B-173345, OCT 26, 1971, 51 COMP GEN 237

B-173345, OCT 26, 1971, 51 COMP GEN 237

CONTRACTS - SPECIFICATION - RESTRICTIVE - PARTICULAR MAKE - "OR EQUAL" PRODUCT ACCEPTABILITY THE REJECTION OF THE LOW BID FOR THE PROCUREMENT OF AN ELECTRIC GENERATING SET ON THE BASIS OF THE SECOND LOW BIDDER'S ALLEGATION OF NONCONFORMITY WITH THE PARTICULAR FEATURES OF THE BRAND NAME OR EQUAL PURCHASE DESCRIPTION WAS CORRECT, EVEN THOUGH BEFORE REJECTION THE ALLEGATIONS SHOULD HAVE BEEN INVESTIGATED AND THE LOW BIDDER GIVEN AN OPPORTUNITY TO ANSWER THE ALLEGATIONS IN ORDER NOT TO ADVERSELY AFFECT THE INTEGRITY OF THE COMPETITIVE SYSTEM. HOWEVER, THE INVITATION WAS DEFECTIVE FOR ACCORDING TO A UNITED STATES GENERAL ACCOUNTING OFFICE ENGINEER THE LOW BID WAS IN CONFORMANCE WITH THE SPECIFICATIONS ON AN "OR EQUAL" BASIS AND, THEREFORE, THE PARTICULAR FEATURES LISTED IN THE INVITATION OVERSTATED THE GOVERNMENT'S NEEDS AND RESTRICTED COMPETITION. WHERE NEEDS CAN BE STATED WITH PRECISE SPECIFICITY, PROCUREMENTS SHOULD BE EFFECTED UNDER PURCHASE DESCRIPTIONS AND NOT UNDER THE "BRAND NAME OR EQUAL" TECHNIQUE.

TO THE SECRETARY OF THE NAVY, OCTOBER 26, 1971:

WE REFER TO LETTERS SUP 0222 DATED JULY 21 AND AUGUST 12, 1971, WITH ENCLOSURES, FROM THE DEPUTY COMMANDER, PROCUREMENT MANAGEMENT, NAVAL SUPPLY SYSTEMS COMMAND, REPORTING ON THE PROTEST OF SWEINHART ELECTRIC CO. INC. AGAINST THE AWARD OF A CONTRACT TO CAL-WEST ELECTRIC, INC., FOR AN ELECTRIC GENERATING SET, UNDER INVITATION FOR BIDS (IFB) NO. N66314-71-B- 2516, ISSUED BY THE NAVAL REGIONAL PROCUREMENT OFFICE (NRPO), NAVAL SUPPLY CENTER, OAKLAND, CALIFORNIA.

NRPO HAS ADVISED THAT THE ELECTRIC GENERATING SET WAS SCHEDULED FOR DELIVERY TO THE USING ACTIVITY BY CAL-WEST ON AUGUST 20, 1971. THEREFORE, OUR ACTION IS CONFINED TO MAKING RECOMMENDATIONS TO PRECLUDE RECURRENCE OF THE PROCUREMENT DEFICIENCIES NOTED HEREIN.

THE IFB SOLICITED BIDS FOR ONE "ELECTRIC GENERATING SET, DIESEL DRIVEN, RADIATOR COOLED, ONAN MODEL 300 DFT-4R OR EQUAL," IN ACCORDANCE WITH "DESCRIPTION/SPECIFICATIONS," WHICH IN SECTION F1 REQUIRED THAT THE SET GENERATE 300 KILOWATTS (KW.). ALSO, SECTION F2, ENTITLED "DIESEL ENGINES," SPECIFIED:

TYPE: 4-CYCLE; V-12 CYLINDER; 5.5-IN BORE; 6-IN STROKE; 1710-CU IN PISTON DISPLACEMENT; 15.1 TO 1 COMPRESSION RATIO; PISTON SPEED 1800 FPM; 463-BHP MAXIMUM AT 1800-RPM. CUMMINS ENGINE, V1710P500 OR EQUAL.

SECTION C9 OF THE IFB CONTAINED THE BRAND NAME OR EQUAL CLAUSE REQUIRED BY THE PROVISIONS OF PARAGRAPH 1-1206.3(B) OF THE ARMED SERVICES PROCUREMENT REGULATION (ASPR). THE CLAUSE ADVISED BIDDERS THAT THE ITEMS CALLED FOR BY THE IFB HAVE BEEN IDENTIFIED BY A BRAND NAME OR EQUAL DESCRIPTION WHICH WAS INTENDED TO BE DESCRIPTIVE RATHER THAN RESTRICTIVE AND INDICATIVE OF THE QUALITY AND CHARACTERISTICS OF PRODUCTS THAT WOULD BE SATISFACTORY. THE CLAUSE FURTHER PROVIDED THAT BIDS OFFERING EQUAL PRODUCTS WERE TO BE CONSIDERED FOR AWARD IF SUCH PRODUCTS WERE EQUAL "IN ALL MATERIAL RESPECTS" TO THE REFERENCED BRAND NAME.

THE JUNE 8, 1971, BID OPENING ESTABLISHED SWEINHART AS THE LOW BIDDER. HOWEVER, BY LETTER DATED JUNE 9, 1971, THE SECOND LOW BIDDER, CAL-WEST, ADVISED NRPO THAT THE SWEINHART BID STATED EXCEPTIONS TO THE SPECIFICATIONS IN THE IFB. AMONG OTHERS, CAL-WEST POINTED OUT THAT THE CATERPILLAR ENGINE OFFERED BY SWEINHART WAS 6-CYLINDER RATHER THAN 12 CYLINDER AS PROVIDED IN THE SPECIFICATIONS. ALSO, CAL-WEST STATED THAT THE ELECTRIC GENERATING SET WITH THE CATERPILLAR ENGINE MODEL PROPOSED BY SWEINHART WAS ONLY RATED TO PRODUCE A MAXIMUM OF 250-KW. STANDBY POWER ACCORDING TO PUBLISHED LITERATURE, AS OPPOSED TO THE 300-KW. REQUIREMENT IN THE IFB. IT IS REPORTED THAT:

*** AFTER FURTHER REVIEW, THE BID OF SWEINHART ELECTRIC COMPANY WAS REJECTED AS NONRESPONSIVE DUE TO FAILURE TO MEET ENGINE TYPE REQUIREMENTS AND ON 15 JUNE 1971 AWARD WAS MADE TO CAL-WEST ELECTRIC, INCORPORATED.

INITIALLY, WE NOTE THE CIRCUMSTANCES UNDER WHICH SWEINHART'S BID WAS ORIGINALLY REJECTED. APPARENTLY, THE PROCUREMENT ACTIVITY ACCEPTED THE ALLEGATIONS OF THE SECOND LOW BIDDER CONCERNING THE ALLEGED NONRESPONSIVENESS OF THE LOW BIDDER WITHOUT INVESTIGATION AND WITHOUT AFFORDING THE LOW BIDDER AN OPPORTUNITY TO ANSWER THE ALLEGATION. BELIEVE THAT THIS OCCURRENCE ADVERSELY AFFECTED THE INTEGRITY OF THE COMPETITIVE BIDDING SYSTEM AND WE SUGGEST THAT STEPS BE TAKEN TO AVOID FUTURE SITUATIONS.

THE SUBSTANCE OF THE SWEINHART PROTEST DEALS WITH THE CONTENTION THAT THE 6-CYLINDER CATERPILLAR ENGINE IS EQUAL IN ALL MATERIAL RESPECTS TO THE 12- CYLINDER BRAND NAME ENGINE PRESCRIBED BY THE IFB. IN THAT CONNECTION, THE JULY 21 ADMINISTRATIVE REPORT STATED THAT THE TWO PRIMARY TECHNICAL BASES UPON WHICH THE SWEINHART BID WAS REJECTED AS NONRESPONSIVE WERE INSUFFICIENT KILOWATT OUTPUT AND NUMBER OF CYLINDERS IN THE PROPOSED ENGINE. IN ADDITION, THE REPORT ADVISED THAT, OF THE REMAINING EIGHT BIDDERS (EXCLUDING SWEINHART AND CAL-WEST), FIVE OFFERED 12-CYLINDER ENGINES, EACH MANUFACTURED BY A FIRM OTHER THAN THE BRAND NAME COMPANY - A FACT CLEARLY INDICATING THAT THE SPECIFICATIONS WERE NOT RESTRICTIVE.

THE SUPPLEMENTAL REPORT OF AUGUST 12, PREPARED IN RESPONSE TO VARIOUS INQUIRIES BY OUR OFFICE, INTER ALIA, CONCEDED, CONTRARY TO THE INITIAL REPORT, "THAT THE ENGINE OFFERED BY SWEINHART WILL PRODUCE 300 KW OF POWER." THUS, ONE OF THE TWO BASES THAT NRPO RELIED UPON FOR REJECTING THE SWEINHART BID ADMITTEDLY WAS ERRONEOUS. ALSO, THE REPORT STATED THAT THE CUBIC INCH PISTON DISPLACEMENT AND PISTON SPEED CRITERIA, IN ADDITION TO THE 12-CYLINDER REQUIREMENT TO WHICH SWEINHART DID NOT CONFORM, WERE CONSIDERED TO BE SALIENT CHARACTERISTICS. FURTHER, IT WAS STATED THAT THE INITIAL REPORT WAS "ERRONEOUS IN STATING THAT FIVE BIDDERS OFFERED TWELVE CYLINDER ENGINES OTHER THAN CUMMINS (THE BRAND NAME)." IN FACT, THE REPORT STATES THAT ONLY ONE OTHER BIDDER WHO OFFERED OTHER THAN THE BRAND NAME WAS RESPONSIVE. HOWEVER, OTHER INFORMATION FURNISHED IN THE REPORT INDICATES THAT THE BIDDER WAS NONRESPONSIVE AT LEAST TO THE CUBIC INCH PISTON DISPLACEMENT REQUIREMENT.

THE DESCRIPTION/SPECIFICATION IN THE IFB IS ALMOST A VERBATIM COPY OF THE DESIGN AND PERFORMANCE CRITERIA IN THE TECHNICAL LITERATURE ON THE BRAND NAME ARTICLE. THE EFFECT OF THIS IS TO MAKE EACH AND EVERY FEATURE LISTED IN THE DESCRIPTION A SALIENT FEATURE OF THE BRAND NAME. WHERE, AS HERE, THE CONTRACTING AGENCY, IN A "BRAND NAME OR EQUAL" PURCHASE DESCRIPTION, GOES BEYOND THE MAKE AND MODEL OF THE BRAND NAME AND SPECIFIES PARTICULAR FEATURES, WE HAVE HELD THAT SUCH FEATURES MUST BE PRESUMED TO HAVE BEEN REGARDED AS MATERIAL AND ESSENTIAL TO THE NEEDS OF THE GOVERNMENT. COMP. GEN. 195, 199 (1969). IN THIS CASE, NRPO'S PURCHASE DESCRIPTION REPRESENTED AN UNQUALIFIED ADMINISTRATIVE DETERMINATION THAT CERTAIN PARTICULAR FEATURES WERE MATERIAL AND ESSENTIAL TO THE NEEDS OF THE GOVERNMENT. SINCE THE EQUIPMENT OFFERED IN THE SWEINHART BID DID NOT CONFORM TO THESE FEATURES SPECIFIED TO BE MATERIAL AND ESSENTIAL, IT WAS NOT EQUAL IN ALL MATERIAL RESPECTS AND THE ACCEPTANCE OF THAT BID COULD NOT HAVE BEEN ACCOMPLISHED WITHOUT A WAIVER OF THE ADVERTISED SPECIFICATIONS. THEREFORE, SINCE THIS ACTION WOULD HAVE BEEN IMPROPER, WE ARE OF THE OPINION THAT THE CONTRACTING OFFICER'S DECISION THAT THE SWEINHART BID WAS NONRESPONSIVE TO THE SOLICITATION WAS CORRECT. SEE 49 COMP. GEN., SUPRA; 48 ID. 441, 446 (1968); 44 ID. 302, 305 (1964); AND 43 ID. 761, 766 (1964).

HOWEVER, WE NOTE THAT THE SWEINHART BID WAS NONRESPONSIVE TO SEVERAL OTHER REQUIREMENTS, IN THAT, FOR EXAMPLE, IT OFFERED AN 11.5-GALLON OIL CAPACITY WHEREAS THE SPECIFICATIONS PROVIDED AN OIL CAPACITY OF 18 GALLONS PLUS 3 GALLONS FOR FILTERS. NRPO APPEARED TO DISREGARD THESE DEVIATIONS FROM THE SPECIFICATIONS, RELYING ON THE FOLLOWING RATIONALE:

*** AS IS CUSTOMARY IN ALL BRAND NAME OR EQUAL SOLICITATIONS, THE VALUES EXPRESSED ARE NOMINAL AND REASONABLE VARIANCES FROM THEM WOULD HAVE BEEN ACCEPTABLE. ***

THIS RATIONALE CLEARLY INDICATES THAT SOME OF THE SPECIFICATION REQUIREMENTS WERE NOT MATERIAL AND ESSENTIAL TO THE NEEDS OF THE GOVERNMENT. FURTHER, WE NOTE THE MARKED SHIFT OF EMPHASIS IN THE SUPPLEMENTAL REPORT CONCERNING THE TECHNICAL BASES FOR THE REJECTION OF SWEINHART'S BID. THAT REPORT INTRODUCES A TECHNICAL FACTOR NOMINATED AS ENGINE RELIABILITY BASED ON MINIMUM LEVELS OF CUBIC INCH PISTON DISPLACEMENT AND PISTON SPEED INTO THE EVALUATION PROCESS. THE REPORT STATED THAT THE USING ACTIVITY VALIDATED ITS RELIABILITY REQUIREMENT AND THAT A RECOGNIZED MECHANICAL ENGINEER IS OF THE OPINION THAT THE USING ACTIVITY WOULD BE FORTUNATE TO OBTAIN 1,000 HOURS OF INTERMITTENT OPERATION FROM THE ENGINE OFFERED BY SWEINHART AT 300 KW.

THESE STATEMENTS CONSTITUTE NOTHING MORE THAN AN AFTER-THE-FACT ATTEMPT TO RATIONALIZE A PREVIOUSLY STATED OPINION WHICH NRPO HAS NEVER SEEMED TO REGARD AS A REASONABLY RELIABLE TECHNICAL BASIS FOR UTILIZATION IN THE DETAILED SPECIFICATIONS IN THE IFB. IT APPEARS TO US THAT NRPO NEVER MADE A REASONED PRESOLICITATION DETERMINATION OF WHAT SALIENT CHARACTERISTICS CONSTITUTED THE ACTUAL ESSENTIAL NEEDS OF THE GOVERNMENT. THE REPORTS CONTAIN NO EMPIRICAL EVIDENCE IN SUPPORT OF THE PROPOSITION THAT THE CATERPILLAR ENGINE CANNOT PERFORM AS RELIABLY AS THE BRAND NAME. THIS FACT, ALONE, WOULD APPEAR TO RAISE A QUESTION AS TO THE APPROPRIATENESS OF SPECIFYING A 12-CYLINDER ENGINE AS A REQUIREMENT. SEE 49 COMP. GEN., SUPRA. IN THE ABSENCE OF SUCH EVIDENCE AND IN VIEW OF THE ADMITTED CAPABILITY OF THAT ENGINE TO PRODUCE THE REQUIRED KILOWATT OUTPUT TO PERFORM AS AN ACCEPTABLE POWER SOURCE, WE REQUESTED AN ENGINEER IN OUR OFFICE TO REVIEW THE SWEINHART AND NRPO TECHNICAL ARGUMENTS IN SUPPORT OF THEIR RESPECTIVE POSITIONS. THE ENGINEER CONCLUDED:

I CONCUR WITH SWEINHART'S CONTENTION THAT THE CATERPILLAR DIESEL ENGINE - MODEL D343 TA - WHICH THEY OFFERED IS IN CONFORMANCE ON AN "OR EQUAL" BASIS WITH THE SPECIFICATIONS OF THE IFB.

IN MY OPINION, THE CONTRACTING OFFICER (CO) WAS INCORRECT IN HIS CONCLUSION THAT THE SIX CYLINDER CATERPILLAR ENGINE IS NOT RESPONSIVE BECAUSE IT IS LESS RELIABLE THAN THE 12 CYLINDER CUMMINS ENGINE. THE CO USES BRAKE MEAN EFFECTIVE PRESSURE (BMEP), AND PISTON TRAVEL TO ILLUSTRATE AND COMPARE ENGINE RELIABILITY. I DISAGREE WITH THE CONTRACTING OFFICER'S CONCLUSION BECAUSE:

1. BMEP BY ITSELF CANNOT BE USED TO JUDGE ENGINE RELIABILITY. IF A COMPARISON IS TO BE MADE, ALL ENGINE DESIGN FACTORS MUST BE CONSIDERED (ENGINE STRENGTH, DESIGN HISTORY, TYPE OF ASPIRATION, ETC.)

2. THE AMOUNT OF PISTON TRAVEL DOES NOT INDICATE HOW MUCH WEAR ON ENGINE EXPERIENCES PISTON TRAVEL CANNOT BE USED BY ITSELF TO COMPARE THE RELIABILITY OF ENGINES BECAUSE DESIGN CONSIDERATIONS LIKE THE NUMBER OF PISTON RINGS MUST ALSO BE CONSIDERED.

3. THERE ARE MORE MOVING PARTS IN A 12 CYLINDER ENGINE THAN THERE ARE IN A SIX CYLINDER ENGINE. THEREFORE, THE PROBABILITY OF FAILURE FOR THE 12 CYLINDER ENGINE IS GREATER.

4. THE MEAN TIME BETWEEN OVERHAUL (MTBO) IS ONE INDICATOR OF HOW LONG AN ENGINE WILL SATISFACTORILY OPERATE BEFORE IT NEEDS AN OVERHAUL. CONTACTED TECHNICAL REPRESENTATIVES FROM CUMMINS AND CATERPILLAR CONCERNING THE TWO ENGINES IN QUESTION. I WAS ADVISED THAT FOR THE SAME LOAD (300KW) AND UNDER THE SAME CONDITIONS OF INTERMITTENT USAGE THE MTBO'S FOR THE ENGINES WERE NEARLY EQUAL.

CUMMINS MTBO - AT LEAST TEN THOUSAND HOURS. CATERPILLAR MTBO - EIGHT TO TEN THOUSAND HOURS.

IN 45 COMP. GEN. 462, 466 (1966), WE DISCUSSED THE BASIC PRINCIPLES UNDER THE REGULATIONS GOVERNING "BRAND NAME OR EQUAL" PROCUREMENTS IN ASPR 1- 1206.1, ET SEQ., AS FOLLOWS:

ESSENTIALLY, THE "OR EQUAL" PROVISION IN AN ADVERTISED PURCHASE DESCRIPTION IS FOR THE PURPOSE OF MAXIMIZING AND EQUALIZING COMPETITION WHERE ORDINARILY NONE WOULD EXIST DUE TO THE GOVERNMENT'S NEEDS FOR THE PARTICULAR ESSENTIAL CHARACTERISTICS OF A PRODUCT OF ONE MANUFACTURER. THROUGH THE DEVICE OF "BRAND NAME OR EQUAL," RESPONSIVE BIDS MAY BE SUBMITTED BY THOSE FIRMS WHICH OFFER THEIR COMMERCIAL PRODUCTS WHICH, IN THEIR OPINIONS, ARE EQUAL IN ALL MATERIAL RESPECTS TO THE BRAND NAME PRODUCT REFERENCED. THE REGULATIONS, QUOTED ABOVE, WHEN DEALING WITH THE VARIOUS ASPECTS OF "BRAND NAME OR EQUAL" PROCUREMENTS, SPEAK GENERALLY OF THE ACCEPTABILITY OF "EQUAL" PRODUCTS IF THEY MEET THE NEEDS OF THE GOVERNMENT IN "ESSENTIALLY THE SAME MANNER AS THOSE REFERENCED"; IF DETERMINED "TO BE EQUAL IN ALL MATERIAL RESPECTS TO THE BRAND NAME"; AND THAT "EQUAL" BIDS SHALL NOT BE REJECTED BECAUSE OF "MINOR DIFFERENCES IN DESIGN, CONSTRUCTION, OR FEATURES WHICH DO NOT AFFECT THE SUITABILITY OF THE PRODUCTS FOR THEIR INTENDED USE." THE FOREGOING STRONGLY SUGGESTS THAT THE OVERRIDING CONSIDERATION IN DETERMINING EQUALITY OR SIMILARITY OF ANOTHER COMMERCIAL PRODUCT TO A NAME BRAND COMMERCIAL PRODUCT IS WHETHER ITS PERFORMANCE CAPABILITIES CAN BE REASONABLY EQUATED TO THE BRAND NAME REFERENCED. IN OTHER WORDS, WHETHER THE EQUAL PRODUCT CAN DO THE SAME JOB IN A LIKE MANNER AND WITH THE DESIRED RESULTS SHOULD BE THE DETERMINATIVE CRITERIA RATHER THAN WHETHER CERTAIN FEATURES OF DESIGN OF THE BRAND NAME ARE ALSO PRESENT IN THE "EQUAL" PRODUCT. WE RECOGNIZE OF COURSE, THAT THE GOVERNMENT IS NOT REQUIRED TO PURCHASE AN "EQUAL" PRODUCT IF IT BE DETERMINED THAT SUCH PRODUCT WILL NOT MEET THE GOVERNMENT'S ADVERTISED REQUIREMENTS. HOWEVER, WE FEEL THAT A SPECIFICATION - SUCH AS IS EXEMPLIFIED BY THE TECHNICAL EXHIBIT - WHICH REQUIRES THE USE OF CERTAIN BRAND NAME DESIGN CHARACTERISTICS IS SO RESTRICTIVE AS TO PREVENT THE COMPETITION REQUIRED UNDER ADVERTISED PROCEDURES. *** "

ACCORDINGLY, WE CONCLUDE THAT THE IFB WAS DEFECTIVE AS RESTRICTIVE OF COMPETITION FOR LISTING CHARACTERISTICS WHICH WERE NOT ESSENTIAL AND MATERIAL TO THE NEEDS OF THE GOVERNMENT. SEE B-157857, JANUARY 26, 1966; 45 COMP. GEN., SUPRA; AND 49 ID. 347, 350 (1969). IT IS OUR OPINION THAT HAD THE IFB PURCHASE DESCRIPTION CONTAINED ONLY THOSE SALIENT CHARACTERISTICS AFFECTING PERFORMANCE WHICH WERE ESSENTIAL TO THE NEEDS OF THE GOVERNMENT, THE SWEINHART BID MIGHT VERY WELL HAVE BEEN RESPONSIVE. THEREFORE, THE IFB NEITHER PERMITTED NOR WAS CONDUCIVE TO THE FULL, FREE AND UNRESTRICTED SUBMISSION OF COMPETITIVE BIDS OFFERING COMPARABLE EQUIPMENT WHICH, IN ALL MATERIAL RESPECTS AFFECTING PERFORMANCE, MET THE NEEDS OF THE GOVERNMENT AS REQUIRED BY 10 U.S.C. 2305(B). SEE 45 COMP. GEN., SUPRA. IN THIS REGARD, WE NOTE AGAIN THAT THE ONLY BIDDER OFFERING OTHER THAN THE BRAND NAME ENGINE WHO WAS CONSIDERED TO BE RESPONSIVE BY NRPO WAS IN FACT NONRESPONSIVE. ALSO, DUE TO THE FACT THAT REASONABLE TOLERANCES WITH RESPECT TO VARIOUS PHYSICAL AND FUNCTIONAL CHARACTERISTICS OF THE DESIRED GENERATING SET WERE GENERALLY ACCEPTABLE TO NRPO, THE SALIENT CHARACTERISTICS IN THE PURCHASE DESCRIPTION SHOULD HAVE SO STATED. SEE 48 COMP. GEN., SUPRA. IN THE ALTERNATIVE, WE BELIEVE THAT, SINCE NRPO SET FORTH ITS NEEDS WITH SUCH PRECISE SPECIFICITY, FUTURE PROCUREMENTS OF THIS ITEM SHOULD BE EFFECTED UNDER PURCHASE DESCRIPTIONS AND NOT UNDER THE "BRAND NAME OR EQUAL" TECHNIQUE. SEE 49 COMP. GEN. 347, 352 (1969).

WE EXPECT THAT APPROPRIATE STEPS WILL BE TAKEN TO PRECLUDE RECURRENCE OF THE CIRCUMSTANCES WHICH GAVE RISE TO THE PROTEST.