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Are Schedule Orders "Protest-Proof?"


In other words, task/delivery orders and BPAs, CAN be protested IAW FAR Part 33.1 procedures per FAR Part 8.404(e).

There is nothing in the FAR or in any of the Schedule contracts that provides a blanket prohibition (or even a broad general limitation) on protests against Schedule orders.  In this regard, all GSA Schedules are the same.  However, the answer is different when it comes to GSA GWACs (among other MAC and task & delivery order contracts) where FAR 16.505(a)(9) there narrows the permissible grounds for order protests to only those alleging an increase in scope, period, or maximum value. But (like the rest of FAR 16.505 incidentally), that Federal Acquisition Streamlining Act (FASA) "protest Teflon" in FAR 16.505(a)(9) does NOT apply to orders against GSA Multiple Award Schedules. Idea International v. U.S., 74 Fed. Cl 129 (2006).  In Idea International, the Court adopted the long-held GAO position that the FASA limitation on protest grounds does not apply to Schedule orders. (Here is a good summary of the Idea International case from the Coalition for Government Procurement. Here is a case discussion webinar from the McKenna Long law firm** and here is an article on on that same case from the Ackerman Senterfitt firm.  Schedule contracts behave like IDIQs in many respects.  But that doesn't mean they are true IDIQs or “task or delivery order contracts” or “multiple award contracts” in the FASA or FAR 16.505 sense of those terms.  And even where the issue of the protestability of Schedule orders had been in doubt before Idea International, FAR 16.505(a)(9) has never really helped ordering agencies when it came to Schedule BPA awards.  That's because BPAs are not "orders" themselves and agencies have more discretion in award of BPAs. Labatt-Anderson Inc., B-287081, Apr. 16, 2001; Labatt-Anderson Inc. v. U.S., 50 Fed. Cl. 99 (2001); Systems Plus, Inc., B-297215 et al., Dec. 16, 2005. (See also the separate blogsite discussion today on why Schedule BPAs are not [unlike the BPA orders] contract actions for most FAR purposes.)

 Can a disappointed contractor file a protest? Of course.  Will the protest be sustained?  That depends on the facts and whether the company has standing as an “interested party” to protest award of that Schedule order.  Generally, an agency's decision to use a Schedule acquisition strategy as opposed to an open-market (non-Schedule) strategy is not grounds for a protest and a protesting firm must hold a GSA Schedule.  A company without a GSA Schedule contract typically has no standing as an interested party to protest award of a Schedule order.  CHE Consulting, Inc. v. U.S., 47 Fed. Cl. 331 (2000); Advanced Business Systems, B-237728, Mar. 16, 1990; Sales Resources Consultants Inc., B-284943, B-284943.2, June 9, 2000; FitNet Purchasing Alliance, B-309911, Nov. 2, 2007.  Even a Schedule contractor that doesn’t have an item meeting an agency’s need has been held to not be an “interested party” in a protest.  Draeger Safety, Inc., B-285366 et al., Aug. 23, 2000.  However, there are some exceptions to the general rule if the protester claims the Schedule order doesn’t meet the ordering agency’s actual requirements or alleges that the items ordered are outside the scope of particular MAS contract.  Intelligent Decisions, Inc., B-274626, B-274626.3, Dec. 23, 1996, May 15, 1997; Marvin J. Perry & Associates, B-277684, Nov. 4, 1997. Of course, if you include open-market incidental (non-Schedule) items on your orders under FAR 8.502(f), you may have just expanded the order’s protestability to include non-Schedule contractors.  But, overall, most Schedule orders are somewhat less susceptible to a sustained protest because the universe of potential protesters is typically smaller.

 Because of the foregoing, particularly due to the typical narrowing of standing to only those with Schedule contracts, and due to the simplification of the Schedules ordering process (less to go wrong in the first place), there appears to be a general tendency for Schedule orders to have fewer sustained protests than open-market (non-Schedule) contracts/orders.  

 Of course, all this assumes the ordering agency is not making their Schedule order procurement look like a FAR Part 15 procurement but is instead taking full advantage of the streamlining offered by FAR SubPart 8.4.  An ordering activity using the Schedules is doubly hurting itself by not keeping it simple: (1) they unnecessarily increase procurement lead-lead time and order complexity and, (2) they also make themselves more vulnerable to protests.  Recall that FAR 8.404(a) says that nothing in FAR Part 15 applies to Schedule orders.  Ellsworth Associates, Inc. v U.S., 45 Fed. Cl. 388 (1999); KPMG Consulting, B-290716, Sept. 23, 2002; OSI Collection Services, B-286597.3 et al., June 12, 2001.  However, courts and boards have consistently held that where agencies inappropriately make their Schedule order procedures look like Part 15 procurements (thereby disregarding the simplified FAR 8.4 procedures), they will be held on protest to those more rigorous FAR Part 15 standards.  Computer Products, Inc., B-284702, May 24, 2000; Digital Systems Group, Inc., B-286931 et al., Mar. 7, 2001; Uniband Inc., B-289305, Feb. 8, 2002.

 For example, an ordering activity would not want to call any "brief explanation for the basis for the award decision" (FAR 8.405-2(d)) a "debriefing" (which is a FAR SubPart 15.5 term and not a Schedule order term).  Because Schedule order unsuccessful quoters are not entitled to a "debriefing", they have one less available way in which to stay performance by the new awardee, since Part 15’s "within five days of a debriefing" avenue doesn't apply to Schedules orders.  That means that if Schedule order protesters want to stay order performance, they have to protest within ten days of award of the order (which is strictly construed - - and not within ten days of when they learned of the order award.)

 A GSA Schedule contractor certainly can protest award of a Schedule order placed against that Schedule to the agency issuing that order, to GAO, or to the Court of Federal Claims.  Note here that the GSA Schedule contract PCO has nothing to do with Schedule order protests or other disputes not relating to the Schedule contract terms and conditions (FAR 8.406-6(b)) - - issues rarely relevant to something the Ordering Officer has done or failed to do.  Whether the protestor is likely to prevail on the merits of the protest is another matter and will turn on the facts, the issues (including standing to protest), the protest forum, and the applicable case law.

Managing Schedule Order Protest Risk: On What Grounds Are Protests Typically Filed Against Schedule Orders?
(For a complete discussion, see Chapter 10 in GSA Schedule Handbook (2008-2009 Ed.) by John W. Chierichella & Jonathan S. Aronie, Thomson-West, 2008, 503 pp.

1. Schedule contractor with the “right” Schedule protests order to a Schedule contractor on the “wrong” Schedule.
A sustained “wrong Schedule” protest like REEP, Inc., (B-290665, Sept. 17, 2002) demonstrates why Schedule scope determination is so important.  If you aren’t sure about which Schedule to use, ask a GSA Contracting Officer for assistance.  There are plenty of cases where requesting scope determination assistance from a GSA CO was noted with approval in support of an ordering activity’s position. See also DSD Laboratories, Inc. v. U.S., 46 Fed. Cl. 467 (2000); Lockmasters Security Institute, Inc., B-299456, May 21, 2007; Computer Universal Inc., B-291890, April 8, 2003.

2. Ordering activities who say they will evaluate quotes one way and then disregard what their RFQ says about evaluation.  
Just as in non-Schedule procurements, failure to adhere to stated evaluation criteria is a productive area for sustained protests.  For example, describing a best value evaluation in the RFQ and then awarding the order to the low-cost, technically-acceptable quoting contractor resulting in a sustained Schedule order protest in Computer Products, Inc., B-284702, May 24, 2000.

3. Failure to follow Part 15 procedures completely when an ordering agency picked some Part 15 procedures (none of which don’t apply to Schedule procurements)
As shown in the cases cited above, when agencies do things like conducting Part 15-style “debriefings” and “discussions,” GAO and the Courts review the agency actions against the standards applicable to Part 15 procurements. Labat-Anderson Inc., B-287081 et al., Apr 16, 2000; OSI Collection Services, Inc., B-286597.3, June 12, 2001; KPMG Consulting, B-290716, Sept. 23, 2002.

4. Failing to solicit a particular Schedule contractor.
In general, this is not an area where sustained protests are likely.  When an agency solicits quotes from at least three contractors, it is not required to solicit a quote from the incumbent FSS contractor.  Allmond & Co., B-298946, Jan. 9, 2007.  In addition, if the ordering officer determines that only one Schedule contractor can meet its requirements (see FAR 8.405-6), then the agency is not required to solicit quotes from other Schedule contractors.  Card Tech. Corp., B-275385 et al., Feb. 18, 1997; Delta Int’l, Inc., B-284364.2, May 11, 2000; Computer Universal, Inc., B-291890 et al., April 8, 2003.

5. Using Schedule orders to procure open market incidental items not on a Schedule contract without following all procurement regulations applicable to the open market items.
Agency ordering officers make their Schedule orders vulnerable to sustained protest when non-Schedule items totaling over the micropurchase threshold are procured as if Schedule procurements but without following FAR 8.402(f) procedures.  Agencies that use the Schedules to procure non-Schedule items without adhering to the competition requirements of CICA are risking a sustained protest. T-L-C Systems, B-285687.2, Sept. 29, 2000; American Systems Consulting, Inc., B-294644, Dec. 13, 2004.

6. Order evaluation irregularities, especially past performance.
Just as in non-Schedule procurements, protests can be sustained when ordering agencies unreasonably evaluate attributes like past performance.  For example, the mechanical evaluation of past performance scores that is unfair to non-incumbents over incumbents (or vice versa) or any to one contractor can certainly increase the risk of a sustained protest.  See OSI Collection Services, Inc., B-286597.3 et al., June 12, 2001.


**Minor observation on the McKenna Long slides:  I don’t think there is a case law consensus on the issue regarding the second bullet on Page 20 of the McKenna Long webinar, regarding one particular judge's discomfort with a Schedule order subcontractor who was not itself a Schedule holder.  While subcontracting (as opposed to Schedule Teaming) cannot be used by a Schedule contractor to expand the scope of what that contractor was awarded by GSA, there is no law, regulation, or contract language requiring subcontractors to also hold GSA Schedule contracts.  The GSA websites do a good job on the issue of distinguishing between Schedule Contractor Teaming Arrangements (where all team members must hold a Schedule) and subcontracting (where the sub need not have a Schedule contract, but any sub’s labor categories must either be matched to the prime’s labor categories or treated as open market labor under FAR 8.402(f).)  I think everything else in the McKenna Long webinar presentation is pretty noncontroversial. DC

[NOTE:  Original content created by Dave Clemens.  Edited by Dan Briest on 9/1/11.] 


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