B-153564, JUL. 21, 1964

B-153564, JUL. 21, 1964

TO BULOVA WATCH COMPANY, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF MAY 8 AND LETTER OF MAY 21, 1964, AMPLIFYING YOUR PROTEST AGAINST THE AWARD OF A CONTRACT TO BENRUS WATCH COMPANY UNDER REQUEST FOR PROPOSALS NO. AMC/A/36-038 64-490/NN), DATED FEBRUARY 7, 1964. YOUR ORIGINAL PROTEST WAS DENIED BY OUR DECISION TO YOU DATED MAY 4, 1964.

IN YOUR PRESENT LETTER YOU CONTEND THAT ALTHOUGH FRANKFORD ARSENAL PROCEEDED WITHIN THE SCOPE OF EXISTING REGULATIONS, IT SHOULD NOT BE PERMITTED TO AWARD A CONTRACT TO BENRUS BECAUSE OF CERTAIN FACTORS WHICH YOU BELIEVE MERIT FURTHER CONSIDERATIONS. TO AVOID REPEATING YOUR VARIOUS ALLEGATIONS THE PARAGRAPHS IN YOUR LETTER HAVE BEEN NUMBERED (1 TO 21) AND THE FOLLOWING COMMENTS RELATE TO PARAGRAPHS WHICH SEEM PARTICULARLY GERMANE TO THE PROTEST.

PARAGRAPH 6 (PAGES 1 AND 2). WHILE YOUR STATEMENTS APPEAR TO BE CORRECT, FRANKFORD ARSENAL REPORTS THAT REVIEW OF THE COMMENTS IN YOUR LETTER OF JULY 17, 1962, DID NOT WARRANT REVISION OF THE PROPOSED SPECIFICATION AS SUGGESTED BY YOU AND THAT IT WAS BELIEVED NO BENEFIT COULD RESULT FROM SUCH A MEETING.

PARAGRAPH 7. THE DETAILED QUESTIONS PROPOSED BY YOU IN RELATION TO THE TECHNICAL AND GUARANTEE PROVISIONS OF SPECIFICATION MIL-W-3818B AS SET FORTH IN YOUR LETTERS OF DECEMBER 26, 1962, AND MARCH 22, 1963, WERE CONSIDERED BY FRANKFORD ARSENAL BUT DID NOT WARRANT MODIFICATION OF THE SPECIFICATION FOR THE REASON THAT THE PROPOSED CHANGES WOULD NOT MATERIALLY IMPROVE THE TYPE WATCHES CONTEMPLATED FOR PROCUREMENT.

PARAGRAPH 8 (PAGES 2 AND 3) AND PARAGRAPH 9. FRANKFORD ARSENAL REPORTS THAT IT DID NOT PROMISE THAT AN AMENDMENT WOULD BE ISSUED TO SPECIFICATION MIL-W-3818B; ONLY THAT COMMENTS OR CHANGES PROPOSED BY YOU WOULD BE CONSIDERED; AND THAT THE PROPOSED CHANGES IN FACT WERE CONSIDERED BUT THEY DID NOT WARRANT AN AMENDMENT TO THE SPECIFICATION BECAUSE THEIR ADOPTION WOULD NOT MATERIALLY CHANGE OR IMPROVE THE PRODUCT BEING PROCESSED. FURTHER, IT IS REPORTED THAT AN ADDITIONAL SOURCE, CLINTON WATCH COMPANY, CHICAGO, ILLINOIS, SUBMITTED QUALIFICATION TEST SAMPLES ON JUNE 1, 1964, MAKING A TOTAL OF FOUR FIRMS TAKING NO EXCEPTIONS TO THE SPECIFICATION. HOWEVER, SINCE IT APPEARS FROM THE MINUTES OF A CONFERENCE HELD AT FRANKFORD ARSENAL ON FEBRUARY 21, 1963, CONCERNING SPECIFICATION MIL-W- 3818B, THAT THERE WERE CERTAIN TECHNICAL ERRORS IN THE SPECIFICATIONS, WE BELIEVE A CLARIFYING AMENDMENT SHOULD HAVE BEEN ISSUED AND THAT IT WOULD HAVE BEEN HELPFUL IF THIS HAD BEEN DONE.

PARAGRAPH 10. YOU WERE AFFORDED AMPLE OPPORTUNITY (SINCE DECEMBER 6, 1962) TO SUBMIT YOUR PRODUCT FOR QUALIFICATION TESTING AND POSSIBLE INCLUSION ON THE QUALIFIED PRODUCTS LIST. YOU HAD NOT DONE SO AT THE TIME THE REQUEST FOR PROPOSALS WAS SOLICITED ON FEBRUARY 7, 1964, AND DID NOT DO SO UNTIL FEBRUARY 13, 1964, AFTER A LAPSE OF 14 MONTHS. YOUR PRODUCT WAS REJECTED ON MARCH 11, 1964, FOR THE REASON THAT IT FAILED THE SHOCK TEST PERFORMANCE REQUIRED BY PARAGRAPH 4.8.9 OF SPECIFICATION MIL-W-3818B TO THE EXTENT THAT OVER A PERIOD OF 20 HOURS THE WATCH GAINED 1 HOUR AND 22 MINUTES. THE MAGNITUDE AND SIGNIFICANCE OF THIS FAILURE WAS CONSIDERED A SUFFICIENT CAUSE TO REJECT YOUR PRODUCT AND THUS DISQUALIFY IT FOR INCORPORATION INTO THE QUALIFIED PRODUCTS LIST. BY FRANKFORD ARSENAL LETTER OF APRIL 20, 1964, YOU WERE FURNISHED DATA SHOWING THAT YOUR PRODUCT FAILED TO MEET MINIMUM REQUIREMENTS FOR QUALIFICATION APPROVAL. BY LETTER OF MAY 22, 1964, YOU ACKNOWLEDGED FAILURE OF YOUR PRODUCT AND INDICATED THE CORRECTIVE ACTION TO BE PURSUED FOR RESUBMISSION FOR QUALIFICATION APPROVAL.

PARAGRAPH 11 (PAGES 3 AND 4). PARAGRAPHS 3.21 OF MIL-W-3818B REQUIRES THE CONTRACTOR TO BE LIABLE FOR THE REPAIR OF WATCHES THAT FAIL TO MEET ALL SPECIFICATIONS FOR A PERIOD OF TWO YEARS AFTER ACCEPTANCE BY THE GOVERNMENT. FRANKFORD ARSENAL REPORTS THAT GUARANTEE PROVISIONS SUGGESTED BY YOU AND HAMILTON WERE CONSIDERED BUT THAT NO COMMITMENT WAS MADE THAT SUCH CONSIDERATION WOULD RESULT IN AN AMENDMENT TO MIL-W-3818B; ALSO, THAT THE ALTERNATE PROVISIONS WERE REVIEWED BY QUALIFIED GOVERNMENT LEGAL AND TECHNICAL PERSONNEL AND WERE NOT CONSIDERED ACCEPTABLE BECAUSE OF THE LIMITATIONS CONTAINED THEREIN. HOWEVER, SINCE FRANKFORD ARSENAL REPORTS THAT THE GUARANTEE PROVISION WOULD NOT IMPOSE ON A CONTRACTOR THE RESPONSIBILITY OF REPAIRING WATCHES WHICH WERE ABUSED OR MISUSED IN THE FIELD, IT IS APPARENT THAT SOMETHING LESS THAN LITERAL COMPLIANCE IS INTENDED. SUCH BEING THE CASE, WE BELIEVE THE GUARANTEE PROVISION SHOULD BE REVISED TO SHOW WHAT IS INTENDED.

PARAGRAPH 12. AS INDICATED ABOVE, THE CHANGES PROPOSED BY YOU IN THE GUARANTEE PROVISION WERE IN FACT CONSIDERED BY FRANKFORD ARSENAL PERSONNEL BUT NO COMMITMENTS WERE MADE THAT THE ISSUANCE OF AN AMENDMENT TO THE SPECIFICATION WOULD RESULT THEREFROM. ALTHOUGH NO SPECIFIC REPLY WAS MADE TO YOU AS TO THE CHANGES SUBMITTED, THE AUTHORIZATION GIVEN TO YOU ON MAY 10, 1963, TO SUBMIT QUALIFICATION SAMPLES (AFTER THE CHANGES WERE REQUESTED) WAS CONSIDERED ADEQUATE NOTICE THAT THE ORIGINAL SPECIFICATION WOULD NOT BE CHANGED. HOWEVER, IT APPEARS THAT YOU COULD HAVE BEEN SPECIFICALLY NOTIFIED TO THAT EFFECT. AS PREVIOUSLY STATED, YOU HAVE NOT SUBMITTED A PRODUCT WHICH CONFORMS TO THE REQUIREMENTS OF MIL-W-3818B.

PARAGRAPH 13 (PAGES 4 AND 5). THE RECORD SHOWS THAT FRANKFORD ARSENAL INVITED ALL SOURCES PREVIOUSLY LISTED ON THE QUALIFIED PRODUCTS LIST UNDER MIL-W-3818A TO PARTICIPATE IN THE SUBMISSION OF SAMPLES FOR QUALIFICATION APPROVAL UNDER MIL-W-3818B. IN ADDITION, THE NOTICE TO ESTABLISH A QUALIFIED PRODUCTS LIST FOR THIS ITEM WAS SYNOPSIZED ON NOVEMBER 5, 1962. THREE SOURCES SUBMITTED SAMPLES ON MIL W-3818B PRIOR TO THE INITIATION OF THIS PROCUREMENT ACTION, AND ONLY ONE, BENRUS, SUBMITTED AN ACCEPTABLE PRODUCT. SUBSEQUENTLY YOU AND CLINTON SUBMITTED SAMPLES. YOUR SAMPLE WAS REJECTED FOR FAILURE TO MEET MINIMUM SPECIFICATION REQUIREMENTS. AS OF JUNE 16, 1964, THE CLINTON SAMPLE WAS UNDERGOING QUALIFICATION TESTS.

PARAGRAPH 14. SINCE THE BENRUS PRODUCT WAS THE ONLY PRODUCT APPROVED AS QUALIFYING UNDER THE SPECIFICATION, NEGOTIATION WITH BENRUS WAS PROPER. THE RECORD SHOWS THAT YOU WERE AFFORDED AMPLE OPPORTUNITY TO SUBMIT YOUR PRODUCT FOR QUALIFICATION, AND DOES NOT SUPPORT YOUR ALLEGATIONS THAT FRANKFORD ARSENAL PERSONNEL ACTED IN A PREJUDICIAL MANNER IN THIS PROCUREMENT.

PARAGRAPH 15. WHILE PROCUREMENT AGENCIES SHOULD BE, AND WE BELIEVE ARE, INTERESTED IN REVIEWING AND CONSIDERING PROPOSED CHANGES IN SPECIFICATIONS SUBMITTED BY CONTRACTORS IN THE INDUSTRY INVOLVED, THEY ARE NOT OBLIGATED TO ACCEPT SUCH CHANGES TO THE SATISFACTION OF THE SOURCES SUBMITTING SUCH PROPOSALS.

PARAGRAPH 17. THE JEWEL BEARING CLAUSE UTILIZED IN REQUEST FOR PROPOSALS NO. AMC/A/36-38-64-490/NN) REQUIRES THE SUCCESSFUL CONTRACTOR TO PROCURE JEWEL BEARINGS FROM TURTLE MOUNTAIN ORDNANCE PLANT; HOWEVER, ARMED SERVICES PROCUREMENT REGULATION 1-315 IN EFFECT AT THE TIME HERE INVOLVED DOES NOT CLEARLY REQUIRE THEIR USE IN THE END PRODUCT. THIS IS INDICATED BY ARMY CIRCULAR 715-2-11, PARAGRAPH XI, DATED OCTOBER 25, 1962. WHILE THAT CIRCULAR EXPIRED OCTOBER 25, 1963, THE ASPR PROVISION ON WHICH IT WAS BASED CONTINUED IN EFFECT UNTIL REVISION NO. 5, DATED MAY 11, 1964, EFFECTIVE AUGUST 10, 1964. IN ANY EVENT, UNDER ASPR 1-315 THE REQUIREMENT TO PURCHASE JEWEL BEARINGS FROM THE TURTLE MOUNTAIN ORDNANCE PLANT MAY BE WAIVED IN WHOLE OR PART IF THE DELIVERY SCHEDULE CANNOT BE SATISFIED BY THE REQUIREMENT, IN WHICH EVENT THE CONTRACT PRICE WOULD BE FOR ADJUSTMENT.

PARAGRAPH 18. AS INDICATED ABOVE, THE REGULATIONS IN EFFECT AT THE TIME HERE INVOLVED REQUIRE THE SUCCESSFUL CONTRACTOR TO PROCURE JEWEL BEARINGS FROM TURTLE MOUNTAIN ORDNANCE PLANT BUT DO NOT CLEARLY REQUIRE THE USE OF THOSE SAME BEARINGS IN THE END PRODUCT. THE LATTER REQUIREMENT DOES NOT BECOME EFFECTIVE UNTIL AUGUST 10, 1964, THE EFFECTIVE DATE OF REVISION NO. 5. THIS PROCUREMENT WAS INSTITUTED PRIOR TO THE PUBLICATION OF THE NEW REGULATIONS AND THE CONTRACTING PARTIES HAVE NEGOTIATED THE PROPOSED CONTRACT IN ACCORDANCE WITH THE REGULATIONS AS THEY EXISTED AT THAT TIME.

PARAGRAPHS 19, 20 AND 21 ARE ANSWERED IN THE REPLIES TO PARAGRAPHS 17 AND 18.

SINCE THE ALLEGATIONS ARE NOT SIGNIFICANTLY DIFFERENT THAN THOSE PRESENTED IN THE PROTEST OF FEBRUARY 20, 1964, AND CONSIDERED IN THE DECISION OF MAY 4, 1964, THAT DECISION IS ADHERED TO. ..END :