Survival System, USA. Inc. v. United States
102 Fed. Cl. 255
| Fed. Cl. | 2011Background
- SSI, a small business, protests USMC award of a fixed-price contract for underwater egress training; award to ProActive after re-competition; Amendment 15 changed evaluation to lowest-price technically acceptable; revised SOW set minimum staffing; independent price analysis scrutinized ProActive’s labor pricing; GAO dismissed SSI protest; court denied SSI motion and granted defendants’ cross-motions.
- Amendment 15 required two technical factors and a two-stage price evaluation (acceptability then lowest price among acceptable proposals).
- Three offers remained after competition: ProActive, Survival Systems, and DMS; ProActive had the lowest evaluated price but concern arose over wage and staffing assumptions.
- The agency performed a thorough technical evaluation of ProActive’s proposal, not just blanket assertions, and concluded it met staffing and maintenance requirements in the revised SOW.
- Price analysis used by the agency relied on competition, historical prices, and an extensive price analysis to check for buy-in, with a finding of adequate price competition.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SSI waived its challenge to the technical evaluation. | SSI argued ProActive’s staffing and evaluation were deficient. | Defendant maintains waiver; argument not preserved in moving papers. | Waived; or at least properly supported as adequate even if preserved. |
| Whether the agency’s technical evaluation was proper. | ProActive’s staffing and technical approach failed to meet Amendment 15 staffing terms. | Agency conducted a detailed evaluation under the amended RFP and SOW. | Properly conducted; ProActive found technically acceptable. |
| Whether the price evaluation was reasonable. | Independent price analysis misapplied wage data and overemphasized Hawaii Okinawa comparability. | Analyses consistent with FAR and solicitation; used historical pricing data. | Reasonable under the FAR; adequate competition existed. |
| Whether ProActive’s pricing was unbalanced. | Prices for mobilization and base-year services were unbalanced and risky. | No unbalanced pricing; analysis supported by price documents. | Not unbalanced; agency reasonably concluded no significant unbalance. |
| Whether staffing minimums required full-time equivalents (FTEs). | Amendment 15 required full person-years per position. | Solicitation did not require FTEs; could meet minimum staffing non-FTE; evaluation restricted to stated factors. | No requirement for FTE staffing; evaluation properly focused on minimum staffing. |
Key Cases Cited
- Bannum, Inc. v. United States, 404 F.3d 1346 (Fed. Cir. 2005) (two-step bid protest framework: arbitrary action; then prejudice)
- Impresa Construzioni Geom. Domenico Garufi v. United States, 238 F.3d 1324 (Fed. Cir. 2001) (arbitrary or capricious standard; rational basis required)
- State Farm Mut. Auto. Ins. Co. v. State Farm, 463 U.S. 29 (1983) (highly deferential review; rational basis suffices)
- Alabama Aircraft Indus., Inc.-Birmingham v. United States, 586 F.3d 1372 (Fed. Cir. 2009) (agency rational basis; regularity presumption)
- Novosteel SA v. United States, 284 F.3d 1261 (Fed. Cir. 2002) (reliance on agency arguments; waiver and preserve)
- Savantage Fin. Servs., Inc. v. United States, 595 F.3d 1282 (Fed. Cir. 2010) (affirmation of regularity; prudence in procurement decisions)