B-183274(1), B-183274(2), MAY 19, 1975, 54 COMP GEN 973

B-183274(1),B-183274(2): May 19, 1975

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ITS DETERMINATION TO CANCEL SOLICITATION AND READVERTISE FOR BIDS ON BASIS THAT REQUIREMENT FOR FULL AND FREE COMPETITION WAS PRECLUDED WAS NOT IMPROPER. INCORPORATED (SCOTT) AND PHOTOMEDIA CORPORATION (PHOTOMEDIA) HAVE PROTESTED THE DETERMINATION MADE TO REJECT ALL BIDS SUBMITTED IN RESPONSE TO SOLICITATION NO. THE SUBJECT PROCUREMENT IS FOR MICRO-PHOTOGRAPHIC DUPLICATING FILMS (DIAZOTYPE AND THERMAL) FOR THE PERIOD JULY 1. THE SOLICITATION WAS ISSUED ON DECEMBER 16. WERE RECEIVED AND OPENED ON JANUARY 21. APPARENTLY SCOTT WAS THE LOW BIDDER ON DIAZOTYPE FILM. WHILE PHOTOMEDIA WAS LOW ON THERMAL FILM. AT THE TIME OF BID OPENING IT WAS NOTICED THAT XIDEX (THE INCUMBENT CONTRACTOR) HAD NOT SUBMITTED A BID.

B-183274(1), B-183274(2), MAY 19, 1975, 54 COMP GEN 973

BIDDERS - INVITATION RIGHT - FAILURE TO SOLICIT BIDS - ALL BIDS DISCARDED WHERE CONTRACTING AGENCY FAILED TO SOLICIT INCUMBENT CONTRACTOR, ONE OF LIMITED NUMBER OF MANUFACTURERS OF ITEMS BEING PROCURED, AND FAILED TO SYNOPSIZE PROCUREMENT IN COMMERCE BUSINESS DAILY, ITS DETERMINATION TO CANCEL SOLICITATION AND READVERTISE FOR BIDS ON BASIS THAT REQUIREMENT FOR FULL AND FREE COMPETITION WAS PRECLUDED WAS NOT IMPROPER.

IN THE MATTER OF SCOTT GRAPHICS, INC.; PHOTOMEDIA CORPORATION, MAY 19, 1975:

SCOTT GRAPHICS, INCORPORATED (SCOTT) AND PHOTOMEDIA CORPORATION (PHOTOMEDIA) HAVE PROTESTED THE DETERMINATION MADE TO REJECT ALL BIDS SUBMITTED IN RESPONSE TO SOLICITATION NO. FPHP-N-29709-H-1-21-75, ISSUED BY THE GENERAL SERVICES ADMINISTRATION (GSA), AND TO READVERTIZE THE PROCUREMENT.

THE SUBJECT PROCUREMENT IS FOR MICRO-PHOTOGRAPHIC DUPLICATING FILMS (DIAZOTYPE AND THERMAL) FOR THE PERIOD JULY 1, 1975, THROUGH JUNE 30, 1976. THE SOLICITATION WAS ISSUED ON DECEMBER 16, 1974, BY GSA TO 176 PROSPECTIVE BIDDERS. IN RESPONSE, FIVE BIDS, THREE FOR DIAZOTYPE AND TWO FOR THERMAL, WERE RECEIVED AND OPENED ON JANUARY 21, 1975, AND APPARENTLY SCOTT WAS THE LOW BIDDER ON DIAZOTYPE FILM, WHILE PHOTOMEDIA WAS LOW ON THERMAL FILM.

AT THE TIME OF BID OPENING IT WAS NOTICED THAT XIDEX (THE INCUMBENT CONTRACTOR) HAD NOT SUBMITTED A BID. INVESTIGATION REVEALED THAT XIDEX HAD BEEN DELETED FROM THE AUTOMATIC BIDDERS MAILING LIST MAINTAINED BY GSA (AND HAD NOT RECEIVED A COPY OF THE SOLICITATION) BECAUSE IT HAD NOT RESPONDED TO A PREVIOUS SOLICITATION FOR CAMERAS. THE FAILURE TO RESPOND TO THE CAMERA SOLICITATION JUSTIFIED REMOVAL OF XIDEX FROM THE LIST FOR CAMERAS BUT NOT FOR OTHER ITEMS SUCH AS FILM. A BUYER FOR GSA WHO WAS MANUALLY CROSS CHECKING AND SUPPLEMENTING THE AUTOMATIC LIST FOR FILM DID NOT NOTICE THE OMISSION BECAUSE HE MISREAD THE NAME OF A SOLICITED COMPANY, XEROX, AS XIDEX. IN ADDITION THE PROCUREMENT WAS NEVER SYNOPSIZED IN THE COMMERCE BUSINESS DAILY BECAUSE THERE WAS CONFUSION ON THE PART OF THE GSA BUYER AS TO PROPER TRANSMITTAL PROCEDURES.

XIDEX PROTESTED TO GSA BY TELEGRAM DATED JANUARY 24, 1975, AND GSA DECIDED TO CANCEL THE SOLICITATION AND READVERTISE. A NEW SOLICITATION (FPHP-N-29709-RA-3-13-75) WAS ISSUED FEBRUARY 21, 1975, AND BIDS WERE OPENED MARCH 13, 1975. NO AWARD HAS BEEN MADE PENDING OUR DECISION IN THIS MATTER.

THIS OFFICE RECOGNIZES THAT THE AUTHORITY VESTED IN THE CONTRACTING OFFICER TO CANCEL A SOLICITATION AND READVERTISE IS EXTREMELY BROAD, AND WE WILL ORDINARILY NOT QUESTION HIS ACTION. IN EXERCISING SUCH AUTHORITY, HOWEVER, THE CONTRACTING OFFICER MUST CONSIDER THE IMPACT UPON THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM. AS WAS STATED BY THE COURT OF CLAIMS IN MASSMAN CONSTRUCTION COMPANY V. UNITED STATES, 102 CT. CL. 699, 719 (1945), 60 F. SUPP. 635, 643, CERT. DENIED 325 U.S. 866 (1945);

TO HAVE A SET OF BIDS DISCARDED AFTER THEY ARE OPENED AND EACH BIDDER HAS LEARNED HIS COMPETITOR'S PRICE IS A SERIOUS MATTER, AND IT SHOULD NOT BE PERMITTED EXCEPT FOR COGENT REASONS.

TO THE SAME EFFECT, SEE FEDERAL PROCUREMENT REGULATIONS 1-2.404-1 (1964 ED.).

THE DIFFICULTY IN THIS CASE RESULTS FROM THE NECESSITY TO APPLY THE ABOVE STANDARDS TO THE CIRCUMSTANCES HERE SO AS TO INSURE THE FULL AND FREE COMPETITION CONTEMPLATED BY STATUTE (41 U.S. CODE 253(A)), AND AT THE SAME TIME PRESERVE THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM. THE OPPOSING VIEWS AS TO HOW TO REACH THESE OBJECTIVES ARE EXPRESSED BELOW.

ALTHOUGH GSA DOES NOT CONTEND THAT UNREASONABLE PRICES WERE OBTAINED UNDER THE INITIAL SOLICITATION, GSA TAKES THE POSITION THAT BECAUSE ONE OF A LIMITED NUMBER OF MANUFACTURERS FOR THESE ITEMS WAS NOT SOLICITED, FULL AND FREE COMPETITION WAS PRECLUDED. SPECIFICALLY, GSA REPORTS THAT THE INCUMBENT WAS ONE OF ONLY THREE KNOWN MANUFACTURERS OF THERMAL FILM AND ONE OF ONLY SEVEN KNOWN MANUFACTURERS OF DIAZOTYPE FILM (TWO OF WHICH HAD NOT BID IN RECENT YEARS). WE HAVE BEEN ADVISED BY GSA THAT THE FILM MANUFACTURERS HAVE RECEIVED SUBSTANTIALLY ALL THE AWARDS FOR THESE PROCUREMENTS. IN SHORT, GSA FEELS ITS FAILURE TO SOLICIT THE INCUMBENT IN EFFECT TAINTED THE COMPETITION. UNDER THE CIRCUMSTANCES, GSA BELIEVES THAT ITS ACTIONS IN CANCELING AND READVERTISING "ENHANCED THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM." MOREOVER, GSA BELIEVES THAT OUR DECISION, B-160975, MARCH 28, 1967, IS DIRECTLY ON POINT AND SUPPORTS ITS ACTIONS IN THIS CASE.

THE PROTESTERS HAVE DRAWN ATTENTION TO A NUMBER OF OUR DECISIONS WHICH HOLD THAT INADVERTENT ACTION ON THE PART OF THE AGENCY WHICH PRECLUDES A POTENTIAL SUPPLIER (EVEN AN INCUMBENT CONTRACTOR) FROM SUBMITTING A BID IS NOT A COMPELLING REASON FOR A RESOLICITATION SO LONG AS ADEQUATE COMPETITION AND REASONABLE PRICES WERE OBTAINED AND THERE WAS NO DELIBERATE OR CONSCIOUS ATTEMPT TO PRECLUDE THE POTENTIAL SUPPLIER FROM BIDDING. B-167379, AUGUST 15, 1969; B-171213, DECEMBER 31, 1970; B- 175217, APRIL 6, 1972; B-176261, AUGUST 14, 1972.

IN NONE OF THESE DECISIONS, HOWEVER, HAVE WE ADDRESSED A SITUATION IN WHICH THERE WAS CUMULATIVELY A DELETION FROM THE BIDDERS MAILING LIST OF A CURRENT CONTRACTOR, THE FAILURE TO SYNOPSIZE IN THE COMMERCE BUSINESS DAILY, AND ONLY A SMALL NUMBER OF KNOWN MANUFACTURERS OF THE ITEMS. ONE DECISION IN WHICH WE HAVE CONSIDERED A RESOLICITATION BASED UPON CIRCUMSTANCES SIMILAR TO THE PRESENT CASE, WE REFRAINED FROM APPLYING THE STANDARD ADVOCATED BY THE PROTESTERS AND INSTEAD WE DETERMINED THAT THERE WAS NO LEGAL OBJECTION TO THE DETERMINATION BY THE AGENCY THAT A COMPELLING REASON FOR RESOLICITATION EXISTED. B 160975, SUPRA. IN THAT DECISION WE TOOK NOTE THAT: (1) THE CURRENT CONTRACTOR WHO HAD REQUESTED THAT ITS NAME BE PLACED ON THE BIDDERS MAILING LIST HAD, DUE TO THE AGENCY'S MISUNDERSTANDING, NOT RECEIVED A SOLICITATION; (2) THE PROCUREMENT HAD NOT BEEN SYNOPSIZED IN THE COMMERCE BUSINESS DAILY; AND (3) THERE WAS A SMALL NUMBER OF FIRMS ON THE BIDDERS MAILING LIST. THAT BASIS WE DETERMINED THAT RESOLICITATION WAS NOT OBJECTIONABLE.

IN THE PRESENT CASE, THE SITUATION IS SIMILAR EXCEPT THAT 176 FIRMS WERE SOLICITED. HOWEVER, WE DO NOT BELIEVE THIS DISTINCTION IS SIGNIFICANT SINCE, AS NOTED ABOVE, ONLY A LIMITED NUMBER OF THOSE 176 FIRMS WERE MANUFACTURERS, WHILE ONE FILM MANUFACTURER, THE INCUMBENT, WAS NOT SOLICITED. AS INDICATED, IN RECENT YEARS ONLY A FEW FILM MANUFACTURERS HAVE RECEIVED SUBSTANTIALLY ALL OF THE AWARDS MADE FOR THESE PROCUREMENTS. THEREFORE, WE SEE NO BASIS FOR DEVIATING FROM OUR RATIONALE IN B-160975, SUPRA.

FURTHERMORE, IT IS OUR VIEW THAT IN THE CIRCUMSTANCES THE OBJECTIVES OF OBTAINING FULL AND FREE COMPETITION AND OF PRESERVING THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM MAY BEST BE ACHIEVED BY SUSTAINING THE ADMINISTRATIVE DECISION TO RESOLICIT BIDS.

FINALLY, SCOTT HAS ALLEGED THAT XIDEX WAS NOT PREJUDICED AND ITS PROTEST TO GSA WAS UNTIMELY AS IT HAD ACTUAL OR CONSTRUCTIVE KNOWLEDGE OF THE SOLICITATION PRIOR TO BID OPENING AND REMAINED SILENT UNTIL AFTER BID OPENING. XIDEX HAS DENIED THIS ALLEGATION, AND WE DO NOT HAVE SUFFICIENT EVIDENCE TO RESOLVE THIS FACTUAL DISPUTE.

ACCORDINGLY, THE PROTESTS ARE DENIED.