In the United States Court of Federal Claims

No. 17-787C

(Filed: October 17, 2017)

(Re-filed: October 27, 2017)1

* * * * * * * * * * * * * * * * * * * * * * 

FREEALLIANCE.COM, LLC,

Plaintiff,

v.

THE UNITED STATES OF AMERICA,

Defendant.

* * * * * * * * * * * * * * * * * * * * * *

Matthew Thomas Schoonover, Lawrence, KA, for plaintiff.

Delisa Maria Sanchez, United States Department of Justice, Civil 

Division, Commercial Litigation Branch, Washington, DC, for defendant. 

OPINION

BRUGGINK, Judge.

This is a pre-award bid protest by FreeAlliance.com, LLC 

(“FreeAlliance”) of its exclusion from further consideration by the National 

Institute of Health (“NIH”) under request for proposals no. NIHJT2016015 

(“RFP”). NIH excluded plaintiff for failure to comply with the requirements 

of RFP Section L.3.1.h, specifically the requirement of a verification on 

 

1 This opinion was originally issued under seal pursuant to the protective 

order entered in this case. The parties timely offered joint proposed 

redactions. We adopt the parties’ proposed redactions because we find them 

to be appropriate. Those redactions are indicated herein with brackets.

Bid protest; claim 

for reinstatement to 

agency evaluation; 

FAR 16.301(a)(3); 

unequal treatment.
2

letterhead providing that the accounting system had been audited and 

determined adequate for determining costs applicable to this contract in 

accordance with the Federal Acquisition Regulation (“FAR”), 48 C.F.R. §

16.301–3(a)(1) (2016). 

The parties have filed cross-motions for judgment on the 

administrative record. The matter is fully briefed, and oral argument was held 

on October 10, 2017. Because the government was not arbitrary and 

capricious in its evaluation and did not treat FreeAlliance’s proposal 

unequally, we grant the government’s cross-motion for judgment on the 

administrative record and deny plaintiff’s motion.

BACKGROUND

The Office of Management and Budget has designated NIH as an 

Executive Agent for government-wide IT acquisitions, authorizing it to 

award and administer the Chief Information Officer-Solutions and Partners 

3 (“CIO-SP3”) Small Business Government-Wide Acquisition Contract 

(“GWAC”). Administrative Record (“AR”) 370. The CIO-SP3 GWAC is a 

ten-year Indefinite Delivery/Indefinite Quantity Contract providing 

Information Technology (“IT”) solutions and services. NIH issued the RFP 

on March 14, 2016 pursuant to the CIO-SP3 GWAC.

The RFP requirement at issue here is verification of an adequate 

accounting system found in RFP Section L.3.1.h. It stated that an offeror 

“must have verification . . . of an accounting system that has been audited 

and determined adequate for determining costs applicable to this contract in 

accordance with FAR 16.301-3(a)(1).”2AR 496. Verification was necessary 

because the contract could require contractors to respond to cost 

reimbursement task orders. 

 

2 FAR part 16.301-3(a)(1) provides that “[a] cost reimbursement contract 

may be used only when “[t]he factors in 16.104 have been considered . . . .” 

Those factors include the adequacy of the contractor’s accounting system to 

“ensure that the contractor’s accounting system will permit timely 

development of all necessary cost data in the form required by the proposed 

contract type . . . .” FAR 16.104(i). Additionally, FAR part 16.301-3(a)(3) 

reiterates that a cost reimbursement contract may not be used unless “[t]he 

contractor’s accounting system is adequate for determining costs applicable 

to the contract or order.”
3

NIH authorized offerors to provide verification by any one of four 

sources: (1) the Defense Contract Audit Agency (“DCAA”); (2) the Defense 

Contract Management Agency (“DCMA”); (3) any federal civilian audit 

agency; or (4) a third-party Certified Public Accounting (“CPA”) firm. In the 

event any member of a CTA relied on a third-party CPA, the verification had 

to be on the letter head of the third-party CPA and certified by a CPA. 

Finally, the verification instruction provided that the proposal must include:

[A] contact name and contact information (i.e., phone number, 

address, email address) of its representative at its cognizant 

DCAA, DCMA, federal civilian audit agency, or third-party 

accounting firm and submit, if available, a copy of the PreAward Survey of Prospective Contracting Accounting System 

(SF 1408), provisional billing rate, and/or forward pricing rate 

agreements.

AR 496.

The RFP provided that offerors were permitted to form contractor 

team arrangements (“CTA”) as defined by FAR part 9.601.3 The offeror 

forming a CTA would include with its proposal “the information required 

under subpart (1) of this section, ‘Instructions regarding FAR 9.601(1) 

CTAs,” including a “verification of an adequate accounting system.” AR 

493-96. Each member of the CTA was individually required to provide 

verification of an adequate accounting system. “Failure to do so will result 

in an unacceptable rating.” AR 496.

The RFP also stated, “The Government intends to evaluate proposals 

and award a contract without discussion with Offerors (except clarifications 

as described in FAR 15.306(a)). . . . The government reserves the right to 

conduct discussions if the Contracting Officer later determines them to be 

necessary.”4 AR 483-84. RFP Section M.1.3 reiterated, “The Government 

 

3 A CTA is “an arrangement in which (1) [t]wo or more companies form a 

partnership or joint venture to act as a potential prime contractor; or (2) [a] 

potential prime contractor agrees with one or more other companies to have 

them act as its subcontractors under a specified Government contract or 

acquisition program.” FAR 9.601.

4 The RFP defined discussions as “negotiations that occur after establishment 

of the competitive range that may, at the Contracting Officer’s discretion, 

result in the Offeror being allowed to revise its proposal.” AR 480.
4

reserves the right to award contracts without discussions.” AR 504.

Evaluation of Proposals

NIH evaluated proposals in two phases. The first phase of evaluation 

was compliance with four “Go/No-Go requirements.” AR 503. The first two 

Go/No-Go requirements are at issue in this claim: 

During Phase 1, the Government will evaluate proposals using 

the following four (4) Go/No-Go requirements: 

1) Compliant Proposal - If the proposal does not contain the 

required documents, the Government may deem the proposal 

to be “unacceptable” and ineligible for further consideration 

for award.

2) Verification of an Adequate Accounting System - The 

Government will evaluate evidence that the Offeror, and all 

CTA members (if applicable) have an adequate accounting 

system in accordance with FAR 16.301-3(a)(1), as required 

under Section L.3.1.h. If the Offeror and all CTA members (if 

applicable) fail to furnish verification of an adequate cost 

accounting system will result in an “unacceptable” rating, the 

proposal will be determined “Unacceptable” and ineligible for 

further consideration going forward. 

3) Factor 1 – Subfactor 1 – Task Area 1, IT Services for 

Biomedical Research, Health Sciences, and Healthcare . . . . 

4) Factor 2 – Subfactor 1 – Domain-Specific Capability in a 

Health-Related Mission . . . . 

AR 503.

The second phase of evaluation was assessing proposals using a best 

value methodology, including price and non-price factors. AR 506-13. Phase 

two is not at issue in this protest. 

FreeAlliance’s CTA & Proposal

FreeAlliance formed a FAR part 9.601(1) CTA with HealthTech 
5

Solutions LLC (“HealthTech”) and Nish Consulting, Inc. (“Nish”), on March 

23, 2016, which qualified FreeAlliance’s proposal for HUBZone 

consideration. FreeAlliance submitted a proposal on May 13, 2016. The 

agency received 552 proposals of which seventy were HUBZone proposals, 

such as the FreeAlliance proposal.5

In its CTA documents, FreeAlliance designated itself the Team Lead 

for the CTA. Additionally, FreeAlliance stated it would be [ 

] AR 

654. FreeAlliance included in its proposal a DCAA “Independent Audit 

Report on FreeAlliance LLC’s Preaward Accounting System Design.” AR 

666. The DCAA report stated, [

] AR 668. The report listed 

the capabilities of the FreeAlliance accounting system, including but not 

limited to [

] AR 674. 

Neither HealthTech nor Nish [ ]. Instead, for 

HealthTech and Nish, the FreeAlliance CTA chose to use a third-party CPA 

to verify their accounting systems. Neither verification was submitted on a 

third-party CPA letterhead. Instead, both verifications were on a brief form, 

not furnished by the agency. The form recites that “[i]n support of the CIOSP3 Ramp On proposal, the below company has been or is proposed as part 

of the Contractor Team Arrangement. Determination of compliant and 

adequate accounting system is marked necessary for performance under this 

subcontract. This form or representative certification is therefore [required].”

AR 675-76.

In section one, the HealthTech verification provided the name, title, 

signature, and contact information for a HealthTech representative. Form 

 

5 To facilitate awards to small business concerns under the RFP, the 

contracting officer was allowed to divide offerors into groups based on their 

socio-economic categories and to make award decisions based on a separate 

evaluation of each offeror in a group. In this instance, the agency divided the 

HUBZone offerors into a group and the FreeAlliance CTA was evaluated 

during NIH’s review of HUBZone proposals.
6

language in section two recited, [

] and, [

]. AR 675. In section three, form language provided [

] however, a third-party 

accounting firm review was conducted and the accounting system found to 

be adequate.” Id. The form listed [ ] as the 

“Auditor” with a name, title, signature, and contact information for a point 

of contact in section three. A footnote on the form indicated that “Healthtech 

Solutions’ accountant [ ] utilizes a DCAA compliant 

version of [ ] and HealthTech has purchased a DCAA compliant 

time keeping system from [ ]. Additionally, HealthTech has engaged [

] to conduct a third-party review of the design of 

accounting system controls in place.” Id.

Nish’s verification used the same form: it began with the name, title, 

signature, and contact information for a point of contact at Nish in section 

one. The form [

] AR 676.

Nish did not provide any [

] In section three, the form language reflected that [

] however, a third-party 

accounting firm review was conducted and the accounting system found to 

be adequate.” Id. The form listed [ ] as the “Auditor” 

with a name, title, signature, and contact information for a point of contact. 

Nish’s verification did not include supplemental notes.

NIH Phase One Evaluation: FreeAlliance Eliminated

Upon receiving the proposals, NIH began evaluating HUBZone 

offerors under the phase one Go/No-Go requirements. As part of the agency 

evaluation, NIH asked offerors that proposed as a CTA whether they 

proposed as a FAR part 9.601(1) or 9.601(2) CTA. An agency evaluates a 

FAR part 9.601(1) CTA as one team, evaluating each member’s 

qualifications. On the other hand, in a FAR part 9.601(2) CTA, the agency 

will only evaluate the prime contractor’s qualifications. FreeAlliance replied 

that it proposed as a FAR part 9.601(1) CTA. NIH evaluated each member

of the CTA based on the four Go/No-Go requirements, including the 

verification of an adequate accounting system. 

NIH gave the FreeAlliance proposal an “unacceptable” rating based 

on (1) the failure of its two CTA members to submit verifications on CPA 
7

letterhead and (2) their failure to verify that the accounting system “has been 

audited and determined adequate for determining costs applicable to the 

contract in accordance with FAR 16.301-3(a)(1) as is required.” AR 807.43. 

The agency stated that FreeAlliance provided its own forms with a 

CPA signature and contact information, but those forms were not on 

letterhead of a third-party CPA. NIH noted that the verification “simply 

stated that the accounting system was found to be adequate; it does not state

that the accounting has been audited and determined adequate for 

determining costs applicable to the contract in accordance with FAR 16.301-

3(a)(1) as is required.” AR 807.43. Thus, NIH wrote, “[i]n accordance with 

section M.2.a(2), the Agency finds the proposal unacceptable and ineligible 

for award.” Id. NIH informed FreeAlliance of its elimination from the 

evaluation process on August 3, 2016. 

NIH Treatment of Other Offerors

Plaintiff alleges that NIH evaluated offerors unequally during its 

review of the four Go/No-Go requirements, deeming other deficient 

verifications as acceptable or engaging in discussions. In its briefing, plaintiff 

relies on the following phase one evaluations to demonstrate unequal 

treatment. 

[ ] submitted a verification of adequate accounting system that 

was not on CPA firm letterhead and that was not signed by a CPA. Instead, 

[ ] submitted a Standard Form (“SF”) 1408 prepared by [

] third-party CPA. NIH marked [ ] acceptable for the 

Go/No-Go requirements factor two verification of an adequate accounting 

system. 

[ ] did not reference FAR part 16.301-3(a)(1) nor did it use the 

language “audited or reviewed” in its verification of adequate accounting 

system. NIH marked [ ] acceptable for the Go/No-Go 

requirements factor two verification of an adequate accounting system. NIH 

is currently revisiting its assessment of the four Go/No-Go requirement 

factors for [ ] as the consequence of a still-pending GAO protest. 

[ ] faxed a verification of adequate 

accounting system certification form from a third-party CPA that was not on 

CPA firm letterhead. NIH nevertheless marked [

] acceptable for the Go/No-Go requirements factor two 
8

verification of an adequate accounting system. Despite NIH marking [

] verification acceptable, NIH ultimately deemed the [ ] CTA 

unacceptable under the Go/No-Go requirements factor one, because it failed 

to submit the required CTA agreements. 

[ ] did not reference FAR part 16.301-3(a)(1) in its 

verification of adequate accounting system and did not provide any 

substantive verification in its submission. NIH marked [

] acceptable for the Go/No-Go requirements factor two 

verification of an adequate accounting system. Yet [

] CTA, like [ ], was determined unacceptable for Go/No-Go 

factor one for overall compliance. NIH now takes the position that the 

accounting verification submitted by [ ] was in fact inadequate. 

A number of offerors’ verifications of an adequate accounting system 

did not explicitly cite FAR part 16.301-3(a)(1) in their verification. Yet NIH 

marked the following offerors acceptable for the Go/No-Go requirements 

factor two verification of an adequate accounting system: [

].

Several offerors’ verifications of an adequate accounting system were 

signed by the CPA firm rather than signed by a CPA. Nevertheless, NIH 

marked these offerors acceptable for the Go/No-Go requirements factor two 

verification of an adequate accounting system: [

]. On the other hand, [

] and [ ] submitted verification of 

an adequate accounting system on an individual CPA’s letterhead rather than 

a CPA firm’s letterhead. NIH also marked these offerors acceptable for the 

Go/No-Go requirements factor two verification of an adequate accounting 

system. Shivoy submitted a duplicative SBA Program Representation form 

rather than a verification of adequate accounting system on any letterhead. 

NIH marked Shivoy’s verification acceptable. 

Still other offerors received a “Go–with clarification” rating under 

Go/No-Go requirement factor one overall compliance, which plaintiff argues 

also demonstrates unequal treatment or NIH engaging in improper 

discussions. Among these offerors, [

] did not provide a DUNS number as 

required by the RFP prior to award. [ ]
9

failed to state that the replacement of a CTA member is subject to 

government approval. [

] did not acknowledge Amendment 0004 as required by 

the RFP. [

] failed to acknowledge agreement with the RFP’s terms, 

conditions, and provisions. [

] did not include the 360-day acceptance period in their 

offers. 

Finally, NIH requested the CPA license number of [

] verifying CPA due to NIH questioning whether he was in fact a CPA. 

NIH marked [ ] acceptable for the Go/No-Go 

requirements factor two verification of an adequate accounting system.

Subsequent Proceedings

FreeAlliance filed a protest at the Government Accountability Office 

(“GAO”) on August 15, 2016. FreeAlliance argued that the agency’s 

exclusion of its proposal amounted to a non-responsibility decision that 

should have been referred to the Small Business Administration. On 

November 10, 2016, GAO denied the protest. AttainX, Inc.; FreeAlliance, 

LLC, B-413104.6, 2016 CPD ¶ 330 (Comp. Gen. Nov. 10, 2016). GAO 

found:

[T]he agency’s elimination of [FreeAlliance’s proposal] from 

further consideration was not based on any evaluated problems 

with the accounting systems of the respective CTA members . 

. . . Rather the record shows that NIH rated the proposals 

unacceptable based on the fact that both protestors failed to 

submit the specific documentation required by the RFP . . . .

AR 1672. 

Plaintiff filed its suit here on June 13, 2017. Plaintiff’s complaint 

alleges that NIH acted arbitrarily and capriciously when it failed to seek 

clarification of the FreeAlliance proposal; failed to refer its decision to the 

SBA for a Certificate of Competency determination; and eliminated the 

FreeAlliance proposal for an alleged clerical error rather than on its 

substance. After the filing of the Administrative Record, plaintiff moved for 

judgment on the administrative record. Plaintiff argues that NIH acted 
10

arbitrarily and capriciously by finding its proposal unacceptable and that the 

FreeAlliance proposal received unequal evaluation in violation of federal 

procurement principles. Defendant filed a cross-motion for judgment on the 

administrative record. 

DISCUSSION

This court has jurisdiction over challenges brought by interested 

parties to actions taken by federal agencies in connection with pre- and postaward procurement actions. See 28 U.S.C. § 1491(b)(1) (2012). To prevail, 

the protester must establish that the agency acted arbitrarily and capriciously, 

abused its discretion, or conducted itself in a manner that is otherwise not in 

accordance with law. Id. § 1491(b)(4) (mandating that the court review 

agency decisions pursuant to the standards set forth in the Administrative 

Procedures Act, 5 U.S.C § 706 (2012)). Our standard of review is a 

deferential one, requiring only that the agency had a rational basis for its 

decision and observed any applicable law or regulation during the 

procurement process. Weeks Marine, Inc. v. United States, 575 F.3d 1352, 

1358 (Fed. Cir. 2009). Even if a reasonable person might have reached a 

different conclusion, we will not set aside the agency’s determination unless 

the protestor can show some irrationality or violation of law or regulation. 

Redland Genstar, Inc. v. United States, 39 Fed. Cl. 220, 231 (1997). Plaintiff 

must also “show that it was prejudiced by a significant error in the 

procurement process,” by demonstrating that, had it not been for the error, 

plaintiff had a reasonable likelihood of being awarded the contract. Labatt 

Food Servs., Inc. v. United States, 577 F.3d 1375, 1378 (Fed. Cir. 2009). To 

carry its burden, FreeAlliance advances three arguments regarding the 

agency’s evaluation of its bid under the Go/No-Go requirements. 

I. Whether The Agency Was Arbitrary And Capricious When It 

Excluded FreeAlliance For Noncompliant Verifications Submitted By 

HealthTech And Nish

First, plaintiff argues that the agency was arbitrary and capricious 

when it excluded HealthTech’s and Nish’s verifications as noncompliant 

with the requirements of the RFP. The government responds that HealthTech

and Nish submitted facially noncompliant verifications based on the 

language of the RFP. 

In the procurement process, the offeror is responsible for ensuring its 

proposal complies with the requirements of solicitation; the agency has no 
11

duty to correct an offeror’s mistakes during the procurement process. See 

Mercom, Inc. v. United States, 131 Fed. Cl. 32, 40 (2017). The RFP provided 

four options for verifying an adequate accounting system: DCAA audit, 

DCMA audit, a federal civilian agency audit, or a third-party CPA audit. The 

first two options demonstrate that the agency was seeking substance in its 

verification of an adequate accounting system. A DCAA or DCMA audit 

would be performed according to a standard that would assure the 

government that the offeror could adequately track and account for its costs 

under a cost reimbursement contract. FreeAlliance itself elected to submit to

a DCAA audit, which provided a detailed review of the adequacy of its 

accounting system to determine costs applicable to a contract. 

On the other hand, FreeAlliance’s CTA members submitted 

verifications using the third-party CPA option. Any verification was required 

to provide that the system have been “audited and determined adequate for 

determining costs applicable to this contract in accordance with FAR 16.301-

3(a)(1).” AR 496. In addition, when using a third-party CPA, “the 

verification letter shall be on the letter head of the third-party CPA firm . . . 

.” Id. Neither HealthTech nor Nish provided a verification on CPA 

letterhead. The origin of their verification forms is uncertain; FreeAlliance

stated during oral argument that they were likely from a past solicitation.

As to the substance of the verifications, HealthTech’s verification 

states that a DCAA audit [ ]. Form language at 

section three recites that “a third-party accounting review was conducted and 

the accounting system found to be adequate.” AR 675. HealthTech states in 

a footnote, however, “HealthTech has engaged [

] to conduct a third-party review of the design of accounting system 

controls in place.” Id. Plaintiff asserts that, taken together, these sentences 

mean that a review occurred by [ ] prior to the 

verification submission. The government responds that NIH understood the 

language, “has engaged” the CPA “to conduct” a review, to mean that the 

review had not yet taken place at the time of submission. Neither the form 

language nor the footnote recites whether the system was adequate for 

determining costs for a cost reimbursement task order.

Although both readings may be reasonable, FreeAlliance had the 

responsibility of meeting the RFP requirements and now bears the burden to 

prove that the agency was arbitrary and capricious in excluding its proposal 

for noncompliance. We accept the government’s insistence on compliance 

with the letterhead provision, because the letterhead adds credibility to the 
12

third-party verification as contrasted with plaintiff’s form, which is devoid 

of any comparable authentication. Further, the agency did not act arbitrarily 

when it read HealthTech’s footnote to mean that the required verification had 

not yet occurred. HealthTech’s verification was noncompliant due to its lack 

of third-party CPA letterhead. When the format error is combined with the 

ambiguous, limited substance, NIH chose a reasonable response of deeming 

the verification unacceptable.

Nish submitted the same verification form as HealthTech, but its 

verification form [ ]. A CPA signed after the 

statement, “[H]owever, a third-party accounting firm review was conducted 

and the accounting system found to be adequate.” AR 676. Nish’s 

verification similarly lacks a CPA letterhead and provides no detail regarding 

the depth or type of review or that the system is adequate for determining 

costs applicable to the contract. Due to the deficiencies, the agency’s review 

of this form was not arbitrary. 

FreeAlliance argues that, as it had designated itself as Team Lead and

[ ], its accounting 

verification should be given more weight than its accompanying CTA 

members’ verifications. Yet the RFP did not provide an exception for 

compliant verifications if a firm was not the CTA Team Lead. All members 

of the CTA were required to provide verification of an adequate accounting 

system. Thus, the agency was not arbitrary or capricious in applying the 

language of the instructions set out in the RFP to find the HealthTech and

Nish verification unacceptable.

II. Whether The Agency Evaluated Offerors’ Verification Of Adequate 

Accounting System Unequally

Plaintiff next argues that the agency did not consistently apply the 

same standard for an acceptable accounting system verification to other 

offerors. Plaintiff points to several categories of what it contends was 

unequal treatment, including NIH deeming acceptable verifications that

lacked substance, lacked citation to FAR part 16.301-3(a)(1), lacked 

signature by a CPA firm rather than a CPA, or provided an individual CPA’s 

letterhead rather than a firm letterhead.

It is a foundational principle that “a contracting agency must treat all 

offerors equally, evaluating proposals evenhandedly against common 

requirements and evaluation criteria.” Banknote Corp. of Am. v. United 
13

States, 56 Fed. Cl. 377, 383 (2003), aff'd, 365 F.3d at 1345. Here, we find 

that the contracting agency treated FreeAlliance equally with the other 

offerors. Among the verifications that plaintiff relies on to demonstrate

unequal treatment, no verification that NIH found acceptable was identical 

to the form that HealthTech and Nish submitted. 

Nevertheless, some of the verifications involved deficiencies similar 

to those for which FreeAlliance was excluded. Most concerning among the 

offerors plaintiff highlights are [ ] (a [

] CTA member) and [

] (a [ ] CTA member). [ ] provided a verification on 

CPA firm letterhead that stated the firm had reviewed [ ] financial 

statements and noted that [ ] used a contractor accounting 

software. The government concedes in its response to plaintiff’s motion that 

[ ] verification was unacceptable, despite a pre-decisional 

spreadsheet reflecting that the verification was acceptable. Although NIH 

marked the verification acceptable, the [ ] CTA did not 

receive a “Go” for phase one because, during the same evaluation, NIH 

marked the proposal unacceptable under factor one for compliance with the 

RFP requirements. Defendant thus contends that the preliminary rating, 

although indeed inconsistent with plaintiff’s treatment, should be ignored.

Similarly, [ ] submitted a faxed certification from a third-party that

was not on letterhead. The government argues that, even though the predecisional spreadsheet marked [ ] submission acceptable, [ ] was 

in fact excluded under factor one because its proposal was not otherwise 

compliant. Plaintiff also points out that [ ] CTA member [ ]

submitted a nonresponsive document unrelated to the required verification

rather than a compliant accounting system verification. Regarding [ ], the 

government responds that the pre-decisional spreadsheet made note of the 

deficiency. 

Plaintiff asserts that it is irrelevant that the [ ] CTA

and the [ ] CTA did not advance to the phase two evaluation due to factor 

one noncompliance. NIH unequally evaluated its proposal as compared to 

the [ ] CTA and the [ ] CTA, plaintiff 

argues, because FreeAlliance’s CTA members were marked unacceptable for 

noncompliant verifications whereas [ ] and [ ] were marked 

acceptable for likewise noncompliant verifications. The government 

responds that four reviewers simultaneously evaluated the four phase one 

Go-No/Go requirements and, even in the event that mistakes were made
14

regarding individual CTA member’s submissions, the final “Go” or “No-Go” 

for overall compliance should be controlling.

The administrative record, to which this court is limited in its review, 

does not discuss how the review occurred or how the pre-decisional 

spreadsheet was developed. See Rules of the Court of Federal Claims 52.1. 

We are reluctant, however, to hold that unequal treatment was present here 

when the apparent unequal treatment is embedded in a single, larger 

evaluation phase, the net outcome of which is that the other offerors were 

rejected. None of the offerors with noncompliant features in their proposals 

that FreeAlliance relies on proceeded to phase two evaluation. 

FreeAlliance also asserts that NIH unequally evaluated other offerors’ 

verifications with respect to the substance of their representations. Our 

review of the record, however, indicates that, as detailed below, NIH had a 

rational basis for accepting each verification based on its substance. 

[ ] (a [ ] CTA 

member) submitted a SF 1408 prepared by a third-party CPA, detailing [

] accounting system methods and capabilities. The SF 1408 is 

a government form utilized by DCAA and requested by the RFP. Plaintiff is 

correct that the third-party CPA did not use the language “audited” or 

“reviewed,” but the CPA did represent that the accounting system was 

acceptable, noting a specific list of the current accounting system features 

and that the offeror was updating the system. Plaintiff’s verifications, by 

contrast, were not on a standard government form, and the form plaintiff 

chose lacked any details about the purpose of the review or the adequacy of 

the accounting systems for any relevant purpose.

Plaintiff asserts that [ ] (an [ ]

CTA member) did not provide a responsive verification. The government 

responded that the [ ] Go/No-Go evaluation is currently under 

review due to a bid protest. In the context of this protest, however, [

] is distinguishable from FreeAlliance’s verifications. [

] complied with the letterhead requirement. Also, although its

CPA stated “[w]e have not audited, reviewed, or performed internal control 

reviews of the LLC in the past,” he continued, “we believed their accounting 

and billing systems can adequately track contracts costs and billings for the 

purpose of providing to us the information necessary to prepare the LLC’s 

annual income tax returns.” Although [ ] could have submitted a 

more substantial verification, at a minimum it provided NIH more substance 
15

in its verification than FreeAlliance’s forms. 

During oral argument, FreeAlliance also pointed to [

] and [ ] as examples of disparate treatment. The 

third-party CPA letter for [ ] was on CPA firm letterhead and 

signed by an individual CPA who stated that [ ] “has more 

than an adequate accounting system for government contracting.” AR 978. 

The letter also represented that the accounting system could accumulate and 

report costs and that it was DCAA compliant ready. 

[ ] verification was on letterhead, described [

] accounting system, and stated that the letter was prepared using 

procedures specified in the SF 1408. [ ] verification

discussed in detail the ability of [ ] accounting system to 

verify, track, and report costs. Thus, these two verifications differ from 

HealthTech and Nish due to the letterhead compliance and because they 

provided more detail than either HealthTech or Nish. The two letters also did 

not create ambiguity regarding the origin of the form, who wrote the content, 

or whether a review had taken place prior to submission.

At oral argument, FreeAlliance also alleged that [ ] provided the 

same form for verification as HealthTech and Nish. In fact, the [ ] form 

was more detailed than the Nish form because it stated that the accounting 

system was adequate “for cost type federal contracts.” AR 1209. More 

importantly, NIH deemed the [ ] form unacceptable. 

Plaintiff is correct that some accepted verifications used language 

ranging from “audit” to “review” to “verify.” Despite the individuality in 

other offerors’ verifications, each is distinguishable from the forms 

submitted by HealthTech and Nish in that the other offerors provided more 

context and detail to demonstrate to NIH that the accounting system had been 

reviewed for its ability to track costs for a cost reimbursement contract. When 

considering a Go/No-Go factor that was directly relevant to the type of 

contract contemplated, NIH did not abuse its discretion or unequally evaluate 

offerors when it determined that FreeAlliance missed the mark in both form 

and substance.

Plaintiff also points out that several offerors did not explicitly 

reference FAR part 16.301-3(a)(1) in their verifications. The RFP did not 

require an explicit reference to the FAR provision, however. Nor was 

FreeAlliance excluded for the lack of such a citation. NIH employed its 
16

discretion in determining which verifications provided sufficient assurance 

of compliance with the substance of the FAR provision.

Plaintiff also lists several offerors who submitted verifications signed 

by a CPA firm rather than an individual CPA. Plaintiff argues that the RFP

required the verification be “certified by a certified public accountant,” not 

by a CPA firm. AR 496. The government argues in its motion that it is 

standard practice in the field of accounting to use the firm’s signature rather 

than an individual’s signature and that NIH was aware of this practice.6

Plaintiff is correct that this practice is not referenced in the administrative 

record. Yet regardless of whether an individual or firm signed the 

verification, the offerors plaintiff points out did submit verifications with a 

CPA signature of some kind. We are not persuaded that acceptance of a CPA 

firm’s signature was an abuse of discretion by NIH.

III. Whether The Agency Engaged In Improper Discussions With Other 

Offerors Or Was Required To Engage In Discussion With 

FreeAlliance

Plaintiff alleges that NIH engaged in improper discussions with other 

offerors, with the result that those offerors proceeded to the phase two 

evaluation. Plaintiff argues that the agency ought to have notified 

FreeAlliance that it could clarify its verifications. We note initially that the 

government is correct in its response that the record reflects no “discussions”

with other offerors, as defined by the RFP or FAR part 15.306. The agency 

engaged in only clarifications to correct minor clerical points in proposals, 

which is permissible under FAR part 15.306(a). Second, plaintiff has not 

submitted any document in verified form suggesting that it could have 

satisfied the verification requirements.

Plaintiff’s argument that the agency engaged in improper discussion 

with [ ] fails, because the agency was verifying the 

information submitted, not requesting a change. [ ]

submitted a verification from a third-party firm, [ ], on 

that firm’s letterhead, discussing the accounting system and attaching a 

 

6 The government references the “American Institute of Certified Public 

Accountants (AICPA) Statements on Auditing Standards AU paragraph 

508.08, which requires the hand written or the printed signature of the 

auditor’s firm.” Def.’s Cross-Motion J. Admin. R. 28-29.
17

completed SF 1408. Upon review, an agency employee noted “may not be a 

CPA, is Govt Contracting Consultant. [sic] Natalie requesting CPA License 

Number.” AR 807.10. Rather than requesting additional substance or a new

compliant submission, the agency was confirming the CPA license number 

of the person who signed the verification. That was a permissible 

clarification, not improper discussion.

By comparison, if we accepted plaintiff’s argument, NIH would have 

requested HealthTech and Nish to resubmit their verifications to include a 

letterhead and more detail regarding whether a review of their accounting 

systems had occurred and the content of that review. Instead of confirming 

already-provided information, NIH would have allowed FreeAlliance to alter 

its verification—an opportunity that NIH expressly denied to Fedscale. AR 

941.43.

Plaintiff also points to several offerors who received phase one “Go—

with clarification,” but who would be required to provide their DUNS

number before award. Others did not include the 360-day acceptance period 

in their offers or did not acknowledge Amendment 0004 as required by the 

RFP. Still others would be required to acknowledge their agreement with the 

RFP’s terms, conditions, and provisions and that the government must 

approve any CTA member replacement. The government responds that these 

offerors received “Go—with clarification” in phase one, because each of 

these deficiencies were either minor clerical errors or acknowledgments that

would be required again later in the acceptance process. 

We agree that the agency did not abuse its discretion by allowing these 

offerors to move forward as “Go—with clarification.” These requirements 

are all distinguishable from the verification of an adequate accounting 

system, which is a substantive step toward demonstrating preparedness for 

contract award rather than a number or acknowledgment that could be 

clarified without changing the substance of an offeror’s proposal. The agency 

was not required to extend HealthTech or Nish the opportunity to correct its 

verification and we will not substitute our judgment for the agency’s to allow 

corrections now.

CONCLUSION

The agency’s actions were not arbitrary and capricious, an abuse of 

discretion, or otherwise in violation of law. Accordingly, plaintiff’s motion 

for judgment on the administrative record is denied. Defendant’s cross-
18

motion is granted. The Clerk is directed to enter judgment for the defendant. 

No costs. 

s/Eric G. Bruggink

Eric G. Bruggink

Senior Judge