TITLE:  e-LYNXX Corporation, B-292761, December 3, 2003
BNUMBER:  B-292761
DATE:  December 3, 2003
**********************************************************************
e-LYNXX Corporation, B-292761, December 3, 2003

   Decision
    
    
Matter of:   e-LYNXX Corporation
    
File:            B-292761
    
Date:              December 3, 2003
    
Anthony W. Hawks, Esq., for the protester.
Roy E. Potter, Esq., and Jennifer R. Seifert, Esq., Government Printing
Office, for the agency.
Guy R. Pietrovito, Esq., and James A. Spangenberg, Esq., Office of the
General Counsel, GAO, participated in the preparation of the decision.
DIGEST
    
Under a request for quotations, issued under simplified acquisition
procedures, under which oral presentations constituted the vendors*
technical submissions and which provided for award based upon a
price/technical tradeoff, protest challenging source selection decision is
sustained, where the contracting officer*s selection of the higher-priced,
higher-rated quotation reflected a failure to meaningful consider price,
given that the price/technical tradeoff was based primarily upon a
technical consideration which the contracting officer testified he did not
understand and for which he obtained no advice.
DECISION
    

   e-LYNXX Corporation protests the issuance of an order to Noosh, Inc. under
request for quotations (RFQ) No. 5170903, issued by the Government
Printing Office (GPO) for a contractor-hosted, web-based printing
procurement system. e-LYNXX challenges the agency*s evaluation of its
technical submission and the contracting officer*s source selection
decision.
    

   We sustain the protest.
    
In an effort to reduce printing costs to the federal government and to
ensure permanent access to non-classified government publications, GPO and
the Office of Management and Budget (OMB) have entered into a *Compact*
under which both agencies would seek to develop a mechanism that would
allow federal agencies to place printing orders directly with print
vendors through an on-line system operated by GPO.  Accordingly, GPO and
OMB agreed that by October 1, 2003 GPO would develop a *demonstration
print procurement contract,* utilizing the Internet for ordering and
invoicing, for a federal department or agency selected by OMB.[1]  The
Compact provided that GPO would *register and qualify printers for
participation in the contract* and that *[a]ny registered printer in the
country would be free to submit a price quote on any job placed in the
system.*  The Compact contemplated that the demonstration project would
begin in fiscal year 2004, and the competitive procurement process would
be deployed throughout the government in fiscal year 2005.
    
Pursuant to its agreement in the Compact, GPO issued the RFQ on July 10,
2003, as a simplified acquisition under GPO*s Materials Management
Acquisition Regulations (MMAR) (GPO Publication 805.33), seeking
quotations for a demonstration pilot program with a single buying agency
to be deployed by October 1, 2003 for 1 year.  The Compact between GPO and
OMB was attached to the RFQ.  Vendors were informed that GPO intended *to
purchase an existing web-based e-commerce solution with necessary
modifications to accomplish the requirements* identified in the RFQ, and
that GPO intended to make a system available to all federal agencies by
October 1, 2004.  The RFQ also provided that GPO expected that as many as
1,000 printing firms could participate in the pilot program and that the
*number of individual orders placed by the pilot agency [would] also be in
the 1,000 range.*  RFQ at 3. 
    
The RFQ identified 25 *requirements* that *the proposed solution should
provide,* including the following:
    
1.      An online process for vendors to register and update information
identifying products they were capable and willing to produce.
2.      Simple, clear, easy-to-use interfaces for vendors, GPO, and
ordering agencies.
3.      Ability to create RFQs using clean, simple  and intuitive
interfaces with the ability to include attachments in a variety of
formats.
4.      Ability to notify selected vendors of availability of RFQs (or
provide RFQ to selected vendors) and to *simultaneously post RFQs to web
site available to all registered vendors.  Posting site will provide
sorting capabilities to aid vendors in identifying orders that they would
be interested in quoting on (i.e., product categories).  Small dollar
orders (those under $2,500) may be sent directly to a single vendor
without posting.*

   5.      Ability to select from a large number of vendors those who are
capable of providing services requested by describing required product in
increasing detail.
    
RFQ at 3-4.
    
Vendors were informed that award would be made on a *best value* basis, in
which technical excellence would be significantly more important than
price.  The following technical evaluation factors were identified:  (1)
solution description (how well the proposed product/solution meets the
stated requirements); (2) ease of use; (3) implementation schedule; (4)
features and benefits (i.e., user interfaces, help screens, subject matter
expertise, learning curves, and other features and benefits); and (5)
prior experience (*[p]rior experience with the proposed product/solution
in the Federal Government*).  RFQ at 5.
    
The RFQ provided that the technical evaluation of a vendor*s system would
be based upon the vendor*s oral presentation of its system.  With respect
to price, vendors were directed *to propose a method of pricing this
requirement as a firm fixed price contract.*  Id.
    
GPO provided the RFQ to three vendors, including Noosh and e-LYNXX, each
of which provided a price quotation and presentation slides and made an
oral presentation of its proposed system.  Each vendor provided a 2-hour
presentation to the agency*s evaluators and others (including the
contracting officer), after which each vendor answered questions from the
agency.  Hearing Transcript (Tr.) at 211-12; 252-53.  Each of the agency*s
four evaluators recorded their impressions from the oral presentations in
handwritten notes, which the evaluators subsequently used to prepare
individual, typed evaluation memoranda.[2]  Tr. at 17, 19, 142, 212;
Agency Report, Tabs 2, 3, 4, and 5, Evaluation Memoranda.  Subsequently,
the evaluators met to discuss the firms* oral presentations and reach a
consensus evaluation judgment.  Agency Report, Tab 6, Evaluation Report.
    
At the time of the oral presentation, the evaluators found that none of
the vendors* quoted systems satisfied all of the RFQ*s technical
*requirements.*  Tr. at 42.  However, the evaluators found that each
vendor demonstrated a system that, with modifications, could meet the
agency*s needs.  Tr. at 175-76.  The evaluators concluded that Noosh had
quoted the technically superior solution, and that e‑LYNXX*s quoted
system was the lowest technically rated of the three quotations.  Agency
Report, Tab 6, Evaluation Report.
    
The evaluators* assessment of Noosh*s technical superiority was based,
among other things, on the evaluators* judgment that Noosh*s quoted system
was the easiest to use and offered the most flexible architecture, robust
reporting capability, and intuitive audit trail, and that Noosh had the
most prior experience within the federal government with its quoted
product/solution.  Id.  The evaluators noted that although, as presented,
Noosh*s quoted solution (described as the Noosh 5 software) did not
satisfy the requirements for on-line vendor registration and posting of
RFQs to a website available to all registered vendors (the so called *open
posting* requirement),[3] Noosh promised to modify its product to provide
these features.  Tr. at 42, 231.  In this regard, one of the evaluators
noted that a prior version of Noosh*s software (Noosh 4) provided these
features and that modifying the current version of Noosh*s software would
be *fairly easy.*[4]  Agency Report, Tab 5, Evaluation Memorandum, at 1.
    
With respect to e-LYNXX*s quoted product, the *printLYNXX* system, the
evaluators found that although e‑LYNXX*s system offered a number of
strengths, there were also a number of weaknesses.  For example, the
evaluators all noted that e-LYNXX*s system did not provide for posting of
RFQs to a website available to all registered vendors and that e-LYNXX did
not appear willing to modify its system to provide for such open posting. 
See Tr. at 42, 149-50, 217, 219.  This was considered to be a significant
weakness by the evaluators, given that the Compact required GPO to adopt a
procedure under which any registered printer would be allowed to quote on
any job placed in the system.
    
Following the oral presentations, on July 31, GPO requested *best and
final* price quotations from the vendors.  Specifically, vendors were
asked to provide a fixed price for three line items:  (1) modifications
associated *with setting up Web Portal per Oral Presentations*; (2) 1-year
period based on utilizing a single government agency processing 1,000
orders for a dollar amount of $4 million; and (3) an option year based
upon the same quantities as the base year.
    
Noosh*s and e-LYNXX offered the following final price quotations:[5]
    

   +------------------------------------------------------------------------+
|                         |Noosh                |e-LYNXX                 |
|-------------------------+---------------------+------------------------|
|Modifications            |$3,500               |0                       |
|-------------------------+---------------------+------------------------|
|Base year                |$95,000              |$32,700[6]              |
|-------------------------+---------------------+------------------------|
|Option year              |$95,000              |$25,200                 |
+------------------------------------------------------------------------+

    
The evaluators* consensus evaluation judgment that Noosh offered the
technically superior quotation (Agency Report, Tab 6) and the typed
evaluation memoranda of each evaluator (Agency Report, Tabs 2-5) were
provided to the contracting officer for his review.  Tr. at 361‑62. 
The contracting officer adopted the evaluators* technical findings. 
Tr. at 410. 
    
The contracting officer then performed a price/technical tradeoff analysis
(which was not contemporaneously documented) and determined that Noosh*s
quotation represented the best value to the government.  In this respect,
the contracting officer stated that he believed that Noosh offered the
most complete solution *mainly because [Noosh] was willing to accommodate
the open posting requirements as identified in the RFQ,* as opposed to
e-LYNXX, which did not offer to satisfy the open posting requirement.[7] 
Agency Report, Tab 14, Declaration of Contracting Officer (Sept. 18,
2003).  The contracting officer identified a number of other factors he
considered in determining that Noosh*s quotation was the best value,
despite e‑LYNXX*s substantially lower price, including that Noosh*s
system was easier to use and offered additional desired features that were
not required by the RFQ.[8]
    
GPO issued an order to Noosh, and this protest followed.  Noosh*s
performance has not been stayed based upon the agency*s written
determination that the best interests of the United States would not
permit the agency to await our decision in this matter.
    
Simplified acquisition procedures are designed to, among other things,
reduce administrative costs, promote efficiency and economy in
contracting, and avoid unnecessary burdens for agencies and contractors. 
See MMAR S: 13.003; Sawtooth Enters., Inc., B‑281218, Dec. 7, 1998,
98-2 CPD P: 139 at 3.  Our Office reviews allegations of improper agency
actions in conducting simplified acquisitions to ensure that the
procurements are conducted consistent with a concern for fair and
equitable competition and with the terms of the solicitation.  Nunez &
Assocs., B‑258666, Feb. 10, 1995, 95-1 CPD P: 62 at 2.
    
e-LYNXX challenges numerous aspects of GPO*s evaluation and selection of
Noosh*s quotation.  We conducted a hearing to resolve the parties* dispute
as to what e‑LYNXX orally presented and what was considered by the
contracting officer in his source selection decision.  As explained more
fully below, from our review of the record, including the hearing
testimony and parties* arguments, we find unreasonable the price/technical
tradeoff analysis performed by the contracting officer to determine that
Noosh*s higher-rated, higher-priced quotation reflected the best value to
the government.
    
In performing the price/technical tradeoff analysis, the contracting
officer adopted the technical evaluation judgments of the agency*s
evaluators.  Tr. at 410.  That is, although the contracting officer
attended all of the oral presentations, see Tr. at 343, he did not
independently assess the vendors* systems and, in fact, testified that he
did not have the technical expertise to perform such an assessment.  Tr.
at 410.   The contracting officer also testified that he had no
conversations with any of the evaluators or anyone else regarding the
technical evaluation judgments, but relied upon the evaluators* typed
evaluation summaries (Agency Report, Tabs 2, 3, 4, and 5) and consensus
evaluation report (Agency Report, Tab 6).  Tr. at 361-62.
    
After accepting the evaluators* judgment that Noosh*s quotation was
technically superior to e-LYNXX*s, the contracting officer considered the
firms* best and final pricing.[9]  The contracting officer recognized that
e-LYNXX had quoted a substantially lower price than Noosh ($32,700 as
compared to $98,500, respectively).[10]  Tr. at 411.  However, he
concluded that Noosh*s technical superiority outweighed e-LYNXX*s price
advantage primarily because Noosh promised to modify its quoted system to
provide for open posting and the evaluators found that e-LYNXX would not
meet this requirement.[11]  Tr. at 362-64, 409, 411-12, 414; Agency
Report, Tab 14, Declaration of Contracting Officer, at 1.  When asked
during the hearing to articulate why Noosh*s technical superiority was
worth its associated price premium, the contracting officer was unable to
provide a cogent explanation supporting his tradeoff.  In fact, despite
stating that e‑LYNXX*s alleged inability to provide open posting
played a significant role in his decision, the contracting officer
admitted that the open posting requirement *meant absolutely nothing* to
him and that he did not know what open posting was.  Tr. at 374, 414.
    
In a best value procurement, it is the function of the source selection
authority (here, the contracting officer) to perform a tradeoff between
price and non-price factors, that is, to determine whether one proposal*s
superiority under the non-price factor is worth a higher price.  Even
where, as here, price is stated to be of less importance than the
non-price factors, an agency must meaningfully consider cost or price to
the government in making its source selection decision.  See S. J. Thomas
Co., Inc., B‑283192, Oct. 20, 1999, 99-2 CPD P: 73 at 3.  Although
the price/technical tradeoff process allows an agency to accept other than
the lowest-priced submission, the perceived benefit of the higher-priced
alternative must merit the additional price.  See MMAR S: 15.101-1(c);[12]
Beautify Professional Servs. Corp., B-291954.3, Oct. 6, 2003, 2003 CPD P:
__ at 5.
    
Here, we find that the contracting officer failed to give any meaningful
consideration to e-LYNXX*s substantially lower quotation price, given his
inability to explain why Noosh*s superiority was worth the more than 65
percent higher price.  More specifically, we question whether the
contracting officer had a sufficient basis to perform a rational
price/technical tradeoff where he testified that the open posting
requirement was a key consideration in his analysis but that he did not
understand the requirement or obtain any advice concerning it from anyone
that did.  We fail to see how the contracting officer can assign value for
something he admittedly does not understand and for which he did not seek
any advice, and we sustain e-LYNXX*s protest on this basis.
    
e-LYNXX also complains that GPO misevaluated the protester*s quoted
system, as presented at the oral presentation.  In particular, e-LYNXX
argues that it demonstrated that its system would satisfy the open posting
requirement.  In this regard, e-LYNXX states that it informed GPO at the
oral presentation that the firm*s software was modifiable to allow any
form of posting that the agency wished.  e‑LYNXX also argues that it
was misled by the agency at the oral presentation with respect to the
requirement to post RFQs to a web site available to all registered
vendors, when it was informed by a GPO observer that this requirement
concerned all registered vendors doing business with GPO (roughly, 15,000
vendors); GPO asserts, however, that this solicitation requirement
actually concerns only vendors that have registered to participate in this
pilot project.
    
As explained below, we have been unable to determine from this record what
e‑Lynxx offered at its oral presentation, despite conducting a
hearing to receive testimony from three of the agency*s four evaluators,
the contracting officer, and the protester*s presenter.  The record is
replete with conflicting evidence, statements and testimony concerning
what e-LYNXX presented orally to the GPO evaluators regarding the open
posting requirement.
    
Although we recognize that this procurement was conducted under GPO*s
simplified acquisition procedures, it is a fundamental principle of
government accountability that an agency be able to produce a sufficient
record to allow for a meaningful review where its procurement actions are
challenged.  Checchi and Co. Consulting, Inc., B-285777, Oct. 10, 2000,
2001 CPD P: 132 at 6.  In this regard, in reviewing agency*s procurement
actions, we do not limit our review to contemporaneous evidence but
consider, as appropriate, hearing testimony and the parties* arguments and
explanations.  See Southwestern Marine, Inc.; Am. Sys. Eng*g Corp.,
B-265865.3, B-265865.4, Jan. 23, 1996, 96-1 CPD P: 56 at 10.
    
Here, e-LYNXX*s oral presentation slides provide that the printLYNXX
system *enables RFQs to be electronically submitted to posting sources.* 
Protest, exh. 1, Oral Presentation Slides, at 26.  e-LYNXX*s presenter
testified that at the oral presentation he explained to GPO that the
protester*s system could satisfy the open posting requirement in numerous
ways and that printLYNXX could provide for posting to any group, large or
small, of vendors that the agency wished.  See Tr. at 329-30.  The e-LYNXX
presenter also testified that he was never informed that GPO did not view
the printLYNXX system as satisfying the open posting requirement.  Tr. at
298.  On the other hand, all of the evaluators* contemporaneous oral
presentation notes and later evaluation memoranda reflect that e-LYNXX did
not demonstrate at the oral presentation that its system would satisfy the
posting requirement and that e-LYNXX appeared unwilling to modify its
system to provide this function in the fashion requested by GPO.  See,
e.g., Agency Reports, Tabs 2-5.  In addition, three of the four evaluators
testified at the hearing, and all three testified that e‑LYNXX*s
presenter did not demonstrate or state that the printLYNXX could provide
for open posting of RFQs to a website available to vendors registered in
the pilot program.[13]  Tr. at 36-37, 148-50, 219-23. 
    
Adding to the confusion surrounding e-Lynxx*s oral presentation are the
protester*s arguments suggesting that it was misled by GPO regarding the
pool of registered vendors that would be eligible to access the web site
to which RFQs were to be posted.  The e-LYNXX presenter testified that he
was informed by someone at the oral presentation (apparently an observer
and not an evaluator) that the pool of registered vendors for the posting
requirement would be on the order of 12,000 to 15,000 vendors, which is
roughly all the vendors currently registered with GPO.  This testimony,
which is unrebutted in the record, suggests that e-LYNXX*s statement at
the oral presentation that it could post to a website open to all GPO
vendors (which GPO has stated would not satisfy the open posting
requirement) was made to satisfy GPO*s perceived desires.  That is,
contrary to GPO*s statements that it desired a web site restricted to the
vendors registered for this program, e-Lynxx states that it was led to
believe at the oral presentation that the RFQ requirement actually
provided for posting to a website available to the 12,000 to 15,000
registered GPO vendors.  On the other hand, this testimony appears to be
inconsistent with the statement in the RFQ that GPO anticipated that only
1,000 vendors would participate in the pilot program.
    
In short, despite receiving hearing testimony and the parties*
post-hearing arguments, we are unable to determine from our review of the
hearing testimony and the parties* arguments and explanations what was
offered by e-LYNXX at its oral presentation.  However, given our finding
above that the agency*s price/technical tradeoff analysis was unreasonable
and that e-LYNXX*s protest should be sustained on that basis, we need not
resolve this conflict.[14]
    
We sustain the protest.
    
As noted above, GPO overrode the statutorily required stay of performance
triggered by e-LYNXX*s protest based upon a finding that continued
performance would be in the best interests of the government.  In such
circumstances, the Competition in Contracting Act of 1984 requires our
Office to make our recommendation without regard to any cost or disruption
from terminating, recompeting, or reawarding the contract.  31 U.S.C. S:
3554 (b)(2) (2000).
    
We recommend that the agency either conduct new oral presentations in this
procurement, particularly given that the evaluators* testimony reflected
an understandable inability to recall the oral presentations with
specificity,[15] or obtain written submissions.  The agency should then
conduct a new technical evaluation of the firms* quotations and make a new
source selection decision.  If a vendor other than Noosh is selected for
award, we recommend that GPO terminate Noosh*s order and award an order to
that other firm, if it is otherwise appropriate.  We also recommend that
the protester be reimbursed its costs of filing and pursuing the protest. 
4 C.F.R. S: 21.8(d)(1) (2003).  The protester should submit its certified
claim for such costs, detailing the time expended and costs incurred,
directly with the GPO within 60 days of receiving this decision.  4 C.F.R.
S: 21.8(f)(1).
    
Anthony H. Gamboa
General Counsel
    
    

   ------------------------

   [1] Subsequent to the issuance of the RFQ, OMB selected the Department of
Labor as the buying agency in this pilot program.
[2] Other than the evaluators* contemporaneous notes, the oral
presentations were not recorded.
[3] GPO states that this requirement was intended to provide for posting
to a web site available only to vendors registered to participate in the
pilot program and not to other vendors.
[4] The record does not show exactly what Noosh promised or how its system
would comply with the open posting requirement.
[5] The third vendor*s price quotation exceeded the $100,000 simplified
acquisition threshold. 
[6] e-LYNXX included a notation on its best and final quotation that its
base year price of $32,700, included a one-time deployment fee of $7,500.
[7] In his hearing testimony, the contracting officer testified that he
viewed e-LYNXX*s failure to satisfy the RFQ*s posting requirement as
rendering the firm*s quotation *unqualified.*  See Tr. at 411-13.  In its
post-hearing comments, GPO argues that e‑LYNXX*s *refusal to satisfy
this requirement made the offer unacceptable.*  GPO*s Post-Hearing
Comments at 33 n.12.  This post-hearing contention by GPO is inconsistent
with the agency*s report, in which the agency stated that e-LYNXX was not
found unacceptable, see, e.g., Agency Report at 8, and the contemporaneous
evaluation record.  See Agency Report, Tab 6, Evaluation Report, which
stated that each vendor *demonstrated a system which appeared to have the
ability to satisfy the requirements expected.*  Moreover, this
post-protest judgment by the contracting officer is not consistent with
his testimony that he did know or understand the open posting requirement
and that he simply adopted the evaluators* technical judgment.  See Tr. at
410.
[8] Vendors* option year prices were not evaluated and Noosh*s order does
not include an option year.
[9] The price quotations were provided only to the contracting officer,
and were not seen by the evaluators.
[10] The contracting officer testified that he considered e-LYNXX*s
fixed-price quotation to be *underpriced.*  Tr. at 412.
[11] Although the contracting officer identified a number of other things
which he believed justified the superiority of Noosh*s quotation over
e-LYNXX*s (for example, Noosh*s system appeared to be easier to use while
e-LYNXX*s system provided for a less desirable restrictive vendor
registration), the record shows that the primary basis for the contracting
officer*s price/technical tradeoff judgment was e-LYNXX*s alleged failure
to promise a system that would post solicitations to a web site available
only to vendors registered in this pilot program, that is, the open
posting requirement.
[12] Like the Federal Acquisition Regulation (FAR), GPO*s regulations
allow the agency in a simplified acquisition to use procedures provided
for sealed bidding and negotiation.  See MMAR S: 13.106-2(b).  Here, the
RFQ provided for the use of cost/technical tradeoff procedures from MMAR
Part 15, which are comparable to the procedures contained in FAR part 15.
[13] Witnesses were sequestered during the hearing.
[14] e-LYNXX also objected to several other aspects of GPO*s oral
presentation evaluation of the protester*s system, including that the
printLYNXX system reflected a restrictive vendor registration and an
inflexible method of issuing RFQs (that is, that there were too many
fields that must be completed to issue an RFQ).  Given our recommendation
to reopen the competition and make a new source selection decision, we do
not address these other protest allegations or e-LYNXX*s objection to the
agency*s prior experience and price reasonableness evaluations.
[15] In conducting these new oral presentations, it would appear prudent
for the agency to keep a more formal record of the oral presentations,
upon which it will base its technical evaluation.