Government Contracts Government Must Reimburse All Costs Associated with Protest
Thursday, April 15, 2021

Government Must Reimburse All Costs Associated with Protest

By Government Contracts Editorial Staff

The Comptroller General recommended the government reimburse the protester for all costs of filing and pursuing its clearly meritorious protest because the government waited until after outcome prediction alternate dispute resolution to take corrective action and the protest issues were not severable. The protester challenged a contract award for port security barriers, contending the government failed to investigate apparent unfair competitive advantage organizational conflicts of interest, conducted a flawed technical evaluation, used an unsound internal price estimate, and did not engage in meaningful discussions. Following ADR in which a Government Accountability Office attorney concluded there was no evidence the government identified or evaluated the OCI allegations and it was likely the protest would be sustained, the government decided to take corrective action. After GAO dismissed the protest as academic, the government conceded the protester was entitled to the costs associated with the OCI allegations but disputed the protester’s entitlement to costs tied to the remaining protest issues. According to the government, the remaining challenges were clearly severable from the concerns identified during ADR.

Issues Not Severable. In considering whether to recommend reimbursement of protest costs, GAO “generally consider[s] all issues concerning the evaluation of proposals to be intertwined and thus not severable; therefore, [GAO] will generally recommend reimbursement of the costs associated with both successful and unsuccessful challenges to an evaluation” (28 CGEN ¶114,142). However, GAO has limited its recommendations “where a part of a successful protester’s costs is allocable to a protest issue that is so clearly severable as to essentially constitute a separate protest” (21 CGEN ¶112,213). Here, the protester’s allegations regarding the OCI, technical evaluation, and best-value tradeoff rested on the same core set of facts, and since the government did not conduct an investigation into the OCI allegations to offer additional information, GAO considered all of the protester’s arguments to be intertwined with the protester’s meritorious challenge. Further, the allegations regarding the price estimate and discussions were intertwined with the factual and legal grounds that underpinned the OCI allegations, “namely, the close relationship between the [government and the awardee].” Accordingly, the government’s arguments to sever the costs were rejected. (Elemental Innovation, 36 CGEN ¶117,164)

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