TITLE: B-299738, Camnetics Mfg. Corporation, June 21, 2007
BNUMBER: B-299738
DATE: June 21, 2007
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B-299738, Camnetics Mfg. Corporation, June 21, 2007

   Decision

   Matter of: Camnetics Mfg. Corporation

   File: B-299738

   Date: June 21, 2007

   Mark Reaney for the protester.

   Michael Walters, Esq., and Edward C. Hintz, Esq., Defense Logistics
   Agency, for the agency.

   John L. Formica, Esq., and James A. Spangenberg, Esq., Office of the
   General Counsel, GAO, participated in the preparation of the decision.

   DIGEST

   Agency reasonably rejected protester's quotation offering surplus parts
   where the surplus parts had been determined by the agency to be defective,
   and the protester did not show that this determination was unreasonable.

   DECISION

   Camnetics Mfg. Corporation protests the rejection of its quotation and the
   issuance of a purchase order to Pave Technology Company under request for
   quotations (RFQ) No. SPO900-06-Q-0282, issued by the Defense Logistics
   Agency (DLA), Department of Defense (DOD), for external fuel tank
   disconnect receptacles for aircraft.

   We deny the protest.

   The RFQ sought quotations for 42 fuel tank receptacles. The solicitation
   stated that a purchase order for the items would be issued to the vendor
   submitting the quotation that conforms to the terms of the solicitation,
   is technically acceptable, and represents the best value to the agency
   based upon the evaluation factors of past performance, offered delivery,
   and price. RFQ at 11-12. Vendors were informed that the receptacles were
   "critical application item[s]," and identified Northrup Grumman Systems
   Corporation and Simmonds Precision Products, Inc. as the only approved
   sources for the receptacles. The solicitation also provided the commercial
   and government entity (CAGE) codes for Northrup Grumman and Simmonds, as
   well as each firm's part number for the receptacles. Id. at 2. The RFQ
   provided that the agency would consider quotations of former government
   surplus property, provided the vendor supplied with its quotation detailed
   information relating to the manufacturer of the receptacles, and how the
   vendor obtained the parts. Id. at 6.

   The agency received 11 quotations, including those of Pave and Camnetics,
   in response to the RFQ. Camnetics' quotation provided that it was offering
   surplus receptacles, and identified the receptacles by listing the CAGE
   code for Pave and the part number for Northrup Grumman receptacles. Agency
   Report (AR), Tab 4, Camnetics Quotation, at 2. The agency found based upon
   the CAGE code and part numbers provided in Camnetics' quotation that
   Camnetics was not offering an approved item, and "removed Camnetics from
   consideration." AR, Tab 5, Contract Specialist's Declaration.

   The agency issued a purchase order to Pave, and Camnetics, which had
   quoted lower unit and total prices for the receptacles, filed a protest
   with the agency challenging the agency's decision. The agency found that
   Pave, which had quoted a receptacle it manufactured, had not offered an
   approved part. The agency then informed Pave and Camnetics that it had
   issued a stop-work order in connection with Pave's purchase order, and
   according to the agency, it then "began the process of getting" the Pave
   part approved. Contracting Officer's Statement at 2.

   Final approval of Pave's receptacles was granted, and the agency modified
   the purchase order with Pave to provide that Pave was an approved source
   for the receptacles and list the Pave receptacles by part number. Shortly
   thereafter, Camnetics filed this protest with our Office, arguing that the
   purchase order should have been issued to it given that it "was offering
   the exact parts" as Pave at a lower price. Protest at 1. That is,
   Camnetics' quotation offered surplus receptacles that had been
   manufactured by Pave. The protester points out that it has provided the
   same receptacles as those offered here under a recent purchase order with
   DLA, as well as with regard to two recent contracts with another DOD
   entity. Protest at 2; Protester's Comments at 2.

   By way of background, the agency explains that the receptacles perform two
   important functions, with the first being to "activate a light in the
   cockpit [of the aircraft] to let the pilot know if the external fuel tank
   is present, or if the tank has been jettisoned." AR, Tab 8, Declaration of
   DLA Quality Assurance Specialist, at 1. The receptacle also assists the
   pilot with information regarding the amount of fuel in the external tanks.
   Id. The agency explains that receptacles previously provided by Pave had
   certain problems, and that because of the serious nature of the problems
   (false readings as to the amount of fuel in the tanks and whether the
   tanks remained attached to the aircraft or had been jettisoned), and the
   fact that the provided receptacles could not be repaired, "disposition
   instructions to have the [Pave] receptacles" destroyed were issued. Id. at
   2. The agency states that the "disposal was not carried out," but rather,
   it appeared that the "material was sold to a contractor in 1997" according
   to "the traceability documentation provided." Id. at 3. The agency adds
   that the problems with the receptacles manufactured by Pave were
   subsequently resolved, but that any receptacles manufactured by Pave
   "prior to 1997 are not acceptable." Id. at 4. The agency states that from
   what it has determined, the Pave-manufactured receptacles offered by
   Camnetics here are the defective receptacles erroneously sold as surplus
   in 1997, and accordingly, are unacceptable for use. With regard to the
   purchase order recently issued by DLA to Camnetics for the same
   receptacles, the agency states that "[t]he surplus offer was incorrectly
   approved," and that receptacles will not be issued for use. AR at 3. The
   agency adds that Camnetics has offered the receptacles in response to two
   other DLA solicitations, and that each time "the documents were correctly
   reviewed and the technician recommended the surplus offer be rejected."
   Id.

   In reviewing an agency's technical evaluation of vendor submissions under
   an RFQ, we will not reevaluate the quotations; we will only consider
   whether the agency's evaluation was reasonable and in accord with the
   evaluation criteria listed in the solicitation and applicable procurement
   statutes and regulations. American Recycling Sys., Inc., B-292500, Aug.
   18, 2003, 2003 CPD para. 143 at 4.

   Camnetics states only that "it purchased [the Pave-manufactured
   receptacles] in good faith," and does not deny that the receptacles it is
   offering are the same defective Pave-manufactured receptacles previously
   provided to DLA. The protester contends, however, that it has supplied
   these Pave-manufactured receptacles to another DOD entity and received no
   complaints, and demands that DLA provide "conclusive evidence" that the
   Pave-manufactured receptacles offered by Camnetics "are defective."
   Protester's Comments at 2.

   Although the protester clearly disagrees with the agency's position, we
   believe that the agency has provided, as detailed above, a reasonable
   explanation as to why the surplus receptacles offered by Camnetics are
   unacceptable. In this regard, the agency has provided the declarations of
   agency employees with first-hand knowledge of the defective
   Pave-manufactured receptacles provided prior to 1997. These declarations
   describe in detail the precise nature of the defects, and we have no basis
   to question these declarations based upon this record. Given these
   declarations, and the flight safety critical nature of the receptacles, we
   believe that the agency has provided sufficient evidence as to the
   unacceptability of the particular surplus receptacles offered by
   Camnetics, especially given the absence of evidence from Camnetics that
   would show that the offered surplus items were not those regarded as
   defective by the agency.[1] With regard to the contracts under which
   Camnetics has allegedly provided the surplus receptacles to another DOD
   entity, we note that each procurement stands on its own, and to the extent
   that the receptacles were accepted and put into use by another DOD entity,
   that does not render unreasonable the agency's well-explained
   determination that the surplus receptacles offered here were unacceptable.

   The protest is denied.

   Gary H. Kepplinger
   General Counsel

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   [1] As indicated above, vendors offering surplus items were required to
   provide detailed information relating to the manufacturer of the
   receptacles, and how the vendor obtained the parts.