Protesting Federal Contract Awards

29 September 2009 Publication
Authors: Philip A. Nacke David T. Ralston Jr

Legal News Alert: Litigation

At midnight on September 30, 2009, the U.S. government’s fiscal year (FY) 2009 will draw to a close, and at that moment most FY 2009-appropriated funds will no longer be available for obligation by federal agencies. As a consequence, federal agencies award a blizzard of contracts every September, and many federal contracting officers will be at their desks right up until the stroke of midnight, electronically awarding contracts and obligating billions of dollars in FY 2009 funds.

The Right to Protest
While the government’s contract award process works remarkably well, considering the huge number of contract awards, it is by no means infallible. The requirements of federal procurement laws and regulations may sometimes be overlooked or papered over, and agency award decisions may suffer from inadequate evaluation of offers and lack of adequate documentation. Hence, disappointed offerors often believe that a contract has been, or is about to be, awarded improperly or illegally, or that they have been unfairly denied a contract or opportunity to compete for a contract, and seek to vindicate their position.

At one time, objections to procurement actions or decisions were non-litigable, but today a disappointed offeror’s right to pursue a “bid protest” at the federal level is firmly entrenched, which has contributed mightily to the integrity of the federal procurement process and a remarkably transparent government procurement system. In fact, a disappointed offeror has a menu of choices as to where to protest, because there are three separate fora in which federal bid protests may be brought — the particular agency conducting the challenged procurement, the Government Accountability Office (GAO), and the United States Court of Federal Claims. Moreover, depending on the circumstances, multiple protest opportunities may be available should the protester wish to pursue them.

Selecting a Forum
Consequently, selection of the appropriate protest forum is an important first step in pursuing a bid protest. Key considerations include cost, timeliness in pursuing the protest, access to confidential information submitted by offerors and source selection sensitive documentation compiled by the agency, special jurisdictional issues regarding the agency involved, receptivity of one forum versus the others to the protest ground or grounds likely to be pursued, the ability to secure a stay of contract performance during the pendency of the protest, and the ability to recover one’s costs in the event of success in the protest.

Prompt action is essential to a successful protest in order to maximize the relief available. In the case of a negotiated procurement, the process begins by asking the agency, in writing, for a debriefing within three days of notice of contract award to a competitor.

Armed with a debriefing, a potential protester can far better assess the likelihood of success on the merits, the strongest protest grounds, and the most appropriate forum. Framing the issues in an appropriate set of protest grounds and knowing the advantages and drawbacks of the respective forum are critical aspects of a bid protest.

Fast-Paced Process
Once a protest is filed, the procedure is fast-paced, requiring a keen understanding of both the formal rules and precedent. The process, at times quite complex, strongly favors the diligent. The agency’s contracting records are available to protester counsel under protective order, and frequently additional protest grounds are developed after the contract record is produced, but only if the protester acts quite promptly.

Successful offerors can intervene in a bid protest to argue, along with the agency, why a contract award should not be challenged. Intervention can often affect the outcome, as agency counsel, frequently stretched to the limit in defending protests, welcome the support provided by intervenor counsel. Indeed, in cases where contract award decisions were close calls, the intervenor may have a stronger interest in defending the award than does the agency.

Pursuing the Process Rewarded
The federal bid protest process is at times complex, necessitating reliance on experienced practitioners. Yet investment in a protest is often rewarded, as available statistics on the protests success rate at the GAO indicate that, over a multi-year period, protesters have obtained some form of relief in as many as one-third of the cases brought there. With those statistics in mind, and considering that the outcome can be a second opportunity to compete for a major government contract, careful exploration of a bid protest will be warranted in most federal procurements.

Philip A. Nacke and David T. Ralston, Jr., Foley Government Contracts Litigation Partners in the Washington, D.C. office, have prepared the Foley Guide to Federal Bid Protests. The guide provides an in-depth review of the federal bid protest process, the available fora, and possible relief that can be obtained.  

Legal News Alert is part of our ongoing commitment to providing up-to-the-minute information about pressing concerns or industry issues affecting our clients and our colleagues. If you have any questions about this alert or would like to discuss these topics further, please contact your Foley attorney or the following:


David T. Ralston, Jr.
Washington, D.C.

Philip A. Nacke
Washington, D.C.