Potential Bid Protest Dangers: When the Agency Produces Documents Early

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To paraphrase Virgil, beware of agency counsel bearing gifts.  Under the U.S. Government Accountability Office’s (GAO) bid protest rules, an agency is required to produce a report within 30 days of a protest that includes a copy of all relevant documents.  However, there is nothing preventing an agency from producing some or all of these documents even sooner.  And, in recent cases, we have seen agency counsel increasingly doing so.

While the agency almost never explains why it is producing these documents early, its reasons are invariably not innocuous.  Sometimes, an agency will produce such documents early as a precursor to a motion to dismiss.  Other times, an agency will produce such documents early in an effort to resolve document request objections early.

Even more often, the early production of such documents serves as a means to force the protester to file additional protest grounds sooner.  Under the GAO’s rules, a protest basis must be raised within 10 days of when the protester knew or should have known its basis to protest.  When an agency produces documents early (but not its legal memorandum replying to the protest), it effectively starts this clock early: forcing the protester to analyze these documents to see if the agency made additional evaluation errors beyond those discussed in the initial protest.  The protester then has 10 days to draft supplemental protest grounds – essentially a new protest – before it even has the benefit of knowing what the agency’s legal position is regarding the original protest.

The relatively easy step of producing documents early can produce a number of benefits for the agency. First, if the protester doesn’t file a supplemental protest, it effectively prevents it from doing so at a later point.  The agency can then use anything in the evaluation documents that are “unchallenged” against the protester – for instance if these unchallenged evaluation conclusions can be used to support an argument that the protester is not an interested party to file a protest because it was not next in line for award.

Even if the protester does file a supplemental protest, this benefits the Agency counsel for several reasons. First, the agency has forced additional costs, i.e., the costs of filing a separate supplemental protest, on the protester at little to no cost to the agency.  These costs could mean that a protester has less money and time to spend on filing comments responding to the agency’s legal memorandum on the original protest grounds.

Second, and perhaps more significantly, the agency gets the benefit of seeing the protester’s entire hand, both its initial and supplemental protest arguments, before it has to show its cards.  This burdens the protester, who has to file its supplemental protest in the dark, without the benefit of knowing what strategy the agency is going to take in response to its protest.  And it benefits the agency, which can then decide whether to go forward fighting the protest or whether to take corrective action.  If the agency counsel decides to then take corrective action, the ultimate benefit kicks in: it does not have to pay the protester’s protest costs because, under the GAO’s rules, the agency has taken corrective action “promptly” despite its having forced the protester to incur the additional costs associated with filing a supplemental protest.

In sum, there are a number of reasons why an agency might produce documents early.  When the agency does do so, protesters should proceed carefully and with an awareness of the strategic implications and dangers involved.

To paraphrase Virgil, beware of agency counsel bearing gifts.  Under the U.S. Government Accountability Office’s (GAO) bid protest rules, an agency is required to produce a report within 30 days of a protest that includes a copy of all relevant documents.  However, there is nothing preventing an agency from producing some or all of these documents even sooner.  And, in recent cases, we have seen agency counsel increasingly doing so.

While the agency almost never explains why it is producing these documents early, its reasons are invariably not innocuous.  Sometimes, an agency will produce such documents early as a precursor to a motion to dismiss.  Other times, an agency will produce such documents early in an effort to resolve document request objections early.

Even more often, the early production of such documents serves as a means to force the protester to file additional protest grounds sooner.  Under the GAO’s rules, a protest basis must be raised within 10 days of when the protester knew or should have known its basis to protest.  When an agency produces documents early (but not its legal memorandum replying to the protest), it effectively starts this clock early: forcing the protester to analyze these documents to see if the agency made additional evaluation errors beyond those discussed in the initial protest.  The protester then has 10 days to draft supplemental protest grounds – essentially a new protest – before it even has the benefit of knowing what the agency’s legal position is regarding the original protest.

The relatively easy step of producing documents early can produce a number of benefits for the agency.  First, if the protester doesn’t file a supplemental protest, it effectively prevents it from doing so at a later point.  The agency can then use anything in the evaluation documents that are “unchallenged” against the protester – for instance if these unchallenged evaluation conclusions can be used to support an argument that the protester is not an interested party to file a protest because it was not next in line for award.

Even if the protester does file a supplemental protest, this benefits the Agency counsel for several reasons.  First, the agency has forced additional costs, i.e., the costs of filing a separate supplemental protest, on the protester at little to no cost to the agency.  These costs could mean that a protester has less money and time to spend on filing comments responding to the agency’s legal memorandum on the original protest grounds.

Second, and perhaps more significantly, the agency gets the benefit of seeing the protester’s entire hand, both its initial and supplemental protest arguments, before it has to show its cards.  This burdens the protester, who has to file its supplemental protest in the dark, without the benefit of knowing what strategy the agency is going to take in response to its protest.  And it benefits the agency, which can then decide whether to go forward fighting the protest or whether to take corrective action.  If the agency counsel decides to then take corrective action, the ultimate benefit kicks in: it does not have to pay the protester’s protest costs because, under the GAO’s rules, the agency has taken corrective action “promptly” despite its having forced the protester to incur the additional costs associated with filing a supplemental protest.

In sum, there are a number of reasons why an agency might produce documents early.  When the agency does do so, protesters should proceed carefully and with an awareness of the strategic implications and dangers involved.  - See more at: http://www.pilieromazza.com/blog/potential-bid-protest-dangers-when-the-agency-produces-documents-early#sthash.8v4kYzbb.dpuf

Topics:  Bid Protests, Document Productions, GAO, Public Entities

Published In: Civil Procedure Updates, Government Contracting Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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