Background
The Defense Information Systems Agency solicited proposals for a managed cloud-based browser-isolation service using Menlo Security’s proprietary technology. The solicitation called for award to the lowest-priced technically acceptable offeror. Four offerors submitted proposals, and the agency found all four technically acceptable. By Light Professional IT Services, LLC submitted the lowest final evaluated price, $344,654,988.32, and received the contract.
22nd Century Networks alleged that Menlo charged By Light substantially less than it charged other offerors for required services and licenses. According to 22nd Century, because Menlo’s charges represented most of each offeror’s price, DISA effectively allowed Menlo to select the winner without safeguards ensuring fair treatment. The government and By Light moved to dismiss and, alternatively, sought judgment on the administrative record.
The Court’s Holding
The court denied the motions to dismiss. It held that 22nd Century had not waived its challenge under the Blue & Gold rule because the possibility that Menlo would quote different prices to different offerors was not a patent solicitation defect or ambiguity. The court also had Tucker Act jurisdiction because the protest challenged DISA’s contract award and alleged failure to ensure a fair procurement, even though Menlo’s conduct underlay the claim.
On the merits, however, the court denied 22nd Century’s motion and granted judgment on the administrative record to the government and By Light. The record did not show that DISA knew Menlo had charged offerors different prices. DISA evaluated every proposal under the same stated factors, was not required to conduct a price-realism analysis, and rationally selected By Light as the lowest-priced technically acceptable offeror. The solicitation also did not require Menlo to quote identical prices. The court separately denied supplementation because the proposed declarations and exhibits were not before the agency and were unnecessary for effective judicial review.
Key Takeaways
- A post-award challenge is not waived under Blue & Gold unless the alleged solicitation defect or ambiguity was patent before proposals were due.
- An agency does not act arbitrarily merely because a required commercial supplier gives competing offerors different prices, where the agency lacked knowledge of the disparity and the solicitation imposed no equal-pricing requirement.
- Extra-record evidence may supplement a bid-protest record only when its omission would prevent effective judicial review.
Why It Matters
The decision distinguishes an offeror’s dissatisfaction with a supplier’s commercial pricing from an agency procurement error. In an LPTA competition, courts will generally uphold an award when the agency follows the announced evaluation method and the record does not establish that it knew of, caused, or was required to investigate the alleged supplier disparity.
The opinion also underscores that procurement design and procurement legality are not identical: the court observed that best practices may differ from what the law requires, but it would not impose an unstated equal-pricing or price-realism obligation on DISA.