BNUMBER:  B-265644.2
DATE:  May 1, 1996
TITLE:  Eastman Kodak Company--Entitlement to Costs

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Matter of:Eastman Kodak Company--Entitlement to Costs

File:     B-265644.2

Date:May 1, 1996

David M. Nadler, Esq., Dickstein, Shapiro & Morin, for the protester.
Danielle Conway-Jones, Esq., Army Corps of Engineers, for the agency.
Paula A. Williams, Esq., and Michael R. Golden, Esq., Office of the 
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Request that the General Accounting Office award costs of filing and 
pursuing a protest is granted where, after the agency filed its agency 
report, it took corrective action in response to the clearly 
meritorious protest allegations and the agency does not oppose the 
payment of the protester's costs.

DECISION

Eastman Kodak Company requests that our Office declare the firm 
entitled to recover the reasonable costs of filing and pursuing its 
protest challenging the conduct of the procurement under request for 
quotations (RFQ) No. DACW21-95-Q-0021, issued by the Army Corps of 
Engineers Savannah District for copier services.  
  
We award Eastman Kodak its costs of pursuing the protest, including 
reasonable attorneys' fees.

The RFQ sought quotations to purchase or lease 17 copiers with an 
estimated volume of 65,000 copies per month per copier.  After the RFQ 
was issued, the user advised the contracting division that the 
solicitation had been issued in error since its requirement was for 
copier services on a cost per copy basis, not for the purchase or 
lease of copy machines.  Rather than cancel the RFQ, the contracting 
officer decided to accept quotes for the purchase or lease of copiers 
and to seek informal quotes for the services on a cost per copy basis.  
The agency conducted a price analysis of the quotes received--for 
purchase or lease of the copiers and for copier services on a cost per 
copy basis--and concluded that the cost per copy was the most 
advantageous cost method for acquiring these services.  The Corps 
subsequently revised its estimated copy requirements from 65,000 to 
80,000 copies per month per copier; thereafter, it decided to acquire 
17 copiers under an existing contract between United States Army 
Information Systems Command (USAISC) and Xerox Corporation.[1]  By 
letter dated June 6, 1995, the Corps informed Eastman Kodak of its 
revised copy volume requirements and that it would procure these 
services under the USAISC contract.

Eastman Kodak filed an agency-level protest on June 16, alleging that 
the Corps had improperly evaluated its offer, which was based on an 
estimated volume of 65,000 copies per month, against its undisclosed 
requirement of 80,000 copies.  This protest also questioned the 
accuracy of the revised quantity and the decision to use the USAISC 
contract to satisfy its needs.  On August 8, Eastman Kodak protested 
to our Office, repeating its agency-level protest grounds; in 
addition, the protester alleged that the Corps's use of the USAISC 
contract violates the 30 percent requirements limit imposed against 
non-USAISC organizations.

On September 18, the Corps filed the agency's report and response to 
the protester's request for documents.  Based on its review of the 
agency's report and response to its documents request, Eastman Kodak 
submitted a request for additional documents and renewed its request 
for a hearing on September 21.  On September 28, a day prior to the 
date for the Corps's response to the protester's September 21 request 
for additional documents and a hearing, the Corps advised our Office 
that it was taking corrective action in response to the protest.  The 
Corps stated that it will evaluate its copying needs based on recent 
copy volume usage to determine its minimum requirement for copy 
volume; conduct a new market survey to determine the most advantageous 
method of acquiring these services and allow Eastman Kodak and other 
interested vendors to respond to the agency's requirements.  These 
actions effectively addressed the merits of the protest and were 
consistent with the remedies requested by the protester.  Based on the 
agency actions, the protester withdrew its protest by letter dated 
September 29, and we closed our file without further action. 

Eastman Kodak requests that we find it entitled to the costs of filing 
and pursuing its protest.  The Corps has responded that it does not 
oppose the request. 

Our Bid Protest Regulations provide that a protester may be entitled 
to reimbursement of its costs of filing and pursuing a protest, 
including reasonable attorneys' fees, where we determine that the 
agency unduly delayed taking corrective action in the face of a 
clearly meritorious protest.  4 C.F.R.  sec.  21.6(e) [now 4 C.F.R.  sec.  
21.8(e)] (1995); Multi-Bloc, Inc.--Entitlement to Costs, B-259182.2, 
Apr. 20, 1995, 95-1 CPD  para.  217.  Here, the Corps admits that its 
corrective action was in response to Eastman Kodak's protest that the 
agency's evaluation of the protester's quote was based on erroneous 
estimates and that Eastman Kodak should have been provided an 
opportunity to quote to the agency's changed needs.  The Corps reports 
that it must now determine its minimum copy needs and the most 
advantageous method of acquiring the copy services before issuing a 
new solicitation.  The Corps does not explain why the decision to take 
corrective action was not made when the agency initially reviewed 
Eastman Kodak's August 8 protest to this Office.  Under these 
circumstances, where the agency did not take corrective action until 
approximately 2 weeks after the report was filed, and in view of the 
agency's lack of objection, we award Eastman Kodak its costs of filing 
and pursuing its protest, including reasonable attorneys' fees.  
Communications-Applied Technology Co., Inc.--Request for Entitlement, 
B-233561.5, Jan. 21, 1994, 94-1 CPD  para.  26; Carl Zeiss, Inc.--Request 
for Declaration of Entitlement to Costs, B-247207.2, Oct. 23, 1992, 
92-2 CPD  para.  274.  The protester should submit its claim for costs, 
detailing and certifying the time expended and costs incurred, 
directly to the agency within 60 days after receipt of this decision.  
4 C.F.R.  sec.  21.8(f)(1).

Comptroller General
of the United States

1. The USAISC contract provides copier equipment, maintenance and 
supplies for a fixed-price monthly rate (regardless of the monthly 
volume) to the USAISC its subordinate commands and field operating 
agencies.  These services are also available to other military and 
civilian agencies provided their annual requirements do not exceed 30 
percent of the estimated annual quantities established for USAISC.