A New Twist On Establishing Interested Party Status At The GAO

Posted on December 9, 2011 by Sheppard Mullin
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By: Townsend Bourne

In a bid protest decision regarding the propriety of agency corrective action, GAO recently carved out a new exception to its general rule that those who do not participate in a protest that engenders corrective action are not interested parties to challenge the corrective action. In North Wind, Inc.; Earth Resources Technology, Inc., B-404880.4 et al., 2011 CPD ¶ 246 (Comp. Gen. Nov. 4, 2011), North Wind, Inc. (“North Wind”) protested NASA’s initial award of a contract to Navarro Research and Engineering, Inc. (“Navarro”) and subsequently raised additional challenges to the award in a supplemental protest that followed receipt of documents from the Agency. In response to North Wind’s supplemental protest, NASA decided to take corrective action. Earth Resources Technology, Inc. (“ERT”), another disappointed offeror in the competition, did not initially file its own protest challenging the award to Navarro.


Following reevaluation of proposals by NASA and a subsequent award again to Navarro, North Wind again protested the award decision. This time, however, ERT also filed a protest challenging the Agency’s reevaluation and decision to award the contract to Navarro. Both NASA and Navarro challenged ERT’s status as an interested party, citing the general rule that an offeror that failed to participate in the original protest is not eligible to protest corrective action taken by an agency in response to the original protest. See Formal Mgmt. Sys., B-260412, B-260412.3, 95-2 CPD ¶ 158 (Comp. Gen. Oct 4, 1995). However, GAO quickly dismissed this argument, stating that ERT’s protest was a protest of “the ultimate selection decision that resulted from the earlier corrective action” rather than a protest of the corrective action itself. This subtle distinction, held GAO, rendered ERT an interested party.

Thus, challenging an award decision following agency corrective action without taking part in the original protest is now clearly a viable option. Of course, the exception is fairly narrowly drawn and, if the challenge focuses on the scope of the corrective action versus its outcome, the non-protesting party must still forever remain silent. 
 

Authored by:

Townsend Bourne
(202) 469-4917
tbourne@sheppardmullin.com
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