Intellectual Properties, Inc., B-280803, November 19, 1998

B-280803 Nov 19, 1998 Jump To VIEW DECISION RELATED PAGES GAO CONTACTS Highlights Agency's determination not to award the protester phase II funding for a project the protester proposed under the Department of Defense Small Business Innovation Research program is sustained where the agency's determination was primarily based upon the protester's lack of private sector funding for its phase II proposal. Which was inconsistent with the evaluation criteria set forth in the solicitation. 2. Agency's post-award reevaluation of the protester's proposal and determination that the proposal could have been rejected for a completely different reason than originally asserted by the agency does not establish that the protester was not prejudiced by the agency's initial evaluation. View Decision Matter of: Intellectual Properties, Inc. File: B-280803 Date: November 19, 1998 DIGEST Attorneys DECISION Intellectual Properties, Inc. (IPI) protests the Ballistic Missile Defense Organization's (BMDO) determination not to award it phase II funding for a project IPI proposed under the Department of Defense (DOD) Small Business Innovation Research (SBIR) program. IPI contends that its proposal to perform research on "Passive Multistatic Hitchhiking Array for Search and Track" would have been funded if BMDO had evaluated IPI's proposal in a reasonable manner consistent with the evaluation criteria set forth in the solicitation. We sustain the protest. The SBIR program is conducted pursuant to the Small Business Innovation Development Act, 15 U.S.C. Sec. 638 (1994 & Supp. II 1996), which requires certain federal agencies to reserve a portion of their research and development funds for awards to small businesses. The program is made up of three phases. The program description set forth in the solicitation provided that "[p]hase I is to determine, insofar as possible, the scientific, technical, and commercial merit and feasibility of ideas submitted under the SBIR program." DOD Fiscal Year 1997 SBIR Program Solicitation 97.1 at 1. The solicitation added with regard to phase I that "[p]roposals should concentrate on that research or research and development which will significantly contribute to proving the scientific, technical, and commercial feasibility of the proposed effort, the successful completion of which is a prerequisite for further DoD support in Phase II." Id. Firms that receive phase I awards may submit proposals for further development work under phase II of the SBIR program. The solicitation's program description provided that "[s]ubsequent Phase II awards will be made to firms on the basis of results of their Phase I effort and the scientific, technical, and commercial merit of the Phase II proposal." Id. Phase III contemplates, unlike phases I and II, that non-SBIR funds will be used to pursue commercial applications of research and development. Microexpert Sys., Inc., B-233892, Apr. 13, 1989, 89-1 CPD Para. 378 at 1. Specifically, the program description on page 1 of the solicitation stated with regard to phase III that "[u]nder Phase III, the small business is expected to use non-federal capital to pursue private sector applications of the research or development." /1/ Section 4.3 of the solicitation set forth the following evaluation criteria for phase II proposals: a. The soundness and technical merit of the proposed approach and its incremental progress toward topic or subtopic solution. b. The potential for commercial (government or private sector) application and the benefits expected to accrue from this commercialization. c. The adequacy of the proposed effort for the fulfillment of requirements of the research topic. d. The qualifications of the proposed principal/key investigators supporting staff and consultants.