TITLE: B-310273.2, Sysorex Federal, Inc.--Costs, March 27, 2008
BNUMBER: B-310273.2
DATE: March 27, 2008
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B-310273.2, Sysorex Federal, Inc.--Costs, March 27, 2008
DOCUMENT FOR PUBLIC RELEASE
The decision issued on the date below was subject to a GAO Protective
Order. This redacted version has been approved for public release.
Decision
Matter of: Sysorex Federal, Inc.--Costs
File: B-310273.2
Date: March 27, 2008
David S. Cohen, Esq., and John J. O'Brien, Esq., Cohen Mohr LLP, for the
requester.
Sherry Kinland Kaswell, Esq., Department of the Interior, and Paul Oman,
Esq., U.S. Customs and Border Protection, for the agency.
David A. Ashen, Esq., and John M. Melody, Esq., Office of the General
Counsel, GAO, participated in the preparation of the decision.
DIGEST
Reimbursement of costs of filing and pursuing a protest insofar as they
relate to challenge to evaluation of proposed handheld license plate
reader systems is recommended where a reasonable agency inquiry into
initial protest allegations would have shown facts disclosing absence of a
defensible legal basis for finding awardee's solution compliant with the
solicitation specifications, but agency delayed taking corrective action
until after submission of the agency report.
DECISION
Sysorex Federal, Inc. requests that we recommend that the firm be
reimbursed the costs of filing and pursuing its protest challenging the
award of a contract to Perceptics, LLC, under request for proposals (RFP)
No. 0407RP66155, issued by the Department of the Interior, GovWorks, on
behalf of Customs and Border Protection (CBP), for license plate reader
(LPR) systems. Sysorex challenged the evaluation of proposals and conduct
of the procurement.
We grant the request.
The solicitation provided for award of a primarily fixed-price,
level-of-effort contract to produce, install, warrant and maintain a
minimum of 54 and a maximum of 770 LPR systems at various CBP facilities,
primarily points of entry at U.S. borders. The LPR systems ensure that all
vehicles crossing U.S. land borders at points of entry have their license
plates automatically queried against law enforcement databases. Several
types and configurations of LPRs were specified in the solicitation
statement of work (SOW), including: fixed permanent installations at point
of entry traffic lanes for commercial vehicles; fixed permanent
installations at point of entry traffic lanes for passenger vehicles;
"self-contained" mobile units capable of being deployed (within 2 hours)
with an approximation of a typical lane layout; and handheld wireless
devices "capable of acting as a fully functioning LPR system." SOW
sections C.3.1.5.2, C.3.1.4. Award was to be made to the offeror whose
proposal represented the "best value" when evaluated against six criteria:
key personnel, technical approach, management approach, past experience/
performance, transition plan, and price.
Based on its evaluation of the initial proposals received in response to
the RFP and oral presentations made by offerors, Interior initially
eliminated Sysorex's proposal from the competition prior to the live test
demonstration provided for under the original solicitation. However, the
agency subsequently reconsidered its decision and reinstated Sysorex in
the competition, amended the solicitation to delete the live test
demonstration, and opened discussions with Sysorex, Perceptics, and the
other firms whose proposals were included in the competitive range.
Based upon its evaluation of the final proposal revisions (FPR) submitted
at the end of discussions, Interior determined that Perceptics' proposal
represented the best value. While Sysorex's evaluated price ($1,167,705)
was significantly lower than Perceptics' ($3,940,954), Perceptics'
proposal was rated very good for overall technical merit, while Sysorex's
was rated only satisfactory. In this regard, the source selection decision
generally indicated that the technology proposed by Sysorex "is not well
suited to the environment in which CBP operates," and specifically
observed that Sysorex's handheld solution "compromises officer safety."
Source Selection Decision at 8. Sysorex's proposed handheld system was
comprised of [REDACTED]. Sysorex FPR at I-10 to I-11. As the agency made
clear in the detailed technical evaluation and in the debriefing
subsequently furnished Sysorex after the award to Perceptics, Sysorex's
handheld solution was determined not to work in the intended environment
because it would require officers to carry a [REDACTED] in addition to the
bullet-proof vest, gun belt with weapon, additional ammunition clips,
baton, handcuffs, and pepper spray officers already carry. FPR Technical
Evaluation at 2; Sysorex Debriefing at 3. In contrast, Perceptics proposed
as its handheld solution to use a [REDACTED] handheld device that would
[REDACTED]. Perceptics FPR at I-15 to I-17.
Upon learning of the award to Perceptics, and after being debriefed,
Sysorex filed a protest with our Office. In its initial protest filings,
Sysorex challenged the award on the basis that Interior had: failed to
conduct meaningful discussions; failed to evaluate price proposals in
accordance with the solicitation; treated the offerors unequally in the
technical evaluation; and otherwise failed to reasonably evaluate a number
of sections of its technical proposal, including key personnel, handheld
solution, reading vanity license plates, past experience and performance,
transition plan, network monitoring capabilities, and approach to
addressing changes in state license plate designs. With regard to the
agency's criticism of its handheld solution, Sysorex asserted that "[t]he
requirements of the solicitation drove the equipment that was required for
the handheld solution. All offerors would be required to propose a similar
suite of equipment to that proposed by Sysorex and the border officers
would use it in a similar fashion." Sysorex Amended Protest, Sept. 17,
2007, at 18; Sysorex Protest, Sept. 11, 2007, at 17. Sysorex concluded
that, since the two handheld solutions therefore must have been similar,
downgrading Sysorex's solution but not Perceptics' was unreasonable.
In its October 15 report, Interior maintained that it had reasonably
evaluated the proposals and requested that we deny Sysorex's protest in
its entirety. Regarding Sysorex's challenge to the agency's assessment
that Sysorex's handheld solution would not work in the environment in
which CBP officers operate, Interior asserted that:
Sysorex maintains that every offeror had to propose a suite of equipment
similar to its own [REDACTED] system, which consists of a [REDACTED]. A
review of Perceptics' technical proposal demonstrates the fallacy of
this assertion. Perceptics proposed a true handheld solution, consisting
of a [REDACTED] that accomplishes all of the functions of Sysorex's
[REDACTED] "handheld" system. Moreover, Sysorex's argument indicates its
lack of familiarity with the state of the art as represented in the
proposals of its competitors.
Agency Report, Oct. 15, 2007, at 8. The agency included among the
documents furnished with the report a copy of Perceptics' proposal.
In its October 22 supplemental protest and October 25 comments on the
agency report, Sysorex pointed out that, under the solicitation, all types
of LPR systems, including the handheld system, were required to image
license plates on vehicles moving at speeds up to 60 miles per hour, with
95 percent accuracy, while handheld LPRs also were required to include a
battery with an 8-hour life. SOW sections 3.1.5.2, C.4.4, C.4.6.3. Sysorex
noted that, in Perceptics' handheld solution, CBP officers would carry
[REDACTED] as those that Perceptics proposed for its fixed and mobile LPR
systems; thus, according to Perceptics' FPR, "[REDACTED]." Perceptics FPR
at I-6 to I-27, IX-2. Sysorex asserted that Perceptics' handheld PDA
solution therefore did not meet the 60 miles per hour with 95 percent
accuracy requirement. Sysorex also raised an additional protest allegation
regarding Perceptics' proposed approach to commercial vehicles.
Specifically, Sysorex noted that, while the SOW required that each LPR
system "transmit the alphanumerics and state/province of origin for each
plate on both the front and rear of the commercial vehicle . . . for at
least 95% of all commercial vehicles which pass through the lane," SOW
sect. C.4.2, Perceptics' FPR stated that its system would correctly read
both the alphanumerics and state/province of origin "[REDACTED]."
Perceptics FPR at I-23. Sysorex argued that this statement fell short of
meeting the 95 percent requirement.
On November 1, Interior advised our Office that it had determined to take
corrective action in response to the grounds raised in Sysorex's second,
amended protest filed on October 22. Interior stated that it would amend
the solicitation, request new FPRs, suspend performance of all but a
limited portion of Perceptics' contract, and, in the event that an offeror
other than Perceptics becomes the successful offeror, terminate
Perceptics' contract. (Interior also advised that, as an alternative, it
may choose to meet its requirements through a different procurement
vehicle.) On November 5, we dismissed Sysorex's protest as academic
(B-310273).
Sysorex now requests that we recommend reimbursement of the costs of
filing and pursuing its protest.
Where a procuring agency takes corrective action in response to a protest,
our Office may recommend reimbursement of protest costs where, based on
the circumstances of the case, we determine that the agency unduly delayed
taking corrective action in the face of a clearly meritorious protest,
thereby causing the protester to expend unnecessary time and resources to
make further use of the protest process in order to obtain relief. Bid
Protest Regulations, 4 C.F.R. sect. 21.8(e) (2007); AAR Aircraft
Servs.--Costs, B-291670.6, May 12, 2003, 2003 CPD para. 100 at 6. A
protest is clearly meritorious where a reasonable agency inquiry into the
protest allegations would have shown facts disclosing the absence of a
defensible legal position. AVIATE L.L.C., B-275058.6, B-275058.7, Apr. 14,
1997, 97-1 CPD para. 162 at 16. With respect to the promptness of the
agency's corrective action under the circumstances, we review the record
to determine whether the agency took appropriate and timely steps to
investigate and resolve the impropriety. See Chant Eng'g Co., Inc.--Costs,
B-274871.2, Aug. 25, 1997, 97-2 CPDpara. 58 at 4; Carl Zeiss, Inc.--Costs,
B-247207.2, Oct. 23, 1992, 92-2 CPD para. 274 at 4. While we consider
corrective action to be prompt if it is taken before the due date for the
agency report responding to the protest, we generally do not consider it
to be prompt where it is taken after that date. See CDIC, Inc.--Costs,
B-277526.2, Aug. 18, 1997, 97-2 CPD para. 52 at 2.
Sysorex asserts that reimbursement of its protest costs is warranted here
because, in its view, three issues raised in its initial protest---unequal
evaluation of handheld solutions, misevaluation of cost proposals, and
misevaluation of Sysorex's proposed network monitoring capabilities---were
clearly meritorious, but the agency nevertheless failed to take corrective
action until after the protester had responded to the agency report.
Interior denies that it unduly delayed taking corrective action in the
face of clearly meritorious protest grounds. According to Interior, it
determined to take corrective action based on problems in two areas
identified by Sysorex. Specifically, Interior states that Sysorex's
assertion in its October 22 supplemental protest that Perceptics' handheld
solution did not fully comply with the solicitation requirements "caused
the agency to question both its earlier evaluation of all offerors'
handheld solutions as well as the feasibility of the performance
requirements . . . for the handheld LPRs." Interior Comments, Dec. 3,
2007, at 2. In addition, Interior states that Sysorex, in asserting in its
October 22 supplemental protest that Perceptics' commercial truck lane did
not offer the required 95 percent accuracy read rate, "has identified an
area where the agency may have improperly relaxed a solicitation
requirement." Id. at 3. Interior concludes that, since it first learned
the basis for corrective action after it filed its agency report
responsive to the initial protest submissions, and it acted promptly
thereafter to take corrective action, there is no basis for recommending
reimbursement of protest costs.
We agree with Sysorex that its initial challenge to the evaluation of
handheld solutions was clearly meritorious. The agency's evaluation of
proposals was based in significant measure upon the determination that,
while Sysorex's [REDACTED] handheld solution "was not well suited to the
environment in which CBP operates" and "compromises officer safety,"
Source Selection Decision at 8, "Perceptics proposed a true handheld
solution, consisting of [REDACTED] that accomplishes all of the functions
of Sysorex's [REDACTED] `handheld' system." Agency Report, Oct. 15, 2007,
at 8. However, the solicitation clearly and unambiguously required that
the handheld solution be based upon a handheld wireless device that is
"capable of acting as a fully functioning LPR system." SOW
sect. C.3.1.5.2. Since Perceptics' proposal described its handheld
approach as requiring that [REDACTED], Perceptics FPR at IX-2, it should
have been clear to the agency that the approach was not likely to meet the
SOW requirement that all types of LPR systems, including the handheld
system, be capable of imaging license plates on vehicles moving at speeds
up to 60 miles per hour with 95 percent accuracy.
Interior asserts that it understood that its evaluation "might have been
flawed" only when Sysorex, in its supplemental protest filed after receipt
of a copy of Perceptics' proposal in the agency report, pointed out that
Perceptics had proposed the [REDACTED], and asserted that this [REDACTED]
could not meet the requirements of the SOW without additional equipment.
Interior Comments, Dec. 3, 2007, at 2. Again, however, it was clear that a
handheld solution that [REDACTED] was not likely to meet the SOW
requirement that the handheld system, like all other LPR systems to be
furnished under the contract, be capable of imaging license plates on
vehicles moving at speeds up to 60 miles per hour with 95 percent
accuracy. In our view, a reasonable investigation of Sysorex's claim in
its initial protest filings that all offerors would be required to propose
a suite of equipment similar to Sysorex's in order to meet the SOW
requirements, should have led the agency to examine the compliance of
Perceptics' proposed handheld solution; such examination, reasonably
conducted, necessarily would have indicated the noncompliance of
Perceptics' proposed handheld solution. Accordingly, we find that Interior
unduly delayed taking corrective action in the face of Sysorex's clearly
meritorious protest, first raised in its initial protest filings prior to
the agency report, against the evaluation of proposed handheld solutions.
As for the two additional protest grounds cited in Sysorex's request for
reimbursement, neither was clearly meritorious. In its amended protest
filed after its debriefing and prior to receipt of the agency report,
Sysorex, having been advised that Perceptics' proposal received a
significant strength on account of the ability to [REDACTED], asserted
that the agency had improperly failed to credit its proposal for a similar
capability, for [REDACTED]. Sysorex Amended Protest, Sept. 17, 2007, at
25-26. Interior responded in its report that, while Perceptics' [REDACTED]
were [REDACTED], Sysorex's [REDACTED] was less desirable because it was
offered [REDACTED]. Contracting Officer's Statement at 11-12. Sysorex then
responded in its comments that the agency had failed to account for the
fact that Sysorex's proposed LPR system nevertheless included more robust
[REDACTED] than did Perceptics' LPR system. Sysorex Comments, Oct. 25,
2007, at 11-16. In our view, it was a close question that would require
further development of the record to resolve, as to whether or not in fact
there was a significant difference between the proposals with respect to
[REDACTED] such as to warrant a strength for Perceptics but not for
Sysorex in this regard. Accordingly, Sysorex's initial challenge to the
[REDACTED] evaluation was not clearly meritorious. See Alaska Structures,
Inc.--Costs, B-298575.4, Jan. 22, 2007, 2007 CPD para. 15 at 6. As for
Sysorex's initial challenge to the cost evaluation, we note that the
protester itself conceded in its amended protest filed after its
debriefing and prior to receipt of the agency report, that "it is not
clear how the government evaluated cost/price." Sysorex Amended Protest,
Sept. 17, 2007, at 14. Given the lack of clarity in the information
available prior to receipt of the agency report as to how the agency
evaluated price, we find that Sysorex's initial challenge to the price
evaluation was not clearly meritorious.
In conclusion, we recommend that Sysorex be reimbursed the reasonable
costs of filing and pursuing its protest insofar as they relate to its
challenge to the evaluation of proposed handheld solutions. Sysorex should
submit its claim for costs, detailing and certifying the time expended and
costs incurred, directly to Interior within 60 days of receipt of this
decision. 4 C.F.R. 21.8(f)(1).
The request is granted.
Gary L. Kepplinger
General Counsel