How an Offeror’s Attempt to Avoid a Formal Bid Protest Can Backfire
In a recent bid protest decision, Coulson Aviation (USA), Inc., the Government Accountability Office (“GAO”) injected uncertainty regarding informal communications between a prospective offeror and the agency expressing concern about a solicitation provision. Unfortunately, this decision may punish contractors that seek to resolve concerns about a solicitation outside the protest process.
The background of this case may sound eerily familiar to contractors. After receipt and review of a newly issued solicitation, Coulson sent letters to the agency questioning the decision to conduct the relevant procurement under FAR part 15 (as opposed to FAR part 12). The agency responded to Coulson’s letters by reiterating the government’s intent to utilize FAR Part 15 procedures. Over a month later, but before the date proposals were due under the Solicitation, Coulson submitted a bid protest to GAO. GAO dismissed Coulson’s protest, however, construing the letters previously sent to the agency by Coulson as “agency-level” protests – not just informal communications – and the agency’s responses to be denials of those protests. Accordingly, GAO concluded that GAO’s Bid Protest Regulations required Coulson to submit any protest to GAO within 10 days after the protest denials (as opposed to the deadline for submission of initial proposals). Because Coulson’s letters to the agency were determined to be an agency-level “protests,” Coulson’s time to file a pre-bid protest at GAO was cut short by five months.
How can this be, you might ask? As a general rule, GAO’s Bid Protest Regulations require prospective offerors to file a bid protest challenging any “alleged improprieties in a solicitation” prior to the deadline for the submission of initial proposals (4 C.F.R. § 21.2(a)(1)). However, GAO’s bid protest regulations also provide that if a contractor files an agency-level protest on the issue first, the contractor has only 10 days from denial of the agency-level protest to file a protest at GAO (4 C.F.R. § 21.2(a)(3)). GAO’s decision in Coulson exposes a circumstance where these two rules both come into play – when a prospective offeror submits an agency-level protest challenging a perceived solicitation defect, and then subsequently files a protest on the same issue to GAO.
What makes GAO’s decision particularly compelling is that Coulson alleged it never intended its letters to the agency to be considered agency-level protests in the first place. Instead, Coulson claimed its letters to the agency were merely seeking to resolve Coulson’s concerns regarding the Solicitation “through frank and open discussions” rather than through the protest process. Indeed, Coulson’s actions are not uncommon. To avoid filing formal bid protests, prospective offerors frequently voice their concerns regarding a solicitation provision through informal letters or emails. One would think that this course of action would preferable to the agency as well. Unfortunately, the Coulson decision actually punishes a contractor for attempting to avoid a formal protest. While GAO’s ruling in this case may be consistent with federal procurement regulations and case law, the reality is that the conclusion in Coulson is inconsistent with the FAR’s goal of encouraging contractors to resolve concerns through “open and frank discussions” prior to submission of an agency-level protest (FAR 33.103(b)), and “seek resolution within the agency before filing a protest with the GAO” (FAR 33.102(e)).
Coulson serves a critical reminder to contractors of the risk involved in sending informal communications to the agency complaining about solicitation provisions. Under GAO’s case law, such a letter may be deemed an agency-level protest if it contains “a specific expression of dissatisfaction with the agency’s actions and a request for relief,” even if was not intended to be a protest. And once your agency-level protest is denied, you have only 10 days to protest at GAO, even if the 10th day is prior to the due date for proposals.