B-164319, JUN. 10, 1968

B-164319, JUN. 10, 1968

TO CATALYTIC ENGINEERING AND MANUFACTURING CORP.:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF MAY 13, 1968, PROTESTING THE AWARD OF A CONTRACT BY THE GOVERNMENT TO NOLECULAR PRODUCTS INC. CALLING FOR THE MANUFACTURE OF A CARTRIDGE WHICH IS IDENTICAL WITH FSN 4440-999- 7117, AN ITEM PRESENTLY COVERED UNDER YOUR REQUIREMENTS CONTRACT NO. BSA700-68-C-5991 WITH THE DEFENSE SUPPLY AGENCY (DSA).

THE RECORD SHOWS THAT CONTRACT NO. DSA700-68-C-5991 WAS AWARDED TO YOUR CORPORATION ON MARCH 8, 1968, BY THE DEFENSE CONSTRUCTION SUPPLY CENTER. THE CONTRACT CALLED FOR THE DELIVERY OF 9,762 DEHYDRATOR CARTRIDGES WITH AN OPTION IN THE GOVERNMENT TO ORDER ADDITIONAL QUANTITIES IN AMOUNTS OF 9,762, 4,881, OR 2,441 AT ANY TIME WITHIN AN 8-MONTH PERIOD.

IN YOUR LETTER OF MAY 13 YOU STATE THAT YOU HAVE BEEN INFORMED THROUGH INDUSTRIAL SOURCES THAT MOLECULAR PRODUCTS INC. RECEIVED IN THE PAST MONTH FROM A GOVERNMENT SOURCE A CONTRACT FOR 22,000 CARTRIDGES WHICH WERE IDENTICAL AND INTERCHANGEABLE WITH THESE DELIVERED BY YOU UNDER THE ABOVE- CITED CONTRACT. IT IS YOUR CONTENTION THAT ANY REQUIREMENTS ARISING DURING THE 8-MONTH PERIOD AFTER YOUR CONTRACT WAS ENTERED INTO MUST BE PROCURED FROM YOU.

CONTRARY TO YOUR CONTENTION, YOUR CONTRACT WAS NOT A "REQUIREMENTS" CONTRACT BUT WAS FOR A DEFINITE QUANTITY. HENCE, THE GOVERNMENT IS NOT OBLIGATED TO PURCHASE ALL ITS REQUIREMENTS FOR CARTRIDGES FROM YOU. WHILE YOUR CONTRACT GAVE THE GOVERNMENT THE OPTION TO ORDER ADDITIONAL QUANTITIES, THAT FACT DOES NOT MAKE IT MANDATORY ON THE GOVERNMENT TO EXERCISE THE OPTION IF ADDITIONAL QUANTITIES ARE NEEDED. IN THAT CONNECTION, SEE ASPR 1-1505 (C) (III) WHICH PROVIDES THAT OPTIONS ARE TO BE EXERCISED ONLY IF THAT IS THE ACTION MOST ADVANTAGEOUS TO THE GOVERNMENT, PRICE AND OTHER FACTORS CONSIDERED. THE DEFENSE SUPPLY AGENCY HAS ADVISED US THAT, SINCE THE DATE OF THE AWARD OF THE CONTRACT TO YOU, IT HAS HAD NO REQUIREMENTS WHICH WOULD CALL EITHER FOR EXERCISE OF THE OPTION OR THE PLACING OF A NEW CONTRACT. MOREOVER, IT IS REPORTED THAT DSA HAS BEEN UNABLE TO IDENTIFY ANY CONTRACT PLACED BY ANY GOVERNMENT ACTIVITY WITH MOLECULAR PRODUCTS INC. FOR THE SAME OR SUBSTANTIALLY SIMILAR CARTRIDGES SINCE THE DATE YOUR CONTRACT WAS ENTERED INTO. MOLECULAR PRODUCTS INC. HAS ADVISED DSA THAT THE ONLY CONTRACT IT CURRENTLY HAS FOR A SIMILAR ITEM IS CONTRACT NO. N00383-68-C-3414 AWARDED ON FEBRUARY 2, 1968, WHICH IS PRIOR TO THE DATE OF YOUR CONTRACT, BY THE UNITED STATES NAVY AVIATION SUPPLY OFFICE, PHILADELPHIA, PENNSYLVANIA.

INASMUCH AS YOU DO NOT HAVE A REQUIREMENTS CONTRACT WITH DSA AND SINCE THERE IS NO RECORD OF ANY CONTRACT HAVING BEEN AWARDED TO MOLECULAR PRODUCTS INC. SINCE THE DATE OF YOUR CONTRACT, YOUR PROTEST IS DENIED.