Government Contracts Monitor

Sole Source Award: Not So Fast

August 16, 2011

By: Lindsay Simmons

On July 13, 2011, the Court of Federal Claims (CFC) granted a protester’s request and held that the method used by the Army to make a sole-source award for base shelter systems was illegal, despite the fact that the sole-source contract had been fully performed. Cal. Indus. Facilities Res. v. United States, No. 11-299C (Fed. Cl. Jul. 13, 2011) (full text available here).

The Army argued the case was moot because the contract had been fully performed, but the protestor pressed for a declaratory judgment to prevent the Government from repeating the offensive conduct in future procurements.

The court held that the matter was not moot. According to the court, the Army’s violation of competition requirements was capable of repetition (indeed the protestor was likely to be subject to the same actions in the future), but evading review (since the challenged actions were too short in duration to be fully litigated prior to contract completion).

The court did not question the Army’s urgent and compelling need for shelter systems for the war effort in Afghanistan. The Army, in fact, solicited a price quotation from the eventual awardee the day after first becoming aware of the shelter system requirement.  At the same time, however, the court noted that the contracting officials were aware of several other sources that could provide base shelter systems. Indeed, if given an opportunity, the protestor would have submitted a price quote. The court found it inexplicable under these circumstances that the Army did not contact any other shelter system manufacturer. 

Thus, the court held that the Army’s award of a sole source contract violated the competition requirements in 10 U.S.C. § 2304(e) (2006) and Federal Acquisition Regulation (FAR) 6.302-2(c)(2).  According to the court, “[e]ven when confronted with unusual and compelling urgency, the Government still must request offers from as many potential sources as is practicable.”

The court further held that the Army’s delay in publicly posting the Justification and Approval (J&A) of the sole source award until after performance was completed was “arbitrary and capricious” as it was intended to avoid a bid protest and was “calculated to obstruct the interests of those who might object to the sole source award.”

Lindsay Simmons is responsible for the content of this article.