LawFlash

Proposed Sole Source Award Upheld on Test Schedule Grounds

June 04, 2019

The US Government Accountability Office’s (GAO’s) recent decision denying the bid protest of Humanetics Innovative Solutions, B-416979.3, permits the US Army to procure critical technologies without full and open competition because the agency reasonably insisted that protestor’s product would need to undergo much more testing than the proposed awardee’s, and the time required for this testing would make protestor’s product late to need.

Fundamental to government contracts, the Competition in Contracting Act (CICA) requires agencies to obtain full and open competition in procurements through the use of competitive procedures unless an exception applies.[1] As a result, prospective offerors often protest agency decisions to award sole source contracts to other vendors without competition. One exception to the requirement for competition is where the supplies or services needed by the agency are available from only one responsible source, and no other type of property or services will satisfy the agency’s requirements.[2] CICA expressly permits agencies to determine that only one source is available in the case of a follow-on contract for the continued development or production of highly specialized equipment, or the continued provision of highly specialized services, when award to a source other than the original source would likely result in: (1) substantial duplication of costs to the United States, which is not expected to be recovered through competition; or (2) unacceptable delays in fulfilling the agency's needs.[3]

Many prospective offerors disagree with an agency’s decision to award a sole source contract. However, GAO will review the agency’s sole source determination only to ascertain a reasonable basis for the agency’s actions, and will not sustain a protest in which protestor merely disagrees with the agency’s reasonable decision. Accordingly, when challenging a sole source decision predicated, as in Humanetics, on unacceptable delay due to required testing, protestors should carefully examine the reasonableness of each of the elements necessary to support the overall reasonableness of the sole source decision: (1) the reasonableness of the government’s need date; (2) the reasonableness of the government’s assessment that testing is required; and (3) the reasonableness of the government’s estimate of the schedule impacts arising from this testing.[4]

GAO’s Humanetics decision and the underlying facts present a fascinating permutation of this analysis. Beginning in 2010, the Army identified a need for a Warrior Injury Assessment Manikin (WIAMan) Anthropomorphic Test Device (ATD) to predict the effects of IED underbody blasts (UBBs) on soldiers and evaluate vehicle configurations and designs intended to better protect US service members. The WIAMan ATDs are advanced technology, human-like blast test dummies uniquely designed to survive and measure blast forces directed from below. The proposed awardee for the sole source production contract, Diversified Technical Systems, Inc. (DTS), previously had been awarded and successfully completed a contract to develop multiple prototype WIAMan ATDs.

Because no test dummy transmits forces exactly the same as a human body, the responses of DTS’s WIAMan ATDs were correlated with human responses to underbody blasts through extensive testing on cadavers so that the ATDs could fulfill their intended purpose of accurately predicting injury in humans. This meant that a production model dummy manufactured by a different contractor, even if better than the prototype, actually could not be used by the Army without repeating this extensive testing because the correlations developed for the DTS WIAMan prototype could only be used for the DTS WIAMan or a production dummy that was the same, not better (or worse) than, the DTS prototype.

In Humanetics, the protestor alleged that, because the Army had issued a technical data package (TDP) for the WIAMan design and identified its requirement for production ATDs as “build-to-print,” it would be able to build the same WIAMan ATD so that it would be unreasonable to require additional testing. However, not all TDPs are created equal. Applicable military standards establish three different levels of TDP: conceptual, developmental, and product level. Only the product level TDP is defined as sufficient to permit any “competent manufacturer” to produce the item. DTS’s prototype contract called for the delivery of a developmental TDP sufficient only to support DTS’s own manufacture of the product; it did not, for example, provide the processes used to produce the parts whose dimensions were provided in the TDP. And the Army provided evidence that the same part manufactured by different manufacturers using the same developmental TDP reasonably could be expected to respond differently to underbody blast forces.

In reaching its decision, GAO noted that protestor had not challenged either the reasonableness of the Army’s stated need date or the reasonableness of the estimated individual test times. Instead, protestor focused only on the reasonableness of the Army’s determination that testing of any protestor ATD would be necessary, even if made in accordance with DTS’s (developmental) TDP. GAO found that the Army had established a reasonable basis for its concern that manufacturing process differences could lead to differences between any protestor production ATD and DTS’s prototype. GAO further found reasonable the Army’s conclusion that these variations would render the extensive, prior correlation work unusable and require significant amounts of duplicate testing causing the production ATD to be late to need for use on the only major vehicle development program on the test horizon. Accordingly, GAO denied the protest.

Contacts

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Washington, DC
Stephen E. Ruscus
Donna Lee Yesner



 

[1] 10 U.S.C. §2304(a)(1)(A).

[2] See 10 U.S.C. §2304(c)(1); FAR §6.302–1(a)(2).

[3] See 10 U.S.C. §2304(d)(1)(B); FAR §6.302–1(a)(ii).

[4] The Army also asserted that additional testing would result in substantial duplication of costs; however, GAO’s decision did not address this issue as it sustained the protest based on the reasonableness of the schedule and impact of delay on the Army’s needs.