TITLE: B-296246.2, The Sandi-Sterling Consortium--Costs, September 20, 2005
BNUMBER: B-296246.2
DATE: September 20, 2005
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B-296246.2, The Sandi-Sterling Consortium--Costs, September 20, 2005

   Decision

   Matter of: The  Sandi-Sterling Consortium--Costs

   File: B-296246.2

   Date: September 20, 2005

   J. P. Marinari for the protester.

   Capt. Sunny S. Ahn, Department of the Army, for the agency.

   Jacqueline Maeder, Esq., and John M. Melody, Esq., Office of the General
   Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Where agency proposed corrective action before filing administrative
   report and protest grounds were not clearly meritorious, there is no basis
   for GAO to recommend reimbursement of costs of pursuing the protest.

   DECISION

   The Sandi-Sterling Consortium (SSC) requests that we recommend that it be
   reimbursed the reasonable costs of filing and pursuing its protest
   challenging the award of a contract to Meridian International Center under
   request for proposals (RFP) No. W914NS-05-R-0002, issued by the Department
   of the Army for the establishment of a Partnership in Healthcare Program
   in Iraq, designed to improve the Ministry of Health's ability to staff,
   train, and manage the overall healthcare system.

   We deny the request.

   The RFP, issued November 13, 2004, provided for the award of a 1-year
   contract, with a 6-month option, to the offeror whose proposal was
   determined to represent the "best value" to the government, considering
   price, past performance, and technical plan. After receiving four
   proposals, including SSC's and Meridian's, the agency made award to
   Meridian and notified offerors of the award by letter dated February 10,
   2005. SSC challenged the award in an agency-level protest filed by e-mail
   on February 16, arguing, among other things, that the agency improperly
   failed to issue an amendment communicating to all offerors information
   that had been communicated to SSC, improperly permitted another offeror to
   revise its proposal after the due date for proposals, and improperly
   evaluated SSC's proposal. The protest included a request for a debriefing.
   By letter dated April 7, the agency denied the protest in part and
   dismissed it in part. Thereafter, on April 18, SSC filed a protest in our
   Office, alleging that the specifications outlined in the solicitation were
   defective, that the directions regarding pricing were ambiguous, and that
   the agency improperly evaluated the protester's price and made an improper
   best-value determination. The protester also asserted that the agency
   failed to provide the debriefing it requested in its agency-level protest.

   On May 16, prior to the May 19 due date for its administrative report in
   response to the protest, the agency submitted a dismissal request, arguing
   that concerns about alleged solicitation defects and pricing instructions
   were untimely, that a debriefing was not required, and that SSC's protest
   regarding the best-value determination was vague, and therefore did not
   state a valid basis of protest. By facsimile transmission on May 19, we
   notified the parties that the agency report requirement was suspended
   until further notice pending our consideration of the dismissal request.
   By letter the same day, SSC complained that the agency had denied it the
   right to discovery by denying SSC requested documents, suggesting that the
   protester seek documents under the Freedom of Information Act, and failing
   to provide SSC a debriefing. In its subsequent response to the dismissal
   request, filed on May 25, SSC generally argued that the agency too
   narrowly interpreted its protest, that the Army had a duty to disseminate
   information regarding the solicitation to all prospective offerors, and
   that its concern regarding the best-value determination was not too vague.
   SSC also reasserted that it had been denied its right to discovery. On
   June 2, we advised the parties that we would not dismiss the protest, and
   requested that an agency report, including relevant documents, be filed in
   our Office no later than June 10. Thereafter, by letter dated June 7, the
   Army notified our Office that it was taking corrective action.
   Specifically, the Army stated that it would terminate the award to
   Meridian, revise/clarify the evaluation criteria, and resolicit the
   requirement. We dismissed the protest as academic on June 13. SSC now
   requests that we recommend that it be reimbursed its protest costs.

   Under our Bid Protest Regulations, 4 C.F.R. sect. 21.8(e) (2005), we may
   recommend that a protester be reimbursed the costs of filing and pursuing
   a protest where the contracting agency decides to take corrective action
   in response to the protest. We will make such a recommendation, however,
   only where the agency unduly delayed taking corrective action in the face
   of a clearly meritorious protest, thereby causing a protester to expend
   unnecessary time and resources to make further use of the protest process
   in order to obtain relief. Information Ventures, Inc.--Costs, B-294567.2,
   Nov. 16, 2004, 2004 CPD para. 234 at 2. We will not recommend
   reimbursement of protest costs where, under the facts and circumstances of
   a given case, the agency has taken reasonably prompt corrective action.
   TRS Research and Transport Planning and Servs., Inc.--Costs, B-290122.2,
   July 25, 2002, 2002 CPD para. 126 at 2.

   In general, if an agency takes corrective action in response to a protest
   by the due date for its report in response to the protest, we consider
   such action to be prompt and will not recommend reimbursement of protest
   costs. Id.; HSQ Tech.--Costs, B-276050.2, June 25, 1997, 97-1 CPD para.
   228 at 2. This is the case even where the report due date was extended; in
   such circumstances, although the corrective action may have been somewhat
   delayed relative to the original report date, we do not consider this to
   be an undue delay, since it did not result in the protester's being put to
   the time and expense of filing comments in response to the report. TRS
   Research and Transport Planning and Servs., Inc.--Costs, supra. Here, the
   agency proposed corrective action prior to the extended report due date,
   and neither its report nor the protester's comments were filed. Thus, SSC
   was not required to expend additional time or resources preparing report
   comments, and the purpose of section 21.8(e) of our Regulations has been
   served. Under these circumstances, we consider the corrective action to be
   prompt; it follows that there is no basis for recommending reimbursement
   of SSC's protest costs.

   In any case, we cannot say that SSC's protest was clearly meritorious. We
   consider a protest to be clearly meritorious when the agency lacked a
   defensible legal position; that is, that the protest does not involve a
   close question. Information Ventures, Inc-- Costs, supra, at 2. The mere
   fact that an agency decided to take corrective action does not establish
   that a statute or regulation was violated. Id. Here, deciding the merits
   of SSC's protest would have required development of the protest
   record--including a complete agency report and the protester's comments on
   the report--and we would have had to conduct substantial further legal
   analysis. This being the case, we have no basis to find that SSC's protest
   was clearly meritorious. Career Quest, a division of Syllan Careers,
   Inc.--Costs, B-293435.5, Apr. 13, 2005, 2005 CPD para. 79 at 3.

   The request that we recommend reimbursement of SSC's protest costs is
   denied.

   Anthony H. Gamboa

   General Counsel