The GAO’s recent decision in Raymond Express International, B-409872.2 (Nov. 6, 2014) serves as a reminder to contractors that unreasonable evaluation criteria can successfully be challenged if timely protested before the deadline for submission of proposals.
Raymond protested the terms of a solicitation issued by the Defense Commissary Agency for fruits and vegetables for commissaries in the Korea, Japan, and Guam. Raymond’s primary challenge was to the solicitation’s price evaluation criteria. An ambiguously written solicitation stated that price would be evaluated based on the total price for all high volume core items (HVCI) and required offerors to submit HVCI unit prices as of the week of July 14, 2014. However, the solicitation also required a patron savings discount program that would provide a discount relative to prices of like items from comparable private sector retailers. The discount was to remain fixed, but the base unit pricing would be updated on a weekly basis to match market conditions. Consequently, the prices paid by patrons would vary over time. The solicitation did not clearly state whether proposed unit prices or proposed discount rate would be the basis for evaluation.
Raymond challenged the agency’s use of the non-binding July 14, 2014 unit pricing as a basis for evaluation, rather than the patron savings discount amount. Raymond argued that this approach was misleading, as it would allow offerors to “game” the procurement by lowering its July 14, 2014 unit prices and decreasing the discount percentage.
GAO sustained this protest ground, citing well-established GAO case law that “an agency may not use an evaluation method that produces a misleading result.” Notably, GAO referred to the lack of clarity regarding the pricing evaluation method as “ambiguities in the solicitation.” Arguably, this protest ground could have been brought post-award, on the basis that this was a latent ambiguity in the solicitation which did not become patent until after award. While latent ambiguity is a viable argument in some post-award situations, the argument is not without risk, as the GAO may find that the ambiguity was patent prior to submission of proposals. Raymond took the more cautious (and in this case, successful) approach in bringing the protest pre-award.
The Raymond decision serves as a reminder to contractors that challenges to the solicitation, including the evaluation scheme, can be successful. Of course, not all challenges will succeed; indeed, the GAO denied one of Raymond’s alternate protest grounds. But by bringing this protest pre-award, Raymond ensured that it could structure its price proposal it order to ensure that it received the most favorable evaluation possible.