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B-161653, JUL. 17, 1967

B-161653 Jul 17, 1967
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COUNSELLORS AT LAW: REFERENCE IS MADE TO YOUR LETTER OF JUNE 7. BIDS WERE REQUESTED FOR A CIRCUIT BREAKER TEST UNIT FOR THE GRAND COULEE POWERPLANT. INCLUDED IN THE INVITATION WAS A PROVISION ENTITLED. WHICH IN ITS ENTIRETY IS AS FOLLOWS: "1. BIDDERS ARE ADVISED THAT INCLUSION OF TERMS. IF BIDDER'S STANDARD COMMERCIAL QUOTATION OR PROPOSAL FORMS ARE USED IN CONNECTION WITH THIS BID. OR PROVISIONS APPEARING ON SUCH FORMS ARE INCONSISTENT WITH THE TERMS OF THIS INVITATION. THE BIDDER SHOULD SIGN THE FOLLOWING STATEMENT TO INSURE THAT HIS BID IS CONSISTENT WITH THE TERMS OF THIS INVITATION: "ALL STANDARD COMMERCIAL TERMS. OR PROVISIONS STATED ON ANY OF BIDDER'S STANDARD COMMERCIAL QUOTATION OR PROPOSAL FORMS USED IN CONNECTION WITH THIS BID ARE HEREBY EXCLUDED FROM THIS BID.

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B-161653, JUL. 17, 1967

BIDS - DEVIATIONS - PROPRIETARY DATA, ETC. A DECISION TO A PROTESTING LOW BIDDER FOR AWARD OF A CONTRACT FOR A CIRCUIT BREAKER TEST UNIT FOR GRAND COULEE POWERPLANT HOLDING THAT THE FACT THAT SUCH BIDDER QUALIFIED HIS BID BY A NOTE CONCERNING THE GOVT.'S RIGHT TO USE THE DATA THE BID CONTAINED A MATERIAL DEVIATION REQUIRING REJECTION OF THE BID AS NONRESPONSIVE.

TO JEROME C. EISENBERG, ESQUIRE, MULTI-AMP CORPORATION, C/O CLAPP AND EISENBERG, COUNSELLORS AT LAW:

REFERENCE IS MADE TO YOUR LETTER OF JUNE 7, 1967, PROTESTING ON BEHALF OF MULTI-AMP CORPORATION (MULTI-AMP) AGAINST REJECTION OF ITS BID UNDER INVITATION NO. (D) J-38, 328-A ISSUED BY THE BUREAU OF RECLAMATION, DEPARTMENT OF THE INTERIOR.

ON MARCH 10, 1967, BIDS WERE REQUESTED FOR A CIRCUIT BREAKER TEST UNIT FOR THE GRAND COULEE POWERPLANT, COLUMBIA BASIN PROJECT. INCLUDED IN THE INVITATION WAS A PROVISION ENTITLED,"STANDARD COMMERCIAL TERMS AND CONDITIONS", WHICH IN ITS ENTIRETY IS AS FOLLOWS:

"1. BIDDERS ARE ADVISED THAT INCLUSION OF TERMS, CONDITIONS, OR PROVISIONS OTHER THAN THOSE CONTAINED IN THIS INVITATION MAY BE CAUSE FOR REJECTION OF THE BID AS NONRESPONSIVE.

"2. IF BIDDER'S STANDARD COMMERCIAL QUOTATION OR PROPOSAL FORMS ARE USED IN CONNECTION WITH THIS BID, AND ANY TERMS, CONDITIONS, OR PROVISIONS APPEARING ON SUCH FORMS ARE INCONSISTENT WITH THE TERMS OF THIS INVITATION, THE BIDDER SHOULD SIGN THE FOLLOWING STATEMENT TO INSURE THAT HIS BID IS CONSISTENT WITH THE TERMS OF THIS INVITATION:

"ALL STANDARD COMMERCIAL TERMS, CONDITIONS, OR PROVISIONS STATED ON ANY OF BIDDER'S STANDARD COMMERCIAL QUOTATION OR PROPOSAL FORMS USED IN CONNECTION WITH THIS BID ARE HEREBY EXCLUDED FROM THIS BID;, BIDS WERE OPENED ON MARCH 31, 1967, AND THE LOW BID OF $5,851.49 WAS SUBMITTED BY MULTI-AMP. HOWEVER, ON THE PAGE OF THE INVITATION ENTITLED "STANDARD COMMERCIAL TERMS AND CONDITIONS" YOU INSERTED THE FOLLOWING:

"EXCEPT AS NOTED BELOW

"NOTE: THIS BID IS SUBMITTED PURSUANT TO IFB NO. (D) J-38, 328-A ON CONDITION THAT IT IS INTENDED BY THE BIDDER THAT THE INSTRUCTIONS (DATA) AND THE EQUIPMENT DESCRIBED THEREIN SHALL REMAIN PROPRIETARY WITH THE BIDDER AND THAT THE GOVERNMENT SHALL NOT HAVE THE UNLIMITED RIGHT TO REPRODUCE, SELL, MANUFACTURE, OR DESIGN SAID EQUIPMENT OR DATA. SAID DATA IS PROVIDED SOLELY FOR THE SPECIFIC PURPOSE OF PROVIDING OPERATING DATA AND MAINTENANCE INFORMATION FOR USE WITH THE EQUIPMENT DESCRIBED. SAID DATA WAS DEVELOPED BY MULTI-AMP INDEPENDENTLY WITHOUT THE ASSISTANCE OF THE GOVERNMENT AND WITHOUT COST TO THE GOVERNMENT ON THIS OR ANY PRIOR CONTRACT;,

ADDITIONALLY, ON THE OUTER COVER OF YOUR COMMERCIAL CATALOG, WHICH ACCOMPANIED YOUR BID, THERE IS A PROVISION WHICH STATES:

"THE INFORMATION AND MATERIAL CONTAINED WITHIN THIS CATALOG ARE PROPRIETARY WITH MULTI-AMP CORPORATION, AND THE EQUIPMENT DESCRIBED HEREIN MAY BE PROTECTED BY ONE OR MORE U.S. LETTERS PATENT. MULTI-AMP SPECIFICALLY RESERVES TO ITSELF ALL RIGHTS TO SUCH PROPRIETARY INFORMATION AS WELL AS ALL RIGHTS UNDER SUCH PATENT, NONE OF WHICH IS WAIVED BY THE SUBMISSION OF THIS CATALOG TO ANYONE. THE RECIPIENT OF THIS CATALOG IS NOT AUTHORIZED TO REPRODUCE, DESIGN, MANUFACTURE, SOLICIT FOR OR SELL THE INFORMATION, MATERIAL, OR EQUIPMENT DESCRIBED, FOR HIS OWN USE OR FOR THE USE OF OTHERS, IN ANY FORM WHATSOEVER WITHOUT THE EXPRESS AUTHORIZATION OF MULTI-AMP;,

BECAUSE OF THE ABOVE "NOTE", YOUR BID WAS REJECTED AS NONRESPONSIVE TO THE TERMS OF THE INVITATION, AND THE CONTRACT WAS AWARDED ON MAY 24, 1967, TO TRAN-REX EQUIPMENT DEPARTMENT, BORG-WARNER CONTROLS, DIVISION OF BORG- WARNER CORPORATION, THE SECOND LOW BIDDER, AT A BID PRICE OF $6,550.

IT IS YOUR CONTENTION THAT THE GOVERNMENT'S RIGHT TO OWN AND USE THE EQUIPMENT WOULD BE UNLIMITED AND UNRESTRICTED IF YOUR BID WAS ACCEPTED, AND THE ONLY LIMITATION, EXPRESSED OR INTENDED, IS ON THE GOVERNMENT'S RIGHT TO REPRODUCE, SELL, AND MANUFACTURE THE EQUIPMENT. CONCERNING THIS CONTENTION, YOUR REPRESENTATIVES HAVE ORALLY ADVISED THAT THE FIRST "AND" IN THE FIRST SENTENCE OF THE EXCEPTION SHOULD HAVE BEEN "FOR", AND HAD ORIGINALLY BEEN SUCH, BUT DUE TO A TYPOGRAPHICAL ERROR WAS TYPED ON THE BID FORM AS "AND;, NOTWITHSTANDING SUCH ERROR IT IS CONTENDED THAT THE EXCEPTION WOULD NOT OPERATE TO RESTRICT THE GOVERNMENT'S USE OR OWNERSHIP OF THE EQUIPMENT, AND THAT THE BID THEREFORE SHOULD BE CONSIDERED RESPONSIVE TO THE INVITATION.

SECTION 1-2.404-2 (A) OF THE FEDERAL PROCUREMENT REGULATIONS, STATES THAT "ANY BID WHICH FAILS TO CONFORM TO THE ESSENTIAL REQUIREMENTS OF THE INVITATION FOR BIDS, SUCH AS SPECIFICATIONS, DELIVERY SCHEDULE, OR PERMISSIBLE ALTERATIONS THERETO, SHALL BE REJECTED AS NONRESPONSIVE;, SUBSECTION (B) ADDS "ORDINARILY, A BID SHALL BE REJECTED WHERE THE BIDDER IMPOSES CONDITIONS WHICH WOULD MODIFY REQUIREMENTS OF THE INVITATION FOR BIDS OR LIMIT HIS LIABILITY TO THE GOVERNMENT SO AS TO GIVE HIM AN ADVANTAGE OVER OTHER BIDDERS;,

WHILE THE LANGUAGE IN THE "NOTE" WOULD BE MORE APPROPRIATE TO LIMIT THE GOVERNMENT'S RIGHT TO USE THE DATA CONTAINED IN YOUR COMMERCIAL CATALOG, IT WOULD APPEAR THAT THIS PURPOSE WAS ALREADY SERVED BY THE PROVISION ON THE OUTER COVER OF YOUR CATALOG, AND SUCH PROVISION COULD NOT HAVE RENDERED THE BID NONRESPONSIVE SINCE THERE IS NO EVIDENCE THE GOVERNMENT WAS SEEKING PROPRIETARY INFORMATION FOR ANY USE OTHER THAN INFORMATION PURPOSES. HOWEVER, THERE CAN BE NO DOUBT THAT THE "NOTE", READ IN ITS ENTIRETY, LIMITS THE GOVERNMENT'S RIGHT TO SELL SAID EQUIPMENT, THUS INFERRING THAT THE GOVERNMENT'S TITLE IN THE EQUIPMENT IS SOMETHING LESS THAN THAT ACQUIRED IN AN OUTRIGHT PURCHASE OF THE EQUIPMENT AND RAISING A DIFFICULT QUESTION AS TO EXACTLY WHAT PROPERTY RIGHTS WOULD HAVE BEEN OBTAINED BY THE GOVERNMENT AND HOW SUCH RIGHTS WOULD BE DETERMINED. WHERE ONE BIDDER LIMITS THE RIGHT OR INTEREST WHICH THE GOVERNMENT HAS IN THE SUBJECT MATTER OF THE CONTRACT, SUCH LIMITATION NOT BEING PERMITTED TO THE OTHER BIDDERS BY THE ADVERTISED CONDITIONS AND SPECIFICATIONS, IT IS CLEAR THAT A CONTRACT AWARDED ON THE BASIS OF SUCH A BID WOULD NOT BE A CONTRACT OFFERED TO ALL BIDDERS. THE ADVERTISED CONDITIONS AND SPECIFICATIONS MAKE NO PROVISION FOR A QUALIFICATION WHICH WOULD LIMIT THE GOVERNMENT'S RIGHT OF DISPOSAL OF EQUIPMENT PURCHASED UNDER A SUPPLY CONTRACT, AND SINCE THE CONTRACT OFFERED TO THE SUCCESSFUL BIDDER MUST BE THE CONTRACT OFFERED ALL BIDDERS, 44 COMP. GEN. 193; 36 COMP. GEN. 535, 539; 16 COMP. GEN. 392, TO PERMIT MULTI-AMP TO QUALIFY ITS BID IN THIS MANNER MUST BE CONSIDERED PREJUDICIAL TO THE RIGHTS OF OTHER BIDDERS. THE QUALIFICATION IN YOUR BID MUST THEREFORE BE CONSIDERED A MATERIAL DEVIATION WHICH CANNOT BE WAIVED. SEE 30 COMP. GEN. 179; B-146039, JULY 20, 1961.

ACCORDINGLY, WE MUST CONCLUDE THAT YOUR BID WAS PROPERLY REJECTED AND YOUR PROTEST MUST BE DENIED.

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