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Why Should You Intervene in a Bid Protest?

Monday, September 15, 2003

Your company was delighted to receive the award of a government contract, only to have the euphoria cut short when you receive a notice that another offeror has filed a bid protest. What should you do? Frequently, the awardee relies on the agency to fight the protest. However, we believe this is a mistake and advocate that the awardee exercise its right to intervene in, and actively participate in, the bid protest. Intervention is permitted at both at the U.S. Court of Federal Claims (the COFC) and at the U.S. General Accounting Office (GAO), the two non-agency bid protest forums.1

The Intervention Process

The COFC procedures in protest cases are set forth at Appendix C of the Rules of the United States Court of Federal Claims (RCFC). Part II of Appendix C, Requirement for Pre-Filing Notification, requires the plaintiff's counsel, prior to filing a protest, to provide "at least 24-hours advance notice of filing" to various parties, including the "apparently successful bidder/offeror (in cases where there has been an award and the plaintiff has received notice of the identity of the awardee)." RCFC Appendix C, II(d). This notifies the potential intervenor of the protest, giving them time to prepare to file a request for intervention upon the filing of the protest. While the COFC's rule does not require pre-filing notice to interested parties who are not the "apparently successful bidder/offeror" (and therefore about whom the protester may have no knowledge), such parties must be identified at the initial status conference as required under Appendix C, IV(a).

If the protest was filed at the GAO, a potential intervenor should receive notice of the filing of a bid protest from the contracting agency. GAO's bid protest regulations at 4 CFR § 21.3(a) note that

GAO shall notify the contracting agency by telephone within 1 day after the filing of a protest, and, unless the protest is dismissed under this part, shall promptly send a written confirmation to the contracting agency and an acknowledgment to the protester. The contracting agency shall immediately give notice of the protest to the contractor if award has been made or, if no award has been made, to all bidders or offerors who appear to have a substantial prospect of receiving an award. …

GAO defines an intervenor as

an awardee if the award has been made or, if no award has been made, all bidders or offerors who appear to have a substantial prospect of receiving an award if the protest is denied.

4 CFR § 21.0(b). Since the agency can easily identify potential interested parties, all interested parties receive notice of the protest when it is commenced at GAO.

The next step is to file a request to intervene. At the COFC, the intervenor should file a Motion to Intervene under RCFC 24, explaining why it should be permitted to intervene, and providing a proposed order. Obviously, all parties must be served with the motion under RCFC 5. We usually contact the protester and other parties in advance, so that we can include in our motion that those parties have received the motion and have no objection to it. This expedites our admission and participation in the case.

If we receive notice of the intent to file a bid protest at the COFC, we usually ask the protester's counsel what time the protest will be filed - especially if the protest includes a request for injunctive relief. In this way, we ensure that we are at the COFC when the protest is filed, which enables us to file our Motion to Intervene immediately after the filing of the protest. Thereafter, the case is assigned to the judge, and if the judge wishes to speak with the parties at that time, we can be present at that proceeding.

At the GAO, intervening is easier. The prospective intervenor need only send a letter to GAO, the agency, the protester, and any other participants demonstrating why it is an interested party and asking that it be permitted to intervene. We usually attempt to intervene on the same day the protest is filed, or as soon thereafter as possible. Once again, we attempt to contact the agency, protester, and other parties so that we can inform GAO in our request to intervene that those parties have no objection to our request.

If the request for intervention at either the COFC or the GAO is granted, the intervenor can participate fully in the bid protest. The one caveat is that if a Protective Order is issued by either the COFC (see RCFC Appendix C, part VI) or the GAO (see 4 CFR § 21.4), evaluation data, including proprietary business information, will not be released to individuals involved in decision-making for a company, as knowledge of such information would give the company an unfair advantage in the marketplace. Since it is, at best, difficult for company officials, including in-house counsel (unless counsel can show that he/she is not involved in the competitive decision-making process) to gain admission to material under protective order, more often than not, outside counsel must represent the company's interests in the bid protest.

Why Intervene in a Bid Protest?

Simply put - the agency's interests may not be the same as your company's interests. While many times the government will want to stand by its award, there are other times where the agency decides to end the protest by taking "corrective action" to address the protest issues, which could include potentially rescinding contract award or re-opening competition. As we have seen, however, sometimes the government's decision to take corrective action is not proper - and having intervened, we were in a better position to try and convince the agency to continue to defend the protest. If the agency ultimately decides to take corrective action, which is its right, the intervenor is well positioned to fight to preserve its contract award or, as we recently did in MCII Generator & Electric, Inc. v. United States, No. 02-85C, 2002 U.S. Claims LEXIS 172 (Mar. 18, 2002), limit the agency's corrective action (see our article on this subject, "Reopening Competition After Award Due to Procurement Error: What's an Agency to Do?").

Are there other reasons to intervene in a bid protest? For one, the agency attorney (or the Department of Justice attorney, who represents the government at the COFC), may, like many government employees, have too much work and too little time to do it, or have limited bid protest experience. This is particularly true at this time, as the government is losing many of its more senior employees as the baby-boomers retire from the workplace.

Moreover, if the protester attacks technical issues in your company's proposal, who better than you to explain the issues and deflect the protester's attack? In cases where technical issues are critical, your company's knowledge of such issues is a significant reason to intervene. A company may have expertise beyond that of agency personnel and be better able to rebut the protester's allegations concerning technical issues than the agency itself.

In addition, the government attorney may have limited access to research resources. In fact, in one protest in which we represented an intervenor, the agency attorney's office did not even have access to computer-assisted legal research such as LexisNexis™, which certainly effected the government's ability to defend the protest. Because we intervened, we were able to discuss our position, including our research, with the agency counsel. In addition, we frequently are able to provide the GAO with citations to cases that were more recent or more relevant than those which the agency, with its limited resources, could locate.

If you would like to discuss whether or not your company should intervene in a bid protest, please feel free to contact us - just please make sure to call us before or as soon as you receive notice that the protest has been filed!

ENDNOTES

1. Agency-level bid protests as discussed at FAR 33.103 do not provide a procedure for intervention, although FAR 33.103 does provide for notice to offerors where award is withheld pending agency resolution of the protest. Intervention in an agency-level protest is at the discretion of the agency, and some agencies only permit intervention in rare circumstances, if at all. In addition, the issue of how protected material must be treated is complicated by the fact that often agency-level protests are pursued by companies without using outside counsel. Under such circumstances, it may be difficult or impossible to create a protective order mechanism allowing intervenors access to source selection sensitive or business proprietary materials.

Copyright © 2003 Michael A. Hordell and Laura L. Hoffman.

Written by

Michael A. Hordell
Phone: 202.220.1232
Fax: 202.220.1665
hordellm@pepperlaw.com


Laura L. Hoffman

This article is informational only, and should not be construed as legal advice or legal opinion on specific facts.


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