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GAO Annual Report On Bid Protests: 2018 Yields More Protests, More Merit Decisions, But Fewer Sustains and Fewer Hearings

On November 27, 2018, the U.S. Government Accountability Office (“GAO”) released its Bid Protest Annual Report to Congress for Fiscal Year 2018.

Under the Competition in Contracting Act of 1984 (“CICA”), GAO is required to report annually to Congress on each instance in which (1) a federal agency did not fully implement a recommendation made by GAO in connection with a bid protest decision, or (2) a final decision in a protest was not rendered within 100 days after the date the protest was submitted to the Comptroller General, during the prior fiscal year. GAO reported no such instances for Fiscal Year 2018.

CICA also requires the Annual Report to include “a summary of the most prevalent grounds for sustaining protests” during the preceding fiscal year. For 2018, GAO reported the most prevalent reasons for sustaining protests were: (1) an unreasonable technical evaluation, (2) an unreasonable cost or price evaluation; and (3) a flawed selection decision.

Finally, the Annual Report includes statistical data for GAO filings during FY2018, as well as a comparison to such filings from FY2014 to FY2017. Highlights include:

  • 2,607 cases were filed with GAO during FY2018, which represents a slight increase (less than 1%) from FY2017. Of these, 2,474 were bid protests (up from 2,433 in FY2017), with the balance being cost claims or requests for reconsideration.

  • 622 cases resulted in a decision on the merits. This is up from 581 (a 7% increase) in FY2017.

  • Of the protests resolved on the merits during FY2018, only 15% were sustained. This is down from 17% in FY2017 and 23% in FY2016.

  • There was a significant reduction in the number of evidentiary hearings. Only 5 cases went to hearing, representing 0.51% of the cases closed during the fiscal year. The prior four years had seen 17 (FY2017), 27 (FY2016), 31 (FY2015) and 42 (FY2014) hearings conducted. These represented, respectively, 1.70%, 2.51%, 3.10% and 4.70% of the cases closed in those years

  • The FY2018 effectiveness rate of protests, which is based on a protester obtaining some form of relief from the agency, either as a result of voluntary agency corrective action or GAO sustaining a protest, was 44%. This is a decrease of 3% from FY2017.

As the foregoing statistical data demonstrate, pursuing a successful protest at GAO continues to be the exception, not the rule, with the vast majority of protests proceeding to a final decision resulting in a denial or dismissal. But even when voluntary agency corrective action is considered (i.e., where the protestor gets some sort of remedial relief, but GAO does not rule on the ultimate merits of the protest), less than half of all protests result in any kind of relief. In many cases where corrective action ensues, whether voluntarily or a result of a GAO decision, that corrective action generally gives the successful protester only a “second bite” at the proverbial “apple,” usually in the form of a re-evaluation or a reopening of the competition. In other words, “winning a protest” is not the same as “winning a contract.”

Accordingly, contractors considering filing a protest should work closely with their counsel to evaluate the merits of their case and the probability of success before filing, and to ensure that if they file, their strongest protest grounds are presented clearly and convincingly before GAO.

Copyright © 2018, Sheppard Mullin Richter & Hampton LLP.

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About this Author

John W. Chierichella, Sheppard Mullin Law Firm, International Trade Attorney
Partner

John Chierichella is a partner in the Government Contracts and Regulated Industries Practice Group in the firm's Washington, D.C. office.

Areas of Practice

Mr. Chierichella has a broad range of experience in government contract matters, including bid protests, claims and appeals, cost and CAS issues, teaming disputes, GSA's Multiple Award Schedule (MAS) Program, compliance reviews and internal investigations, and qui tam and other False Claims Act litigation.

202-218-6878
Adam A. Bartolanzo, Sheppard Mullins, government contracts litigation, FAR Counsil

Adam A. Bartolanzo is an attorney in the Government Contracts, Investigations & International Trade Practice Group in the firm’s Washington, D.C. office.

Mr. Bartolanzo’s practice focuses on government contracts litigation and counseling. His experience includes advising clients on small business set asides, assisting contract termination appeals, performing transactional due diligence specific to government contractors’ needs, and assessing client compliance with the FAR and other regulations.  He has represented both plaintiffs and defendants in commercial litigation before United States District Courts and state courts, and has experience in governmental investigations.

202-747-2643