Pre and Post Award Bid Protest

The Problem With Third Party Interested Party Bid Protests

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By Denis tarasov - Own work, CC BY-SA 3.0, https://commons.wikimedia.org/w/index.php?curid=15995884

Have you wondered why only an interested party may file a bid protest? Recently, the General Accounting Office (“GAO”) dismissed Latvian Connection, LLC’s bid protest because the GAO determined that Latvian Connections was not an “interested party.” Latvian Connection (which, surprisingly, is not an online dating site) protested the terms of the Department of the Army’s solicitation to procure battery-related maintenance services and office furniture for the Army’s base in Fort Huachuca, Arizona. Latvian Connection complained that the terms of the solicitation effectively excluded it from competing for the bid.

The Army issued the solicitations through the FedBid website pursuant to the Federal Acquisition Regulations. FedBid is a commercial online procurement services provider that runs a website at FedBid.com that, among other things, hosts reverse auctions.  A reverse auction swaps the roles of buyer and seller; in a reverse auction, the sellers compete to obtain business from the buyer by reducing their prices.  In its protest, Latvian Connection complained that FedBid had suspended it from using its services, thus effectively forbidding the firm from bidding on federal procurements conducted through FedBid.

Something Was Amiss...

Sensing that the sklandrausis did not smell right, the GAO reviewed an advertisement that had been sent to the it during the course of one of the other bid protests that had been filed by Latvian Connection, LLC. The advertisement stated in part that “if your company has been… cheated by… these contracting offices and wants to file a GAO… protest… then contact me.”  The advertisement went on to offer confidential bid protest filing services.

Due to the advertisement and the fact that Latvian Connection’s bid protest did not set forth capability to meet the solicited requirements, the GAO sent Latvian Connections three questions. The GAO wanted to determine whether Latvian Connections was actually interested in performing the solicitation or was acting on behalf of some undisclosed party in filing this protest. The questions asked: 1) whether the protest was filed on behalf of any party other than Latvian Connection; 2) whether Latvian Connection intended to submit a quotation in the event its protest was sustained; and 3) how Latvian Connection planned to perform the solicitation.

Latvian Connection stated that it was not acting for anyone other than Latvian Connection and that it was an interested bidder; it did not, however, answer how it planned to carry out the contract. Instead, Latvian Connection informed the GAO that, if it had concerns, the matter had to be referred to the Small Business Administration.

According to bid protest rules, only an “interested party” (i.e. an actual or prospective offeror whose direct economic interest would be affected by the award) may protest a federal procurement. Where a protester's “interested party” status is in doubt, the protester must affirmatively demonstrate (e.g. through past projects, financial capacity, etc.) that it is an interested party.  Merely stating so is not enough.

Here, the GAO found that Latvian Connection was not an interested party. In addition, the GAO was not persuaded by Latvian Connection’s argument that concerns about Latvian’s ability to perform should be resolved by the Small Business Administration. Accordingly, the GAO dismissed Latvian Connection’s bid protest.

As Latvian Connection demonstrated, a bid protest can require an experienced and knowledgeable advocate. If your business is involved in government contracting and procurement, the experienced attorneys at Whitcomb Law, P.C.can help you protect your rights.

About the AuthorJoe Whitcomb

Joe Whitcomb is the founder and president of Whitcomb, Selinsky, PC (WSM). In addition, he manages the firm and heads up the Government Procurement and International Business Transactions Law sections. As a result of his military service as a U.S. Army Ranger and as a non-commissioned officer in the Air Force, he learned mission accomplishment. While serving in the Air Force, he earned his Bachelor’s in Social Sciences and a Master’s in International Relations. His Master’s emphasis was on National Security and International Political Economics. After his military career, Joe attended law school at the University of Denver Sturm College of Law.


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