TITLE:  John D. Lucas Printing Company, B-285730, September 20, 2000
BNUMBER:  B-285730
DATE:  September 20, 2000
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John D. Lucas Printing Company, B-285730, September 20, 2000

Decision

Matter of: John D. Lucas Printing Company

File: B-285730

Date: September 20, 2000

Frederic G. Antoun, Jr., Esq., for the protester.

Jennifer R. Fantuz, Esq., United States Government Printing Office, for the
agency.

C. Douglas McArthur, Esq., and Michael R. Golden, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.

DIGEST

Bidder's failure to acknowledge a material amendment to an invitation for
bids,

which resolved an ambiguity between the product description and the bid
schedule, and which imposed an additional requirement on the contractor,
renders the bid nonresponsive since absent such an acknowledgment the
government's acceptance of the bid would not legally obligate the bidder to
meet the government's needs as identified in the amendment.

DECISION

John D. Lucas Printing Company protests the award of a contract to News
Printing Co., Inc., under invitation for bids (IFB) No. 466-378, issued by
the United States Government Printing Office (GPO) for publications. Lucas
contends that the awardee's bid was nonresponsive because News failed to
acknowledge a material amendment to the solicitation.

We sustain the protest.

As originally issued, the solicitation contained specifications for
publication of a pamphlet, entitled "Medicare and You," for the Health Care
Financing Administration (HCFA). HCFA must, by statute, inform Medicare
beneficiaries of health insurance options by October 15 of each year; HCFA
issues the pamphlet to meet this statutory mandate. 42 U.S.C. sect. 1395w-21
(Supp. IV 1998). Some versions of the pamphlet-"items" under the bid
schedule-include a mail back post card.

The solicitation contained the following specification:

PRODUCT: Six versions of estimated 76, 80 and 84 page publications with
separate wraparound cover saddle-wire stitched. Two versions (Item 1 and
Item 2) require bound in mail back card in only the self-mailer copies.
There are two different post cards. One for Item 1 and a different card for
Item 2 . . . .

IFB at 2.

At the bottom of the page with the above quoted language, a chart provided
information on six items; one column headed "Post Card" contained the word
"YES" opposite items 1, 2, and 6. Id. The "Determination of Award" clause
advised offerors which items and subitems the agency would evaluate in
determining low price. Id. at 10. (There were no other specified evaluation
or selection factors.) For item 6, the agency solicited a price for a
"32-page section, cover with card." Id. The schedule of prices, on the same
page, included the following, with blanks for inserting prices:

                       Item  Item   Item   Item    Item   Item    Add'l
                       1     2      3      4       5      6       1,000

 (1) Basic 32 page                  ____   ____    ____           ____
 section and cover
 w/o card

 (2) Basic 32 page     ____  ____                         ____    ____
 section, cover with
 card

 (3) 32 pages          ____  ____   ____   ____    ____   ____    ____

 (4) 16 pages          ____  ____          ____    ____   ____    ____

 (5) 8 pages                        ____                          ____

 (6) 4 pages           ____         ____   ____                   ____

Id.

This price schedule agreed with the chart on page 2 of the IFB and the
"Determination of Award" clause in requiring a card for Item 6. The product
specifications required a "bound in mail back card" only for Items 1 and 2.

The solicitation established a bid opening date of May 31, 2000. Id. at 1.
News submitted a bid on that date. Shortly before the bid opening time on
May 31, the agency issued amendment No. 1 to the IFB, which corrected the
specifications to state that item 6, as well as items 1 and 2, would require
the "bound in mail back card" in the self-mailer copies and which stated
that there would be three different post cards, "one each for items 1, 2,
and 6." Amend. No. 1, at 1. That amendment also extended, until June 6, the
date on which the agency could issue the first purchase order. Id.
Amendment No. 2, also issued on May 31, added some subitems to the
"Determination of Award" clause. Amend. No. 2, at 1. (The schedule, supra,
already contained blank lines for pricing the subitems.) On June 1, the
agency issued amendment No. 3, which extended the bid opening date to June 5
and the date on which the agency could issue the first purchase order to
June 8.

The agency received seven bids, one of which it rejected as nonresponsive.
In its low priced bid submitted on June 5, News acknowledged amendment
No. 3, but not amendment Nos. 1 and 2. Nevertheless, the contracting officer
determined that the News bid was responsive, essentially because he did not
consider amendment Nos. 1 and 2 to be material. Memorandum from Contracting
Officer to Contract Review Board (June 7, 2000). The contracting officer
considered that amendment No. 1 merely clarified a patent ambiguity in the
solicitation, and that News was bound to perform the contract in accordance
with the amended terms because it had not objected to the ambiguity prior to
the submission of bids. Id. Further, amendment No. 3 had superseded the
provision of amendment No. 1 with regard to extending the initial order
date. Id. Since the News bid contained all of the prices required by
amendment No. 2, the contracting officer determined that that amendment also
was not material. The agency accordingly awarded a contract to News, and
this protest followed.

The protester asserts that the News bid was nonresponsive because that firm
failed to acknowledge two amendments to the solicitation, in particular
amendment No. 1, which clarified the requirement for a mail back card in
item 6. Even assuming that News understood that item 6 required a card, the
protester further argues that there is no evidence that News agreed to a
separate bound in card, as opposed to using one of the cards printed for
items 1 and 2, inserted loosely into the publication. We agree with the
protester.

A bidder's failure to acknowledge a material amendment to an IFB renders the
bid nonresponsive since absent such an acknowledgment the government's
acceptance of the bid would not legally obligate the bidder to meet the
government's needs as identified in the amendment. Specialty Contractors,
Inc., B-258451, Jan. 24, 1995, 95-1 CPD para. 38 at 2. GPO Printing Procurement
Regulation (GPOPPR) XII sect.4.1(d) requires a contracting officer to waive or
to give a bidder the opportunity to cure any deficiency resulting from a
minor informality or irregularity, including the failure to acknowledge
receipt of an amendment if the amendment involves only a matter of form or
is one that has no more than a trivial effect on price, quantity, quality,
or delivery. [1] Where an amendment would have more than a trivial impact on
price, quantity, quality, or delivery, or imposes legal obligations not
contained in the original solicitation, it is generally material. Star Brite
Constr. Co., Inc., B-238428, Apr. 5, 1990, 90-1 CPD para. 373 at 2.

Here, even the agency acknowledges that the unamended IFB contained a patent
ambiguity concerning whether a card was required for item 6. What is also
clear is that, in addition to this ambiguity, the unamended IFB contained no
requirement obligating the contractor to furnish a bound in card for item 6,
which represented the agency's need. Thus, amendment No. 1 imposed an
additional material requirement on the contractor for a bound in card for
item 6, that was clearly not contained in the original solicitation. [2] We
conclude that amendment No. 1 was material and that the agency could not
waive the failure of News to acknowledge this amendment without prejudice to
the other bidders.

The agency argues that by acknowledging amendment No. 3, News constructively
acknowledged the prior amendments and committed itself to comply with them.
Letter from Agency to GAO 7 n.7 (July 26, 2000). Acknowledgment of a later
amendment to a solicitation, however, does not constitute acknowledgment of
prior amendments; a bidder must acknowledge all material amendments. Simco,
Inc., B-222294, Apr. 16, 1986, 86-1 CPD para. 376 at 2. The agency also argues
that since the conflict between the specification and other portions of the
solicitation represented a patent ambiguity in the original solicitation,
regardless of the bidder's interpretation, News was on notice of the
conflict. Letter from Agency to GAO 6 (July 26, 2000). The agency asserts
that News later cannot claim to have been misled by the ambiguity,
concluding that the awardee has waived any right to have the solicitation
interpreted in a manner inconsistent with the agency's actual requirement
that the contractor provide a card for item 6. Id. For that reason, the
agency argues the amendment had no effect on price, quantity, quality, or
delivery, and the amendment imposed no additional legal obligations on News.
Id.

As discussed above, regardless of whether the awardee is committed to
providing a card for item 6, there is nothing to commit News to providing a
bound in card, as opposed to one inserted loosely into the publication.
Presuming that the agency could successfully defend a claim for the
additional cost of providing a card for item 6 on the basis of a patent
ambiguity, until amendment No. 1, there is nothing in the IFB that would
require a bidder to bind the card into the pamphlet. As noted above, the
protester reports, and the agency does not dispute, that this additional
"off-line" step adds substantial cost to the project and alters the normal
printing and binding process. Letter from Protester to GAO 1-2 (Aug. 17,
2000). We also note that when an agency attempts to resolve an ambiguity in
a bid through the issuance of a qualifying amendment in order to avoid
potential litigation, that amendment is material, and the bidder must
acknowledge that amendment, or the agency must reject the bid as
nonresponsive. ACC Constr. Co., Inc., B-277554, Sept. 22, 1997, 97-2 CPD
para. 84 at 4; Air Quality Experts, Inc., B-256444, June 15, 1994, 94-1 CPD
para. 374 at 2. For that reason as well, amendment No. 1 was material.

The protest is sustained. We recommend that GPO terminate the contract
awarded to News, if feasible, and make award to Lucas, if otherwise
appropriate. If termination is not feasible, we recommend that Lucas be
reimbursed its bid preparation costs. We also recommend that Lucas be
reimbursed for the cost of filing and pursuing its protest, including
reasonable attorneys' fees. 4 C.F.R. sect. 21.8(d)(1) (2000). The protester
should submit its certified claim for such costs, detailing the time
expended and the costs incurred, directly to the contracting agency within
60 days of receiving the decision.

Anthony H. Gamboa

Acting General Counsel

Notes

1. GPO, as a legislative branch agency, is not subject to the Federal
Acquisition Regulation (FAR), although the FAR and the GPOPPR, in this
instance, contain similar guidance. See News Printing, Inc., B-274773.2,
Feb. 11, 1997, 97-1 CPD para. 68 at 2; FAR sect. 14.405.

2. The protester explains that the requirement for a bound in card affects
both the method of performance and cost. More specifically, the protester
states:

To supply the postcard as called for in the original specs, the only charge,
in addition to printing, would be the cost of shrinkwrapping, which was
included in the bid price, as there is no line item price for packaging.
However, Amendment [No. 1] required the contractor to bind the same 662,000
cards into Item 6. This operation requires the mechanical insertion of a
heavy weight card into the text pages after the text is printed, but before
saddle stitch binding. This is an extra "off-line" step that adds
substantial cost at John D. Lucas or any printing company.

Letter from Protester to GAO 1 (Aug. 17, 2000).