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FAR 9.400:  Debarment, Suspension, and Ineligibility

Comptroller General - Key Excerpts

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)

Comptroller General - Listing of Decisions

For the Government For the Protester
Shinwha Electronics, B-290603; B-290603.2; B-290931; B-290932, B-290932.2, B-291064, September 3, 2002 Greenleaf Construction Company, Inc., B-293105.18; B-293105.19, January 17, 2006 (pdf)
Aardvark Keith Moving, B-290565, August 8, 2002  (pdf)  

U. S. Court of Federal Claims - Key Excerpts

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)

U. S. Court of Federal Claims - Listing of Decisions
For the Government For the Protester
Sealift, Inc., v. U. S., No. 07-627C, July 11, 2008.  (pdf)  
   
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