B-164885, MAY 7, 1969

B-164885, MAY 7, 1969

TO MR. SECRETARY:

THIS IS IN REFERENCE TO A REPORT DATED FEBRUARY 28, 1969, FROM THE NAVAL SUPPLY SYSTEMS COMMAND, RELATIVE TO THE RECONSIDERATION OF THE PROTEST BY W.E. SHIPLEY MACHINERY COMPANY AGAINST THE CONTRACT AWARD TO CINCINNATI MILLING AND GRINDING MACHINES, INCORPORATED, UNDER INVITATION FOR BIDS N00600-68-B-0408 ISSUED BY THE NAVY PURCHASING OFFICE.

IN JANUARY 1968 THE NAVY PURCHASING OFFICE ISSUED THE SUBJECT INVITATION CALLING FOR BIDS ON A QUANTITY OF NUMERICALLY CONTROLLED ENGINE LATHES. THE INVITATION SPECIFICATION PROVIDED IN PARAGRAPH 3.2 THAT THE ITEM TO BE FURNISHED SHOULD BE THE MANUFACTURER'S CURRENT COMMERCIAL MODEL. CINCINNATI WAS THE LOW BIDDER, OFFERING TO FURNISH A RECENTLY DEVELOPED COMMERCIAL MODEL WHICH IT PROPOSED TO MODIFY IN SEVERAL RESPECTS IN ORDER TO MEET THE REQUIREMENTS OF THE SPECIFICATION. SHIPLEY, THE SECOND LOW BIDDER, PROTESTED TO NPO THAT THE MODEL OFFERED BY THE LOW BIDDER FAILED TO QUALIFY AS A CURRENT COMMERCIAL MODEL AND, IN ADDITION, WOULD NOT MEET ALL OF THE DESIGN AND PERFORMANCE REQUIREMENTS OF THE SPECIFICATION. NPO, HOWEVER, PROCEEDED TO MAKE AWARD TO THE LOW BIDDER, SATISFYING ITSELF ON THE BASIS OF A PRE-AWARD SURVEY THAT THE BIDDER WOULD BE ABLE TO MAKE THE NECESSARY MODIFICATIONS IN ITS MODEL TO MEET THE SPECIFICATION REQUIREMENTS. SHIPLEY THEN PROTESTED THE AWARD TO OUR OFFICE.

WE DENIED SHIPLEY'S PROTEST ON THE BASIS THAT IT WAS NOT IN THE GOVERNMENT'S INTEREST TO CANCEL THE EXISTING CONTRACT WITH CINCINNATI. THE SAME TIME, WE EXPRESSED OUR DISAPPROVAL OF THE VIEW STATED BY YOUR DEPARTMENT TO THE EFFECT THAT PARAGRAPH 3.2 WAS NOT A MATERIAL REQUIREMENT OF THE SPECIFICATION. IT WAS OUR CONCLUSION THAT THE REQUIREMENT FOR A COMMERCIAL MODEL WENT TO THE MATTER OF RESPONSIVENESS. B-164885, JANUARY 15, 1969.

YOUR DEPARTMENT HAS TAKEN THIS OPPORTUNITY TO REQUEST THAT WE RECONSIDER OUR PRIOR CONCLUSION WITH RESPECT TO THE REQUIREMENT FOR A COMMERCIAL ITEM. IT HAS FURNISHED US WITH A LETTER FROM THE DEFENSE INDUSTRIAL PRODUCTION EQUIPMENT CENTER (DIPEC) CONCERNING THE PHRASE "CURRENT COMMERCIAL MODEL" AS IT WAS EMPLOYED IN PARAGRAPH 3.2 OF THE SPECIFICATION. DIPEC STATES THAT THE PHRASE WAS EMPLOYED IN THE SPECIFICATION IN ACCORDANCE WITH PARAGRAPH VIA OF DOD DIRECTIVE 4120.3 (DEFENSE STANDARIZATION PROGRAM) WHICH PROVIDES THAT "WHEREVER FEASIBLE, MILITARY OPERATIONAL REQUIREMENTS FOR MATERIAL SHALL BE SATISFIED THROUGH THE USE OF EXISTING MILITARY DESIGNS OR COMMERCIAL PRODUCTS.' ENCLOSURE I TO THE DIRECTIVE DEFINES THE TERM "COMMERCIAL PRODUCTS" TO MEAN EQUIPMENT OR SUPPLIES WHICH NORMALLY ARE OR HAVE BEEN SOLD OR OFFERED TO THE PUBLIC COMMERCIALLY BY ANY SUPPLIER. IN ADDITION, DEFENSE STANDARDIZATION MANUAL 4120.3-M STATES THAT MILITARY SPECIFICATIONS INCLUDE COVERAGE OF COMMERCIAL ITEMS MODIFIED TO MEET SPECIAL REQUIREMENTS OF THE MILITARY. DIPEC REPORTS THAT MILITARY SPECIFICATIONS ARE STRUCTURED TO PERMIT THE ACQUISITION OF NONPROTOTYPE INDUSTRIAL PLANT EQUIPMENT ALREADY ON THE MARKET, AND THAT A MODIFIED COMMERCIAL DESIGN, PER SE, IS NOT NECESSARILY INELIGIBLE AS A COMMERCIAL MODEL; IN OTHER WORDS, THERE MAY BE MODIFICATIONS TO A COMMERCIAL MODEL TO MEET SPECIAL REQUIREMENTS OF THE MILITARY. IT IS YOUR DEPARTMENT'S VIEW THAT WHEN A SPECIFICATION CALLS FOR A "CURRENT COMMERCIAL MODEL" OR USES SOME SIMILAR PHRASE WITHOUT DEFINING THE PARAMETERS OF THE REQUIREMENT IN SPECIFIC TERMS, THE MATTER SHOULD BE LEFT IN THE AREA OF RESPONSIBILITY. OUR DECISION AT 39 COMP. GEN. 684 IS CITED BY YOUR DEPARTMENT IN SUPPORT OF THIS VIEW.

WE MUST DISAGREE. THE SPECIFICATION IN THAT CASE CALLED FOR PRODUCT ASSEMBLIES OF A "STANDARD DESIGN" OR A "MODEL PRODUCT OF THE MANUFACTURER CURRENT AT THE TIME OF DELIVERY.' THE INVITATION AND SPECIFICATION ALSO CALLED FOR THE SUBMISSION OF DESCRIPTIVE DATA PRIOR TO AWARD AND FOR THE SUBMISSION OF AN ACCEPTABLE PREPRODUCTION SAMPLE PRIOR TO THE CONTRACT DELIVERY. WE HELD THAT THIS INVITATION DID NOT RESTRICT THE BIDDING TO ESTABLISHED MANUFACTURERS ONLY, BUT RATHER ALL RESPONSIBLE BIDDERS WERE ELIGIBLE FOR THE AWARD. WE SPECIFICALLY NOTED THAT THE REQUIREMENT FOR STANDARD DESIGN OR MODEL RELATED TO THE TIME OF DELIVERY. THIS IS INCONSISTENT WITH A MATTER OF RESPONSIVENESS WHICH MUST BE APPLICABLE AS OF THE TIME OF BID OPENING. IN THE CASE HERE AT ISSUE THE LANGUAGE OF PARAGRAPH 3.2, WHILE NOT ENTIRELY CLEAR, MAY READILY BE UNDERSTOOD TO APPLY AS OF BID OPENING.

THE INSTANT INVITATION CALLED FOR NEITHER DESCRIPTIVE DATA NOR FORA PRE- PRODUCTION SAMPLE; THERE WAS ONLY THE REQUIREMENT IN PARAGRAPH 3.2 FOR A "CURRENT COMMERCIAL MODEL.' WE AGREE THAT THE PHRASE "CURRENT COMMERCIAL MODEL," STANDING ALONE, IS SOMEWHAT VAGUE AND LACKS SPECIFICITY. WE HAD UNDERSTOOD FROM SHIPLEY THAT THIS PHRASE WAS EMPLOYED IN PARAGRAPH 3.2 TO REQUIRE A MODEL WHICH HAD BEEN COMMERCIALLY AVAILABLE AND PROVEN FOR PRODUCTION FOR AT LEAST ITS WARRANTY PERIOD. ALTHOUGH DIPEC STATES THAT IT DOES NOT CONCUR IN THIS DEFINITION, WE ARE NOT SURE THE DEFINITION GIVEN BY DIPEC IS SIGNIFICANTLY DIFFERENT. EVEN UNDER THE DIPEC INTERPRETATION IT APPEARS THAT A PROTOTYPE MODEL WOULD NOT QUALIFY AS A "CURRENT COMMERCIAL MODEL" (ALTHOUGH WE REALIZE THAT IT MAY BE DIFFICULT AT TIMES TO DISTINGUISH BETWEEN A PROTOTYPE MODEL AND A MODIFIED COMMERCIAL MODEL). A BIDDER READING PARAGRAPH 3.2 WOULD REASONABLY CONCLUDE THAT HE COULD NOT OFFER A PROTOTYPE MODEL. FOR THIS REASON WE ARE UNABLE TO CONCUR IN YOUR DEPARTMENT'S INTERPRETATION OF THAT SPECIFICATION PARAGRAPH. IN FUTURE INVITATIONS UNDER THIS SPECIFICATION WE RECOMMEND THAT THE REQUIREMENT FOR A "CURRENT COMMERCIAL MODEL" BE DELETED ENTIRELY FROM THE SPECIFICATION OR ELSE BE MORE FULLY EXPLAINED IN THE INVITATION FOR BIDS.

ENCLOSED IS A COPY OF OUR LETTER OF TODAY TO SHIPLEY AFFIRMING OUR PRIOR DENIAL OF ITS PROTEST.