GAO finds Patriot’s protest ?meritorious? in contract dispute

GAO finds PatriotÆs protest æmeritoriousÆ in contract dispute    The U.S. Government Accountability Office has issued a decision, requested by a federal court in California, saying a protest by Patriot Contract Services (PCS) challenging a Navy contract 'is meritorious.'
   Patriot protested the award of a contract by the Navy through the Military Sealift Command (MSC) to American Overseas Marine Corp. (AMSEA) for the operation and maintenance of nine large medium-speed roll-on/roll-off ships to move U.S. military cargo worldwide. As the incumbent contractor, Patriot first filed a challenge to the AMSEA award with the GAO, and then withdrew its protest in order to file a similar action in the U.S. District Court for the Northern District of California.
   That case, 'Patriot Contract Services (PCS) vs. the United States (MSC),' is before the court, which on May 16 refused to grant Patriot's motion for a preliminary injunction that would halt any implementation of AMSEA's contract.
   Prior to refusing to issue an injunction, the court agreed with the GAO that Patriot had raised questions about AMSEA's conduct, and that Patriot would suffer irreparable harm if the government gave AMSEA the operation of the vessels before Patriot's claims can be adjudicated.
   When the district court refused to issue an injunction, despite its agreeing with the GAO, Patriot filed an emergency appeal for an injunction before the U.S. Court of Appeals for the Ninth Circuit.
   The full GAO decision, first issued May 11, was subject to a protective order from GAO and has since been released publicly in a redacted version.
   In its decision, the GAO said, 'we conclude that AMSEA made material misrepresentations in its proposal regarding compliance with the (initial) solicitation's requirements for proposed key personnel ' and ' it is clear that the Military Sealift Command relied on AMSEA's misrepresentations' in awarding the contract.
   'Accordingly, if our office were resolving the protest, we would sustain it and recommend that AMSEA's contract be terminated and that a contract be awarded to PCS (Patriot) if otherwise appropriate,' the GAO concluded.
   The contract had been awarded to AMSEA 'on the basis of its lower evaluated price' — $122.6 million compared to Patriot's $129.2 million — for operating and maintaining the nine vessels, the GAO noted. Patriot subsequently argued AMSEA had 'proposed personnel it did not have' and could not 'reasonably expect to furnish' during the performance of the contract, the GAO said.
   The GAO found specifically, in recorded interviews with proposed personnel, that AMSEA had not discussed 'position, salary and benefits' as required in the original request for a proposal (RFP). 'An agreement to work for a successful offeror, without reaching agreement on salary and benefits, is no more than a promise to negotiate for employment and is not a binding commitment,' the GAO explained.
   In the view of the GAO, 'an offeror's submission of a proposal containing material misrepresentations should disqualify the proposal from consideration' of a contract award. 'The integrity of the procurement process demands no less,' the GAO said.