B-175624, JUN 1, 1972

B-175624, JUN 1, 1972

BID PROTEST - "BRAND NAME OR EQUAL" - IMPROPER PROCUREMENT PROCEDURES CONCERNING THE PROTEST OF PARTICLE DATA, INC; AGAINST AWARD OF A "BRAND NAME OR EQUAL" CONTRACT UNDER AN RFP ISSUED BY THE VETERANS ADMINISTRATION HOSPITAL, WASHINGTON, D.C. THE INVITATION WAS DEFECTIVE BECAUSE (1) FORMAL ADVERTISING WOULD HAVE BEEN MORE FEASIBLE; (2) THE RFP FAILED TO INCLUDE THE LISTING OF SALIENT CHARACTERISTICS REQUIRED BY FPR 1-1.307-4; (3) THE "BRAND NAME OR EQUAL" CLAUSE CONTAINED IN FPR 1-1.307-6 WAS NOT PROPERLY MODIFIED FOR USE IN A NEGOTIATED PROCUREMENT; (4) THE PROCUREMENT FILE DOES NOT CONTAIN THE FORMAL DETERMINATIONS AND FINDINGS REQUIRED BY FPR 1 3.210(B) AND SUBPART 1-3.3. SINCE PERFORMANCE IS VIRTUALLY COMPLETED, THE COMP. GEN. CAN ONLY SUGGEST THAT ACTION BE TAKEN TO PREVENT A FUTURE RECURRENCE OF THESE DISCREPANCIES.

TO MR. DONALD E. JOHNSON:

REFERENCE IS MADE TO THE LETTER OF APRIL 13, 1972, FROM THE DIRECTOR, SUPPLY SERVICE, DEPARTMENT OF MEDICINE AND SURGERY (134C), FORWARDING A REPORT ON THE PROTEST OF PARTICLE DATA, INCORPORATED, AGAINST AWARD OF A CONTRACT UNDER REQUEST FOR PROPOSALS (RFP) 72-65, ISSUED BY THE VETERANS ADMINISTRATION HOSPITAL, WASHINGTON, D.C.

THIS PROCUREMENT, FOR A SINGLE MANOMETER CHANNEL AND A CHANNEL PLOTTER, ORIGINATED WITH THE ISSUANCE OF A FORMALLY ADVERTISED INVITATION, ON A BRAND NAME OR EQUAL BASIS. WHEN NO TIMELY BIDS WERE RECEIVED IN RESPONSE THERETO, THE RFP WAS ISSUED, ALSO ON A BRAND NAME OR EQUAL BASIS. THE PROTESTOR SUBMITTED AN "OR EQUAL" OFFER AT A PRICE OF $8,207.50, WHILE THE BRAND MADE MANUFACTURER, THE ONLY OTHER OFFEROR, OFFERED A PRICE OF $9,174. AFTER OPENING ON MARCH 15, 1972, PARTICLE DATA'S PROPOSAL WAS REFERRED FOR TECHNICAL EVALUATION. THE EVALUATOR, BY MEMORANDUM DATED MARCH 23, 1972, ADVISED THE CONTRACTING OFFICER THAT HE "WOULD PREFER TO PURCHASE THE BRAND NAME COUNTER *** AND WOULD NOT ACCEPT PARTICLE DATA, INCORPORATED'S BID" FOR TECHNICAL REASONS WHICH HE THEN LISTED. AS A RESULT, AWARD WAS MADE TO THE BRAND NAME OFFEROR ON MARCH 24, 1972.

SECTION 1-1.307-4 OF THE FEDERAL PROCUREMENT REGULATIONS (FPR) PROVIDES THAT ALL SOLICITATIONS CONTAINING A "BRAND NAME OR EQUAL" CLAUSE SHOULD SET FORTH THE SALIENT CHARACTERISTICS OF THE BRAND NAME PRODUCT WHICH ARE ESSENTIAL TO THE NEEDS OF THE GOVERNMENT. HOWEVER, THE RFP HEREIN SPECIFIED ONLY A NAMED MANUFACTURER'S MODEL NUMBERS; THERE WAS NO LISTING OF ANY SALIENT CHARACTERISTICS. WE HAVE FREQUENTLY STATED THAT BIDDERS OFFERING "EQUAL" PRODUCTS SHOULD NOT HAVE TO GUESS AT THE DESIRED ESSENTIAL QUALITIES OF THE BRAND NAME ITEM, AND IT IS THE SETTLED RULE IN GOVERNMENT PROCUREMENTS THAT AN INVITATION WHICH FAILS TO LIST ALL ESSENTIAL CHARACTERISTICS IS DEFECTIVE. SEE 49 COMP. GEN. 274 (1969) AND CASES CITED; B-173290, OCTOBER 19, 1971.

THERE ARE CERTAIN OTHER ASPECTS OF THIS PROCUREMENT THAT ALSO WARRANT COMMENT. WE NOTE THAT THE RFP SETS OUT THE BRAND NAME OR EQUAL CLAUSE THAT IS CONTAINED IN FPR 1-1.307-6. THIS CLAUSE IS WRITTEN FOR USE IN FORMALLY ADVERTISED PROCUREMENTS. WHILE FPR 1-1.307-8 AUTHORIZES THE ADOPTION OF THIS CLAUSE FOR USE IN NEGOTIATED PROCUREMENTS, THE CLAUSE MUST BE SUITABLY MODIFIED TO CONFORM TO THE INTENTS AND PURPOSES OF THE NEGOTIATION PROCESS. THUS, PARAGRAPH (C)(3) OF THE CLAUSE STATES THAT:

"MODIFICATIONS PROPOSED AFTER BID OPENING TO MAKE A PRODUCT CONFORM TO A BRAND NAME PRODUCT REFERENCED IN THE INVITATION FOR BIDS WILL NOT BE CONSIDERED."

THE INCLUSION OF SUCH A PROVISION IN AN RFP IS CLEARLY INCONSISTENT WITH THE PRINCIPLE OF ALLOWING MODIFICATIONS IN PROPOSALS IN ACCORDANCE WITH FPR 1-3.805-1(B). 51 COMP. GEN. , B-173522, JANUARY 25, 1972.

WE SEE NOTHING IN THE RECORD, HOWEVER, TO INDICATE THAT ADVERTISING WAS NOT FEASIBLE IN THIS CASE. THE ORIGINAL INVITATION WAS ISSUED ON FEBRUARY 16, 1972, WITH A CLOSING DATE OF MARCH 2, 1972. IT APPEARS THAT THE SYNOPSIS OF THE IFB WAS NOT PUBLISHED IN THE COMMERCE BUSINESS DAILY UNTIL FEBRUARY 28, 1972, AND THAT THE SYNOPSIS INCORRECTLY STATED THAT THE BID OPENING DATE WAS MARCH 3. WHILE NO BIDS WERE RECEIVED BY 10 A.M. ON MARCH 2, THE TIME SET FOR BID OPENING, A BID WAS RECEIVED AT 10:24 A.M. ON MARCH 2, AND TWO OTHER BIDS WERE RECEIVED ON MARCH 6 AND MARCH 10, RESPECTIVELY. IN ADDITION, THE CONTRACTING OFFICER WAS INFORMED VERBALLY AND IN WRITING PRIOR TO MARCH 2 THAT PARTICLE DATA, INCORPORATED, ALTHOUGH NOT ON THE ORIGINAL BIDDER'S LIST, WAS INTERESTED IN BIDDING ON THE SOLICITATION. NEVERTHELESS, THE CONTRACTING OFFICER ISSUED THE RFP ON MARCH 6, 1972, WITH A CLOSING DATE FOR RECEIPT OF PROPOSALS OF MARCH 16, 1972. AS NOTED, THE CONTRACTING OFFICER, IN MAKING AWARD UNDER THE RFP, DID NOT AVAIL HIMSELF OF THE FLEXIBILITY INHERENT IN THE NEGOTIATING PROCESS, BUT GENERALLY ADHERED TO THE PROCEDURES FOLLOWED IN FORMAL ADVERTISING SITUATIONS. WE ALSO NOTE THAT THE PROCUREMENT FILE DOES NOT CONTAIN FORMAL DETERMINATIONS AND FINDINGS REQUIRED BY FPR 1-3.210(B) AND SUBPART 1-3.3.

WE ARE INFORMED THAT PERFORMANCE OF THE CONTRACT IS VIRTUALLY COMPLETED. ACCORDINGLY, IT WOULD NOT BE IN THE BEST INTERESTS OF THE GOVERNMENT TO DISTURB THE CONTRACT AWARD AT THIS TIME. HOWEVER, WE STRONGLY URGE THAT APPROPRIATE ACTION BE TAKEN TO PREVENT A RECURRENCE OF THE DISCREPANCIES DISCUSSED HEREIN IN SUBSEQUENT PROCUREMENTS.

AS REQUESTED, WE ARE RETURNING THE CONTRACT FILE HEREWITH.

A COPY OF THIS LETTER IS BEING SENT TO THE PROTESTANT.