The cost of protests: Legal fees

The cost of protests: Legal fees

Two decisions handed down this week by the Government Accountability Office demonstrate that victory in a protest – whether it leads to a contract award or not — doesn’t always bring reimbursement of legal expenses. You could still wind up at a financial loss.

Protesting contractors: InfraMap Corp., Glen Allen, Va.; ARINC Engineering Services LLC, Annapolis, Md.

Contracting agency: Department of the Army

Protest issue: Whether the company should be reimbursed for protest costs

GAO Decisions, March 26 and March 28, 2012: InfraMap Denied; ARINC Denied.

Post-mortem: Both InfraMap and ARINC requested that the GAO recommend reimbursement of the costs of filing and pursuing their protests, both of which led to corrective actions by the agencies before any decision was handed down by GAO.

It would appear that these protestors had valid grounds for their protests, at least in part, given that both agencies took corrective action. But in both cases the GAO found that the agencies did not unduly delay taking corrective action, nor was either case “clearly meritorious.” That leaves these protestors responsible for what are likely very high attorney fees and costs.

If that were not enough, the corrective action taken by the government in both cases ensured that the award decision would remain unchanged. In InfraMark’s case, the Army “removed the requirement of a price realism analysis,” which was at the heart of the protest, and in the case of ARINC, the GSA agreed to “amend the RFQ to more accurately reflect its needs.” In other words, it adjusted the solicitation to better support its decision.

The lesson is clear: A contractor that files a protest must accept that – regardless of how right you may be – legal costs and fees may be lost and corrective action taken in response to your protest may put you no closer to a contract win.