THAT THIS ADVANTAGE WAS UNFAIR.

FOR THE FOREGOING REASONS, THE PROTEST IS DENIED. SINCE WE HAVE CONCLUDED THAT THE NAVY DID NOT WRONGFULLY PRECLUDE HANSEN OR ANY OTHER PARTY FROM COMPETING FOR THIS PROCUREMENT, HANSEN'S CLAIM FOR MONEY DAMAGES ALSO IS DENIED.