*4 systems engineering analysis, and and oth- NEWMAN, PROST, Before DYK and Space er work related to the Cen- Warfare Judges. Circuit performance ter. The term of was to be months, beginning
twelve on October DYK, Judge. Circuit one-year with options. seven RFP, This case involves the distinction be- Under the the contract was to be tween “clarifications” and “discussions” gives awarded “to an offeror who the Gov- Subpart under the 1997 revision to 15.3 of it greatest ernment confidence Acquisition Regulations. requirements the Federal 48 will best meet afford- [the] §§ In ably.” C.F.R. 15.300-08 Information RFP at 81. accordance with 2305(a)(2)(A) notice, “Please note that this clarification § U.S.C. U.S.C. 253a(b)(l), with RFP “all does not constitute oral discussions also disclosed 0002, referring sub- EN to 48 significant factors and the offeror.” significant 15.306(a). “reasonably ex- factors” C.F.R. consider,” their relative
pected] responded May to the ENs on RSIS 2305(a)(2)(A) importance. 10 U.S.C. pro- explaining parts 253a(b)(l) (2000); (2000); 41 U.S.C. ject support each subcontractor would RFP at 81-85. detailing the subcontractors’ relevant ITAC, a third offeror submit- RSIS and tasks. experience regard with to those response to the timely proposals ted example, response to EN For proposals anticipated RFP. All three Aerojet responded, “[subcontractor] RSIS performed by the work would be some of developed integrated has CTPP/ RSIS’s relied subcontractors. IR warn- ALERT and the JTAGS missile subcontractors, heavily on the role systems into the tactical ing processing perform which were to at least 75% of the warning operational C2 architec- missile *5 work on the contract. (Similarities ture, Require- to [contract] V-59).” (RSIS V-67, ments, Re- “evaluation The Air Force sent various Notice.) to Evaluation sponse (“ENs”) to all three offerors. notices” were brief These evaluation notices letters gave Air Force The both ITAC requesting additional infor- to the offerors exceptional rating” an “overall for RSIS The Air regarding proposals. mation their “past performance” experience. their ITAC, five Force three ENs to ENs sent Analysis for RFP (Proposal Report RSIS, the third offer- to and three ENs to 2001). FA2550-01-R-0001, July # or. At in this case are ENs Nos. .issue Air Force determined that prior contracts 0002a, Air Force 0002 and which the of RSIS and its subcontractors were rele- sent after the offerors had sub- to RSIS ability perform Space vant to their information, “past performance” mitted Warfare Center contract. parts but the due date for the other before performed The Air Force an indepen- proposals. sought of the The ENs at issue analysis” dent “Most Probable Cost on the verify ... rele- “additional information proposals by submitted and the third RSIS vant lead and past performance [the] analy- bidder. The “Most Probable Cost ten support roles” of at least subcontrac- independent analysis sis” was an proposal. tors that in its EN RSIS listed bidder’s estimated cost for “reasonable- No. The Air Force sent ENs to the 0002. ness” and “realism.” RFP at 85. The Air infor- requesting other bidders additional compatibility Force “assessed] as well.1 mation on their subcontractors proposed scope “FAR overall costs with the disputed ENs were labeled 15.306(a) performed.” included the effort to be Id. The Air Clarification[s]” regard- disputed concerning certification and clarification In addition to the ENs istration subcontractors, RSIS's the Air Force sent ing price the estimated for one of its subcon- seeking ENs to RSIS Small Business Admin- seeking It ENs to the third bidder tracts. sent completion istration certification and of sec- subcontractors, regarding information tions It G-5 and G-6 of solicitation. sent Small Business Administration certification seeking ENs to additional information ITAC completion section I. of solicitation subcontractors, on its Small Business Admin- summary, In offered an excellent a “Most Probable RSIS perform did not Force proposal be- with lower risk and several in- proposal, on ITAC’s analysis” Cost approaches improve team found novative efficien- cause its evaluation cy operations were so minimal of SWC that were deemed hours proposed ITAC’s it was infeasible to to be beneficial to Government. As and unrealistic (Source result, analysis. proposal provided a the RSIS adequate an perform 4.) a Document at As overall best to the Government. Decision Selection .value analysis per- my integrated Based on assessment that independent of this result proposal provided the third a better to RSIS and RSIS respect formed with offer, I bidder, the esti- technical and lower risk direct the Air Force increased Systems. the third the award to RS Information labor hours for RSIS and mated bidder, “that additional determining after Id. Because was one of the “Cost/Price” category labor required hours each higher in which scored categories RSIS the effort.” successfully perform Info. ITAC, than the refusal of the Air Force to Corp. & Applications Tech. analysis” conduct a “Most Probable Cost C, n. 15 slip op. 01-637 No. a of ITAC’s or make similar ad- 2001). (Fed.Cl. sug- There is Dec. no justment ,to its labor hours to make them adjustments resulted these gestion alleged more realistic is to have been responses disputed to the from RSIS’s significant winning factor in ITAC’s not ENs. the contract. an- July Force On 6, -2001, August On ITAC filed a bid *6 the contract nounced its decision to award with protest Accounting the General Office In its Decision RSIS. Source Selection (“GAO”). protest The GAO denied the bid Document, that all explained the Air Force Air Force and the awarded contract to proposals equally three were rated for RSIS on November 2001. Management Integration” and “Program 13, 2001, filed this (which On November ITAC and for “Past Performance” was in post-award protest bid the Court of ENs), subject disputed of the and that Among grounds Federal for Claims. not, therefore, “discriminating these were that protest the bid was ITAC’s contention (Source factors.” Selection Decision Docu- the Air Force conducted “discussions” with 2.) ment at The Air Force determined RSIS, it by virtue of the ENs sent to RSIS although provided proposals Offerors “[a]ll conduct “discussions” with but failed to require- which met minimum contract ITAC, § and in violation of U.S.C. 253b ments,” proposals and “all were fundamen- § it argued 15.306. 48 C.F.R.. ITAC sound,” tally “key discriminators were for the Air Force “to impermissible was ..., Proposal in Capability made Mission regarding in with engage discussions RSIS Risk, at 1. Id. RSIS CosVPrice.” and deficiencies in RSIS’s the weaknesses performed higher than ITAC in the cate- part proposal, of its past performance gories Capability” of “Mission and “Pro- perceived hide from ITAC the [sic] then posal Risk.” Id. at 2-4. In the area of pro- in” cost found, and deficiencies its “Cost/Price,” weakness the Air Force “RSIS in the Air Force’s declin- posal (resulting provided price the lowest overall for anal- ing to conduct a “Most Probable Cost provided written Task Order and the best ITAC). at with 51 Fed.Cl. ysis” respect Id. at price overall to the Government.” 5. Reply Plaintiffs (quoting Air Consolidated Force concluded: 2001). 7, 2001, the of Fed- of Nov. ITAC contended'that On December Court thereby opened protest, grant- eral Claims denied the bid improperly Force summary holding ing government’s “discussions” with RSIS without motion theory judgment all on the administrative record. “discussions” with bidders. The Contrary opened, that if had been 51 Fed.Cl. at was discussions contention, the court determined opportunity ITAC would have had the ITAC’s that the Ah- Force had not conducted dis- proposal. cure the weaknesses Id. at 353-55. The court rea- cussions. ability contracting officer to 15.306(d) contemplates soned that section governed by conduct “discussions” is both will after a determi- discussions occur regulation. 41 U.S.C. statute Under range competitive propos- nation of the 253b(d) 2305(b)(4)(A), § § and 10 U.S.C. made, als has been and in the context of agency may an award a contract “after having-the opportunity offerors’ to revise discussions with the offerors” or “based on proposals. their The court determined proposals received and without discussions that, agency because the did not intend to 253b(d) with the offerors.” U.S.C. allow offerors to revise their proposals 2305(b)(4)(A) (2000). (2000); 10 U.S.C. had not made a determination of the com- discussions, agency If the decides to hold petitive range, none of the ENs constitut- however, it “competi- first must establish a ed discussions. Id. at 354. The court range comprised highly tive of all the most concluded that the ENs were either “clari- 15.306(c)(1) proposals.” rated 48 C.F.R. fications,” 15.306(a), under section or (2002). compet- In order to determine the “communications,” 15.306(b), under section itive range, agency may engage and that the not therefore im- did offerors, “communications” with the properly only hold discussions with one “exchanges, are defined as between the bidder. Id. 354-55. The court also offerors, receipt Government and after rejected grounds pro- the other of the bid proposals, to establishment leading test. 15.306(b) competitive range.” 48 C.F.R. *7 timely appeal ITAC filed this the court’s December 7 decision. This court If decides award the con- discussions, jurisdiction exclusive over an holding appeal tract after it must has hold all from the Court of Federal under 28 responsible discussions “with offer- Claims 1295(a)(3). § proposals Myers Investigative ors who submit within the com- U.S.C. States, 253b(d)(l)(A) & v. petitive range.” § 41 Servs. United 275 F.3d U.S.C. Sec. (Fed.Cir.2002). 2305(b)(4)(A)(i)(2000). 1366, 1369 (2000); § 10 U.S.C.
However, agency may hold “discus-
sions conducted for the of minor DISCUSSION clarification” with one or more 'offerors. 253b(d)(l)(B) (2000); § 41 U.S.C. 10 I 2305(b)(4)(A)(ii)(2000). § pro- U.S.C. regulations
curement “clarifica- grant define We review the or denial of exchanges, tions” as “limited summary judgment upon between motions for offerors, may Government and occur administrative record without deference. Concepts, when award without discussions is contem- Advanced Data Inc. v. United 15.306(a)(1) (2002). (Fed.Cir.2000). States, plated.” 48 C.F.R. 216 F.3d 1057
1319 necessary standing.” element of capricious” “arbitrary and reapply We at F.3d 706 of the Administra of section standard pro Force’s Procedure Act to
tive
prejudice,
To establish
ITAC must
Impresa Construzioni
decision. See
curement
that there was a “substantial chance”
show
Domenico
Geo
m.
Garufi
it would have received the contract award
(Fed.
States,
1324, 1332
238 F.3d
alleged
procure
for the
error in the
but
Cir.2001)
28 U.S.C.
(holding
Separation,
Laval
process.
ment
Alfa
1491(b),
and accord
by
plain
its
terms
Inc. v. United
175 F.3d
“
history,
‘applies
ing
legislative
to its
(Fed.Cir.1999) (citation omitted).
In other
Act standard
Procedure
Administrative
words,
securing
chance of
protestor’s
by the district
applied
previously
review
have
the award must not
been insubstan
706)’”)
(5
H.R.
(quoting
courts
U.S.C.
Fed’n,
1302;
at
tial.
Am.
258 F.3d
See
(1996)).
104-841, at 10
Rep. No.
Impresa,
Conf.
(1) (Fed. 1309, An gos executive shall evaluate v. Principi, 283 F.3d Cir.2002).
competitive proposals in accordance
Because neither 41 U.S.C.
(a)
with
subsection
of this section
253b nor 10 U.S.C.
2305 defines the
contract— n
may
award a
“discussion,”
“minor
terms
clarification” or
we assume that the terms have their ordi
(A) after discussions with the offer-
nary,
meaning,
established
for which we
ors, provided that written or oral
may consult dictionaries. Pesquera Mares
discussions have been conducted
States,
Australes LTDA v. United
with all responsible offerors who
(Fed.Cir.2001);
F.3d
Int’l Bus.
proposals
submit
within the com-
Machs.,
ing of the terms “discussion” and “minor
Although
these
definitions
statute,
clarification”
begin
we
with make clear that “discussions” are more
an analysis of the language of the statute
substantial communications than “minor
itself. Int’l Bus.
clarifications,”
Machs. v. United
none of these various defi
(Fed.Cir.2000),
201 F.3d
cert. nitions serves to
any
illuminate with
preci
denied,
121 S.Ct.
specific
148 sion which
exchanges of informa
L.Ed.2d 1025
statutory
If the
lan
“discussions,”
tion constitute
and which
guage
plain
unambiguous,
then it
exchanges
constitute
“minor clarifica
*9
controls,
may
and we
agen
not look to the
tions.” “The existence of alternative dic
cy regulation for further guidance.
tionary
term],”
Chev
definitions of [a
or the
ron, U.S.A., Inc. v. Natural Res.
failure of dictionary
provide
definitions to
Def.
Council, Inc.,
837, 842-43,
467 U.S.
104 a plain and unambiguous meaning of stat
(1984);
S.Ct.
We drafted Citibank, the rule to allow as much Smiley 735, 517 U.S. 742, exchange 1730, (1995). free of information between 116 S.Ct. L.Ed.2d offerors and the Nor is the possi- interpretation Government as new an impermis ble, sible construction permitting while still of the statute. without Barn Walton, 212, hart v. 535 U.S. complying discussions and applica- with S.Ct. 1265, 152 L.Ed.2d330 Because ble statutes.... policy This is expected regulation’s offerors, represent definitions a reason help to especially small entities able interpretation terms, of the statutory may not familiar with proposal be we defer to them and turn to the question preparation, permitting easy by clarifi- of whether regulation this was properly of, cation limited aspects of propos- their applied to the facts of this case. als. 51,228-29. Thus, at Id. the definition of IV
“clarifications” was
broad-
significantly
ened.
being
Rather than
“for the sole
question
communications in
purpose
eliminating minor irregularities,
case,
0002a,
this
ENs
0002 and
informalities, or apparent clerical mis-
of obtaining additional in
takes,”
provide
clarifications now
offerors
formation about the subcontractors that
opportunity
“the
clarify
to
aspects
certain
RSIS had listed in
proposal.
its
Specifi
proposals
(e.g., the relevance of an of-
cally, the ENs
provide
asked RSIS to
“ad
past performance
feror’s
information and
past
ditional relevant
performance infor
past performance
adverse
information to mation, to further describe the lead role
which the offeror has not previously had
for [the
EN
subcontractors].”
In
”
opportunity
an
respond)....
Compare
response,
its
explained
RSIS
parts
(1991),
48 C.F.R.
15.601
with 48 C.F.R.
project
each subcontractor would
15.306(a)(2)(2002).
support and detailed their relevant experi
ence
regard
with
to those tasks. The gov
No claim is made or can be made
ernment argues that these communications
impermissible
that it is
for an agency to
clarifications,
constituted
and not discus
change its
interpretation
statutory
agree
sions. We
for two reasons.
terms or even significantly broaden the
definition of
term.
Supreme
Court
First,
these communications were not
“rejected
has
argument
agen
that an
above,
discussions. As explained
the new
cy’s interpretation ‘is not entitled to defer
regulation contemplates discussions as oc-
ence because it represents a sharp break
curring in the
of negotiations.
context
prior
with
interpretations’ of the statute in
15.306(d) (2002).
such,
C.F.R.
As
when
Sullivan,
question.”
Rust v.
opened,
are
discussions
bidders have the
111 S.Ct.
1323
perhaps
or
tilt the
0002a,
performance score
past
and RSIS’s
and
0002
ENs
Pachter et
them,
its favor.” John S.
constitute dis-
did not
to
response
Rewrite,
al.,
15
98-05
The FAR Part
cussions.
(1998).
Briefing
Appellant’s
6
Papers
was
Second,
request
Air Force’s
the
is,
of “clarification”
cramped conception
of the
for clarification
merely
request
a
moreover,
harmony
not in
with the stated
of
subcontrac-
experience
RSIS’s
relevant
amendments,
1997
of the
The
tors,
by
regulation.
permitted
as
the
“[s]upport[]
open exchanges
to
more
was
may be
that “offerors
provides
regulation
industry,
the
and
al-
Government
between
clarify certain
opportunity
the
given
industry to
the
lowing
better understand
C.F.R.
proposals.”
48
aspects
of
the
requirement
Government
[sic]
15.806(a)(2)
example
One
industry proposals.”
understand
better
clarifica-
such a
of
regulation provides
the
51,224.
Reg.
Fed.
past
of an offeror’s
“the relevance
tion is
can
Id. We
information....”
performance
regulations
were the
not
Even
clear
between this
no distinction
discern
clear,
agency’s
an
give
we
deference to
the Air
regulation
in the
example
regu
own
interpretation of its
permissible
the sub-
clarification of
request for
Force’s
v.
Indi
United States
Cleveland
lations.
in this
experience
relevant
contractors’
Co.,
200, 218-19, 121
Baseball
ans
that the chal-
conclude
We therefore
case.
(2001);
Am.
149 L.Ed.2d
S.Ct.
communications, ENs
lenged
States,
262 F.3d
Express Co.
0002a,
for clari-
merely requests
were
(Fed.Cir.2001).
The
fication.
13.306(a)
“FAR
the ENs as
designated
notice,
the
and included
clarifications”
argument that the
reject appellant’s
We
clarification does
“[p]lease note
this
because
not be clarifications
ENs could
the
oral
with
constitute
discussions
not
information.”
“requested
they
additional
(referring to 48 C.F.R.
EN 0002
offeror.”
re-
would
Any meaningful clarification
15.306(a)).
inter
It was a reasonable
information, and
quire
provision
the
regulations to
acquisition
pretation
in the
given
example of a clarification
the
clarifications, and we
the ENs as
view
an offeror’s
“the
regulation,
relevance
recently
interpretation.
We
defer
information,” requires
past performance
[acquisition] regula
emphasized that “the
ap-
The
Id.
provision
the
information.
officer with
contracting
the
entrust
tions
a clarification
contends that
pellant also
discretion, extending even
especially great
in-
if the
new information
call for
cannot
regula
application
procurement
his
“necessary to evaluate
formation is
Tel.
v. United
Am. Tel. &
Co.
tions.”
requirement
There
no
proposal.”
(Fed.Cir.2002).
1374, 1379
307 F.3d
not be
that a clarification
regulation
that the
here
not shown
appellant
has
proposal.
for evaluation of
essential
regu
observed,
contracting officer misconstrued
under
commentary
As one
has
“
was not in
procurement
or that
by lations
regulations,
‘clarifications’
the new
with the law.2
increase in its
could lead to an
accordance
one offeror
alleges were irrel-
relying
past
it
reject
appel-
on
contracts
2. We have considered and
relying
by
on
to the
appeal.
appel-
evant
arguments
other
on
lant’s
alleges
it
improperly
experience of subcontractors
argues that
Force
lant
portion of the
performing
significant
rating by
not
high past performance
gave RSIS a
*12
CONCLUSION
strued.
the
Whatever
distinction between
“clarifications” and
in
“discussions”
reasons,
the foregoing
For
the decision
15.306,
C.F.R.
procedure by
the
of the United States Court of Federal
Air
implemented
the
Force
“indepen-
its
Claims is
dent cost evaluation” without
informing
of
agency’s
ITAC the
action when advised
AFFIRMED.
that the labor hours of all bids were too
low, does
any
not meet
reasonable defini-
COSTS
tion of “clarification.”
“Clarifications” are defined as “limited
No costs.
exchanges, between the Government and
offerors,
may
that
occur when
with-
NEWMAN,
PAULINE
Judge,
Circuit
out discussions is contemplated.”
dissenting.
15.306(a)(1)(2001).
C.F.R.
The agency’s
agree
panel
I
with the
unilateral
increase of
majority that the
the labor hours of
offerors,
two of the three
without disclo-
amendment to
section 15 of the Fed-
concern,
sure to the third of
agency’s
the
Acquisition Regulations
eral
was intended
cannot be rationalized as mere “clarifica-
to
protocol
liberalize the
ex-
governing
tion.”
surely
It is
not
type
of individu-
changes between
acquirers
federal
and
al interchange that was intended to be
during
bidders
procurement
process.
by the
authorized
amendment
to section
designed
Section 15 was
to
conve-
enhance
nience, but without
in fairness.
diminution
regulation
The amended
does not exoner-
ITAC states that had it been told that
agency’s
ate the
procedure
unusual
in this
low,
its labor hours were too
it would have
case,
generously may
however
it
be con-
explained the
expected
economies that it
to
work;
that
independent
the Air
Garufi,
Force’s
cost
menico
regularity. Impresa refusing Geom. Do- discovery alleged on Construzioni bias. cost-saving new certain through achieve stranger no ITAC was
technologies. con- contract; incumbent it was the
this to have it must be assumed
tractor needed the labor anyone, as
known, as well not ITAC was contract. perform *13 of a revised opportunity the same
offered In- bidders. as were other refused to
stead, simply Air Force analysis” on cost probable a “most
perform thereby precluding proposal,
the ITAC hours of labor to ITAC. While the in- unilaterally offerors other team, by ten by the evaluation
creased thirty percent offeror and for one
percent other, disquali- simply ITAC was
for the
fied. 15 amend- section ex- open more “support[ ]
ment was government between
changes un- industry to better
industry, allowing gov- and the requirements
derstand industry understand to better
ernment 51,224. It Reg. at 62 Fed.
proposals.” agencies to authorize not intended
was fundamentals regard to
to act without my colleagues’ From procurement.
fair procurement of a ratification
blanket flawed, respectfully I seriously was
dissent. HANLIN, Plaintiff- M.
William
Appellant, Defendant-Appellee. STATES,
UNITED
No. 02-5055. Appeals, States Court
Federal Circuit.
Jan.