Bid Protests:

Characteristics of Cases Filed in Federal Courts

GGD/OGC-00-72: Published: Apr 17, 2000. Publicly Released: Apr 17, 2000.

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Laurie E. Ekstrand
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Pursuant to a legislative requirement, GAO provided information on small business bid protests that have been filed in district courts and the United States Court of Federal Claims (COFC) since the Administration Dispute Resolution Act took effect on December 31, 1996, focusing on the: (1) number of bid protest cases filed in the U.S. district courts and COFC between January 1, 1997, and April 30, 1999, that were filed by small businesses, the type of agencies involved, and the amount of the procurement at issue; (2) perceived advantages and disadvantages for small businesses filing bid protest cases in each judicial forum; and (3) characteristics of district court and COFC bid protest cases, particularly those filed by small businesses, that could be used to assess these perceived advantages and disadvantages.

GAO noted that: (1) between January 1, 1997, and April 30, 1999, at least 66 bid protest cases were filed in U.S. district courts; (2) during the period January 1, 1997, through August 1, 1999, 118 bid protest cases were filed in COFC; (3) on the basis of available data, using an inclusive definition of small business, GAO found about half of the cases in both district courts and COFC were filed by small businesses; (4) defense procurements were the subject of the majority of small business protests in both district courts and COFC; (5) for those cases for which the value of the procurement was available, the majority of the small business procurements in district courts and COFC were for $10 million or less; (6) the case data available provide a limited basis for assessing the perceived advantages and disadvantages of retaining district court jurisdiction for bid protest cases, therefore, GAO draws no conclusions based on these data; (7) proponents of retaining district court jurisdiction assert that small businesses may be able to reduce the costs of filing a protest case in federal court by filing in their local district court using counsel from those local districts; (8) requiring small businesses to file all their judicial protest cases with COFC could raise their protest costs, perhaps prohibitively; (9) GAO found that more small businesses filed in COFC than filed in district courts; (10) of the 33 small business cases filed in district courts, 18 were filed in the protesters' local district courts; (11) with regard to potential jurisdictional issues associated with bid protest cases, GAO found that the legal issues raised in the bid protest cases filed in district courts and COFC fell into the same general categories; (12) in both forums, the issue raised most frequently was the propriety of agency evaluation of proposals; (13) in both district courts and COFC, the results of bid protests were mixed; (14) it was not clear that small businesses were more likely to prevail in district courts than COFC; (15) the courts usually denied injunctive relief to protesters regardless of whether they were small businesses or not; (16) in 30 district court cases and 29 COFC cases, the courts dismissed the cases on the voluntary motion of the protester or the protester and government jointly; (17) in some cases the voluntary dismissal was because the parties had reached a settlement that responded to the protester's claims; and (18) in actions other than granting motions for voluntary dismissal, the courts generally ruled against the protester, with only one district court ruling in the protester's favor.

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