Greenleaf asserts that the award to CLF was improper because CLF's proposal misrepresented the resources and staff CLF intended to use to perform the contract. An offeror’s material misrepresentation in its proposal can provide a basis for disqualification of the proposal and cancellation of a contract award based upon the proposal. A misrepresentation is material where the agency relied upon it and it likely had a significant impact upon the evaluation. Integration Techs. Group, Inc., B- 291657, Feb. 13, 2003, 2003 CPD para. 55 at 2-3; Sprint Communications Co. LP; Global Crossing Telecommunications., Inc.--Protests and Recon., B-288413.11, B‑288413.12, Oct. 8, 2002, 2002 CPD para. 171 at 4; AVIATE L.L.C., B-275058.6, B‑275058.7, Apr. 14, 1997, 97-1 CPD para. 162 at 11. Based on our review of the record, we find that HUD’s evaluation of CLF’s proposal was unreasonable because it was based on aspects of CLF’s proposed resources and technical approach that, after the submission of CLF’s FPR, and unbeknownst to the agency, materially changed such that the agency never evaluated the awardee’s actual resources and technical approach as they existed at the time of award. (Greenleaf Construction Company, Inc., B-293105.18; B-293105.19, January 17, 2006) (pdf)

Here, even if we assume, arguendo, that AKMI is not, and has never been, affiliated with Keith Moving, Inc., AKMI provided no information in its proposal to suggest that the D&B report, which reflected that AKMI was an alternate name for Keith Moving, Inc., was inaccurate or otherwise unreliable. On the contrary, at the time of the contemporaneous evaluation of proposals, there was sufficient information in AKMI's proposal, particularly when read in conjunction with information in the D&B report, for GSA to reasonably conclude that AKMI was affiliated with Keith Moving, Inc., a firm that had been proposed for debarment, thereby making AKMI ineligible for award.  (Aardvark Keith Moving, B-290565, August 8, 2002)  (pdf)

C. The Air Force Decision Not to Reinstate FAS in the TSBMC Procurement

The suspension of FAS required its removal from competition for the TSBMC. This left the Air Force with one offeror, VBR, for the contract award. After FAS divested its 49% owner, Taos-Agility, and DLA then removed FAS from the EPLS, FAR 9.405(d)(3) provided that the contracting officer “may, but is not required to, consider” the proposal FAS had previously submitted. Plaintiff asserts that the contracting officer’s exercise of the discretion provided by FAR 9.405(d)(3) must be closely scrutinized to fulfill the mandates of the Competition in Contracting Act of 1984 (“CICA”), Pub. L. No. 98-369, § 2713, 98 Stat. 1175, 1182 (1984). See Birch & Davis Int’l, Inc. v. Christopher, 4 F.3d 970, 974 (Fed. Cir. 1993). The CICA requires full and open competition. 41 U.S.C. § 253(a)(1)(A). Competition is required so that “a sufficient number of offers is received to ensure that the government’s requirements are filled at the lowest possible cost.” H.R. Rep. No. 1157, 98 Cong., 2d Sess. 17 (1984). See th United States v. Thorson Co., 806 F.2d 1061, 1064 (Fed. Cir. 1986).

Defendant and intervenor argue that close scrutiny is not required for the FAR 9.405(d)(3) decision not to reinstate FAS, but if required, even under this level of scrutiny the decision was reasonable. Plaintiff argues that the contracting officer abused her discretion in deciding not to reinstate FAS and that the decision lacks a reasonable basis. FAS asserts that the contracting officer’s concern with the delay involved in reinstating FAS was not reasonable. Reliance is placed on the short response time given to FAS in a draft list of questions concerning the responsibility determination the contracting officer would have to make had Taos-Agility remained one of the owners of FAS. However, there is a considerable difference between the time that would be required to explain the Taos-Agility function in an unchanged FAS proposal and the time required to redraft and submit a new proposal without Taos-Agility involvement and for the Air Force to complete the required evaluations and discussions on such a new proposal. The evaluations and discussions on the  proposal FAS submitted on May 22, 2009, were not completed until September 30, 2009. (AR 002158.) Plaintiff also indicates that the contracting officer on the date of issuing her seven-page “Justification” for not reinstating FAS had knowledge of the agency-level protest that FAS submitted on the same date requesting reinstatement. Since an award could not be made until the protest was concluded, plaintiff argues that delay involving a new FAS proposal in the procurement, was not a reasonable concern because there would be delay in any event due to the protest. FAS’s protest does not refer to the contracting officer’s Justification and the Justification does not refer to the protest, indicating that neither party had knowledge of the other’s submission when drafting their own. The fact that delay could occur from a protest submission in no way impacts whether the contracting officer’s concern over delay a new FAS proposal eliminating Taos-Agility would engender was reasonable.

A close examination of the reasons given for the decision not to reinstate FAS after it had divested its Taos-Agility ownership leads to the conclusion that the reasons have a rational basis. Delay was a factor and the contracting officer’s Justification in this regard demonstrates a rational basis for the conclusion reached. The full and open competition requirement of CICA was not violated. There was competition up to the point where FAS was suspended and the price proposals of the two competitors were evaluated. FAS did not change its price proposal in its FPR, whereas VBR substantially lowered its already lower price proposal in its FPR and retained this lower price up to award. Based on this history, the contracting officer rationally concluded that with the substantial challenges ahead that FAS would face, were it to be reinstated, it was unlikely that FAS would lower its price proposed, when it had not done so previously. In this circumstance, with the award to VBR, the Air Force obtained the lowest possible cost that competition, as required by CICA, was intended to achieve.

Finally, the contracting officer in her Justification for not reinstating FAS concluded that with the divesting of Taos-Agility, entities that FAS relied upon in its proposal for performance, resources and past performance, FAS’s higher price, and the challenges ahead in submitting and obtaining successful evaluations for a new proposal, FAS did not have a reasonable chance to receive the award of the TSBMC. In this procurement protest matter the issue is whether the agency action has a rational, reasonable basis. Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324, 1332-33 (Fed. Cir. 2001); Honeywell, Inc. v. United States, 870 F.2d 644, 648 (Fed. Cir. 1989). For the reasons stated in the Justification issued by the contracting officer, the suspension of Agility-Taos, resulting in the removal of 49% of the ownership of FAS, and the challenges this presented to the viability of a new FAS proposal, comprised a rational basis for her conclusion that the reorganized FAS, at this stage of the procurement, had no reasonable chance of obtaining the award of TSBMC. Plaintiff has failed to meet the heavy burden of demonstrating a lack of rational basis for the contracting officer’s decision in the record of this protest.  (FAS Support Services, LLC v. U. S. and Vinnell Brown & Root LLC, No. 10-289C, August 4, 2010)  (pdf)  See above FAS Support Services, LLC, B-402464; B-402464.2; B-402464.3, April 21, 2010  (pdf)

The United States Court of Appeals for the Federal Circuit held in Planning Research Corp. v. United States, 971 F.2d 736 (Fed. Cir. 1992) that:

[T]he submission of a misstatement . . . which materially influences consideration of a proposal should disqualify the proposal. The integrity of the system demands no less. Any further consideration of the proposal in these circumstances would provoke suspicion and mistrust and reduce confidence in the competitive procurement system.

Id. at 741 (citation omitted).

Therefore, to establish a material misrepresentation, Sealift must demonstrate both that TAL intentionally made a false statement and that MSC relied on that false statement in awarding the contract to TAL. See Blue & Gold Fleet, LP v. United States, 70 Fed. Cl. 487, 495 (2006) ("To establish a material misrepresentation, plaintiff must demonstrate that (1) [the awardee] made a false statement; and (2) the [agency] relied on that false statement in selecting [the awardee’s] proposal for the contract award. . . . To preserve the integrity of the solicitation process when such a material misrepresentation influences the award of the proposal, the proposal is disqualified from consideration.") (citations omitted), aff'd, 492 F.3d 1308 (Fed. Cir. 2007); see also Northrop Grumman Corp. v. United States, 50 Fed. Cl. 443, 468 (2001) ("[I]t is quite common for proposals to fall short of their assertions; it is not something to be punished unless the errors were willful and egregious."). Intent may be established by circumstantial evidence. See Planning Research Corp., 971 F.2d at 742 ("This court has held that intent frequently must be proved by circumstantial evidence.”) (citing Klein v. Peterson, 866 F.2d 412, 415 (Fed. Cir. 1989)).

In awarding this contract, MSC advised that:

It is useful to compare the offered rate to previous contract awards for comparable vessels under similar requirements. . . . Th[ese] comparisons provide support that the rates offered by [TAL] and Sealift under this procurement are both highly competitive and very reasonable.

AR 1985.

MSC's price analysis also stated that: [T]he daily rate proposed by [TAL] is considered fair and reasonable based on price competition and comparison with previous competitively awarded prices for comparable vessels under similar requirements in accordance with FAR [] 15.404- 1(b)(2)(i) and (ii)15 respectively.

AR 1992.

Sealift's primary evidence that TAL misrepresented the Bonito's warranted fuel consumption is the Raggio Declaration that relies on a single data point found on a website. See AR 2266. The Government, however, states that: "[t]o assess [TAL]'s compliance with its fuel warranties, it is necessary to gather information on the vessel's speed, weather conditions, load, and fuel consumption for each voyage the vessel makes." See AR 2513. Sealift agrees that "[g]auging actual fuel consumption requires some research, judgment, and initiative" in addition to "expert review of the varying factors that affect vessel operations." Pl. Mem. at 16.

The March 31, 2006 Solicitation provided that the "[c]ost of fuel consumed will be based on an operational scenario of 60% underway laden at 12 knots . . . , 28% in-port idle . . . , and 12% in-port discharge[.]" AR 1572. The Raggio Declaration, however, only considered the Bonito's fuel consumption "when steaming at 12 knots." AR 2266 (Raggio Declaration ¶ 6). Moreover, it did not consider the March 31, 2006 Solicitation’s required “operational scenario.” See AR 1572. The Raggio Declaration also assumed that "[t]he slightly larger engine on the Bonito should have a fuel consumption no less than that of the Montauk." See AR 2266 (Raggio Declaration ¶3) (emphasis added). Other evidence, however, indicates that the Montauk burned 188 grams of fuel per KWH under a 100 percent load and 187 grams of fuel per KWH under an 85 percent load, while the Bonito burned 182 grams of fuel per KWH, under a 100 percent load, and 180 grams of fuel under an 85 percent load. See AR 2266, 2476-77, 2481 (citing http://www.sea-web.com, an online service of LLOYD'S LIST). Sealift did not challenge this data.

Nordtank does not guarantee or warrant the data on the website. See AR 2301-07. In addition, the cases cited by Sealift are not precedential and do not stand for the proposition that fuel consumption rates on a website are warranted. See Pl. Reply at 5. Instead, they hold that a representation of fuel consumption in a charter may create a warranty in certain circumstances. See Transatlantic Lines, LLC, Soc’y of Mar. Arb., No. 3834 (Nov. 4, 1998) (determining that "speed and fuel consumption capabilities" were incorporated into a contract through an annex); see also Denholm Shipping Co., 47 F.2d at 214-15 ("[A] description of a ship's capacity, in speed, as well as in any other respect, when inserted in the body of a charter, will support a suit for damages.") (citation omitted) (emphasis added); The Atlanta, 82 F. Supp. at 230 (a statement as to speed and fuel consumption in a charter results in a warranty "rather than a representation, even though the statement is not expressly designated as a warranty").

Accordingly, the court has determined that the Bonito's fuel consumption rate, posted on Nordtank's website, does not evidence a material misrepresentation by TAL, particularly since Sealift has not proffered any independent evidence that the information on Nordtank's website was reliable. See AR 2301-07. In addition, the Administrative Record contains no evidence that the Bonito did not achieve a consumption rate of [redacted] barrels per day, although the court afforded Sealift the opportunity to supplement the Administrative Record with post-award information. See AR 2536-3047; see also 1/17/08 TR 38, 41-42.

For these reasons, the court has determined that, as a matter of law, Sealift did not establish a false statement was made by TAL to the CO. See Blue & Gold Fleet, LP, 70 Fed. Cl. at 495.  (Sealift, Inc., v. U. S., No. 07-627C, July 11, 2008) (pdf)