Lockheed Martin Simulation, Training & Support, B-292836.8; B-292836.9; B-292836.10, November 24, 2004

Lockheed Martin Simulation, Training & Support, B-292836.8; B-292836.9; B-292836.10, November 24, 2004 TITLE: Lockheed Martin Simulation, Training & Support, B-292836.8; B-292836.9; B-292836.10, November 24, 2004 BNUMBER: B-292836.8; B-292836.9; B-292836.10 DATE: November 24, 2004 ********************************************************************** Decision Matter of: Lockheed Martin Simulation, Training & Support File: B-292836.8; B-292836.9; B-292836.10 Date: November 24, 2004 Thomas C. Papson, Esq., Richard B. Oliver, Esq., Alison L. Doyle, Esq., Jason N. Workmaster, Esq., Stephen M. Lastelic, Esq., Kevin J. Slattum, Esq., and Joseph S. Beemsterboer, Esq., McKenna Long & Aldridge LLP, for the protester. Rand L. Allen, Esq., Philip J. Davis, Esq., Paul F. Khoury, Esq., Michael S. Caldwell, Esq., William J. Grimaldi, Esq., Adam J. Rogers, Esq., and Steven N. Tomanelli, Esq., Wiley Rein & Fielding LLP, for Electronic Data Systems Information Services, LLC, an intervenor. Peter F. Pontzer, Esq., Kenneth M. Hyde, Esq., Kimberly Y. Nash, Esq., and Angela T. Puri, Esq., Department of Housing and Urban Development, for the agency. Scott H. Riback, Esq., and John M. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST 1. Protest that agency improperly engaged in post-final proposal revision (post-FPR) discussions only with awardee is sustained where record shows that post-FPR exchange resulted in material changes to awardee's proposal. 2. Protest that agency failed to engage in meaningful discussions with protester is sustained where record shows that agency failed to discuss weaknesses first identified in a reevaluation of proposals that were based on earlier proposal language, and also was unreasonably vague in areas where agency did conduct discussions. DECISION Lockheed Martin Simulation, Training & Support, a business unit of Lockheed Martin Corporation (LMC), protests the award of a contract to Electronic Data Systems Information Services, LLC (EDS) under request for proposals (RFP) No. R-OPC-21970, issued by the Department of Housing and Urban Development (HUD) to acquire information technology (IT) services. LMC asserts that the agency committed various errors in conducting discussions, misevaluated proposals, and made an unreasonable source selection decision. We sustain the protest. BACKGROUND This is the third occasion where we have been called upon to review HUD's actions in connection with this acquisition. In August 2003, HUD awarded a contract to EDS under the subject RFP and LMC filed a protest relating to that award. We sustained the protest, finding that the agency misevaluated the proposals in numerous respects and appeared to have applied a double standard in its evaluation; as a consequence, the agency's source selection decision was not reasonable. We recommended that the agency reopen the acquisition, engage in discussions with the offerors, obtain and evaluate revised proposals (being sure to apply a consistent standard in its evaluation) and make a new source selection decision. Lockheed Martin Info. Sys., B-292836 et al., Dec. 18, 2003, 2003 CPD P 230. During the pendency of the initial protest, the agency determined that proceeding with performance of the EDS contract in the face of the protest was in the government's best interest. The agency therefore began transitioning its IT requirements from LMC, which had been the incumbent, to EDS. At the time of the agency's original decision to proceed with performance, LMC did not challenge the agency's actions. Subsequently, and at approximately the same time that the agency initiated its corrective action, LMC pursued injunctive relief at the United States Court of Federal Claims, seeking to prevent the further transition of IT activities from LMC to EDS. The Court did not rule on that dispute because the parties arrived at a negotiated settlement that suspended further transition activities until a new award decision could be made. Thus, following these actions, EDS was performing a portion of HUD's IT requirements, and LMC the remainder. In response to our earlier decision, the agency amended the RFP in numerous significant respects and afforded the offerors an opportunity to submit revised proposals. Thereafter, both LMC and EDS filed pre-closing protests, each maintaining that the terms of the reopened competition provided the other offeror an unfair competitive advantage. Our Office conducted an alternative dispute resolution (ADR) session in an effort to settle the protests and allow the agency to proceed with its acquisition.