B-168524, JAN. 20, 1970

B-168524, JAN. 20, 1970

BID PROTEST--BUY AMERICAN ACT--SPECIFICATION CONFORMABILITY DECISION TO CERVITOR KITCHENS, INC; DENYING PROTEST AWARD TO SEARS, ROEBUCK AND CO; LOW BIDDER, FOR FURNISHING REFRIGERATION TO NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA. A BID OFFERING A FOREIGN-MADE PRODUCT WHICH WAS EVALUATED ON THE BASIS OF THE 50 PERCENT FACTOR PURSUANT TO THE BUY AMERICAN ACT AND INCLUDING THE 12 PERCENT FACTOR BASED ON THE PROTESTANT'S SMALL BUSINESS STATUS WAS PROPERLY EVALUATED AND SINCE SUCH LOW BIDDER DID NOT TAKE ANY EXCEPTION TO SPECIFICATIONS AND GOVERNMENT IS PROTECTED IN ITS RIGHT TO OBTAIN A PRODUCT ADHERING TO THE SPECIFICATIONS, PROTEST MUST BE DENIED.

TO CERVITOR KITCHENS, INCORPORATED:

REFERENCE IS MADE TO YOUR TELEGRAM OF DECEMBER 1, 1969, PROTESTING THE AWARD OF A CONTRACT TO SEARS ROEBUCK AND COMPANY (SEARS) UNDER INVITATION FOR BIDS NO. N66314-70-B-2619, ISSUED BY THE NAVAL REGIONAL PROCUREMENT OFFICE, NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA.

THE SUBJECT INVITATION, ISSUED ON OCTOBER 13, 1969, CALLED FOR BIDS ON 112 HOUSEHOLD REFRIGERATORS WITH A 4 CUBIC FOOT CAPACITY IN ACCORDANCE WITH NAVY SPECIFICATION CBC-PD-4110-2, AND TOTAL COST WAS ESTIMATED TO BE $11,200.00. INVITATIONS WERE MAILED TO 21 FIRMS AND BIDS WERE OPENED ON OCTOBER 27, 1969, WITH TWO BIDS RECEIVED INCLUDING ONE FROM SEARS WHO WAS THE LOW BIDDER AT A PRICE OF $8,680.00. YOUR BID WAS $17,472.00. THE BID OF SEARS OFFERED A FOREIGN-MADE PRODUCT AND WAS THEREFORE EVALUATED UNDER THE BUY AMERICAN ACT, 41 U.S.C. 10A, ET SEQ; PROCEDURES IN ACCORDANCE WITH THE ARMED SERVICES PROCUREMENT REGULATION (ASPR) 6-104.4. PURSUANT TO ASPR 6-104.4 (B), THE LOW BID OF SEARS WAS EVALUATED BY APPLICATION FIRST OF THE 12 PERCENT FACTOR, BASED ON YOUR STATUS AS A SMALL BUSINESS, WHICH IS INCLUSIVE OF DUTY, AND THIS PRODUCED A PRICE OF $9,721.60, AND THEN BY APPLICATION OF THE 50 PERCENT FACTOR WHICH IS EXCLUSIVE OF DUTY AND THIS PRODUCED A PRICE OF $12,482.40.

SINCE THE USE OF THE 50 PERCENT FACTOR RESULTED IN A GREATER EVALUATED PRICE, THIS PRICE WAS USED AS SEARS' BID, HOWEVER, EVEN WITH APPLICATION OF THIS 50 PERCENT FACTOR THE BID OF SEARS REMAINED THE LOWEST BID. ACCORDINGLY, THE CONTRACT WAS AWARDED TO SEARS ON OCTOBER 30, 1969, BY MAILING A PRELIMINARY NOTICE OF AWARD. BY TELEGRAM OF DECEMBER 1, 1969, YOU PROTESTED TO THIS OFFICE AGAINST AWARD TO SEARS, "SINCE WE BELIEVE THEIR FOREIGN MADE UNIT DOES NOT MEET TECHNICAL SPECIFICATIONS CBC-PD-4110 -2, PAR. 3.4.1. AND 3.6.1.1."

THE BID SUBMITTED BY SEARS TOOK NO EXCEPTION TO THE SPECIFICATIONS, AND SEARS IS THEREFORE LEGALLY BOUND TO FURNISH REFRIGERATORS CONFORMING TO THE SPECIFICATIONS. THE GOVERNMENT HAS ADEQUATE REMEDY UNDER THE STANDARD SUPPLY CONTRACT "INSPECTION" CLAUSE WHICH IS INCORPORATED BY REFERENCE INTO THE CONTRACT WITH SEARS AND WHICH PROVIDES FOR INSPECTION AND TEST BY THE GOVERNMENT, AND FOR CORRECTION OR REPLACEMENT OF ANY NON-CONFORMING ITEMS WHICH MAY BE DELIVERED. IN THIS CONNECTION, ON DECEMBER 2, 1969, YOU WERE INFORMED BY LETTER FROM THE NAVAL REGIONAL PROCUREMENT OFFICE, OAKLAND, CALIFORNIA, THAT THE GOVERNMENT WOULD MAKE SURE THAT THE PRODUCT SUPPLIED BY SEARS CONFORMED TO THE SPECIFICATIONS. WE ARE FURTHER ADVISED THAT THE ADMINISTRATIVE CONTRACTING OFFICER, DEFENSE CONTRACT ADMINISTRATION SERVICE REGION, SAN FRANCISCO, WAS REQUESTED BY LETTER OF DECEMBER 2, 1969, FROM THE NAVAL REGIONAL PROCUREMENT OFFICE TO INSURE THAT THE PRODUCT ADHERES TO SPECIFICATIONS, AND TO ADVISE THE REGIONAL OFFICE OF THE INSPECTION RESULTS. IT WOULD THEREFORE APPEAR THAT THE GOVERNMENT'S INTEREST IN THIS REGARD SHOULD BE ADEQUATELY PROTECTED.

FOR THE ABOVE REASONS, WE FIND NO LEGAL BASIS TO QUESTION THE AWARD TO SEARS, AND YOUR PROTEST IS THEREFORE DENIED.