A government contractor successfully filed a pre-award bid protest challenging the Defense Intelligence Agency (DIA) rejection of its proposal as late.  In the case of Electronic On-Ramp, Inc. v. United States, 104 Fed.Cl. 151 (March 28, 2012), the Court of Federal Claims applied the government control exception to the late proposal rule and issued an injunction in favor of the protester. As a result of the bid protest the agency was required to accept and evaluate the proposal it initially rejected as late.

The Court of Federal Claims, interestingly, was not concerned that the protester submitted non-identical electronic and paper copies of the bid.  The electronic copy was submitted timely, but the non-identical paper copy of the proposal (which, according to the RFP, would control in the event of inconsistency) was not in the contracting offices’ hands until after the time set for receipt of proposals.  The contractor’s courier was logged in at the security gate prior to time for receipt of proposals and had spoken to a representative in the contracting office by telephone.  The Court found the proposal to be under the government’s control prior to the deadline under the facts of this government contract bid protest case.

Government control exception calls for a fact-specific inquiry.

In applying the government control exception to late proposal rule, the Court made a fact-specific inquiry looking to the instructions in the solicitation and the nature of the agency’s facilities.    The Court noted that the government contractor did not receive an advantage by late submission, such as access to post-deadline information or having more time to prepare its proposal, and consideration of the proposal would not compromise the competitive process.

In applying the government control exception in this bid protest, the Court stated that the proposal was “under the government’s control” when the offeror relinquished control over the proposal such that the offeror could no longer modify the proposal.   Under this standard, many proposals rejected as untimely would seem to qualify.  However, the Court emphasized the fact that the contractor had timely submitted a complete copy of the proposal electronically.   (The fact that the electronic proposal was not identical to the paper copy did not trouble the Court since the RFP did not require identical proposals).

Possibility of waiver as minor informality.

The Court went even further, finding that even if the late proposal was not under government control, the late delivery of the paper copy could be waived as a minor informality in this bid protest case.  The agency should look to see if the offeror gained a competitive advantage or prejudiced competing offerors, and if not, waive the late paper proposal as a minor informality.

The Court issued a permanent injunction requiring the DIA to consider the contractor’s late proposal.  The court concluded that the contractor, a Native American Indian, service-disabled veteran owned and certified small disadvantaged business, would be irreparably injured without a permanent injunction.  Recoupment of bid preparation costs was not considered a sufficient remedy, since this large dollar value contract represented a significant business-expansion opportunity for the small business.   The bid protest decision to issue an injunction would not work a significant hardship on the agency since the agency had not yet awarded a contract.

Government control exception calls for prompt action.

It was important to the contractor’s success in this bid protest case that it acted quickly to assert its rights.  The Court of Federal Claim’s decision to issue an injunction might have been different had the agency already awarded a contract.  If your company needs assistance with your late bid or proposal issue, contact Hindson & Melton LLC as early as possible for assistance with your case.
Karen S. Hindson – July 23, 2012