Source: https://www.arnoldporter.com/en/perspectives/publications/2018/06/gao-sustains-oracles-ot-authority-protest
Timestamp: 2018-07-22 01:05:34
Document Index: 664018230

Matched Legal Cases: ['§ 2371', '§ 2371', '§ 2371', '§ 2371', '§ 2371', '§ 2371']

GAO Sustains Oracle's Other Transaction Authority (OTA) Protest | Publications and Presentations | Arnold & Porter
In June 2016, DIUx published a Contracting Officer's Statement (CSO) under § 2371b seeking to "award[] funding agreements … to carry out prototype projects" related to solving this problem.12 DIUx published a consolidated, updated announcement in March 2017 and received 21 solution briefs, including one from eventual OTA awardee REAN, and, notably, not including one from Oracle.13 In May 2017, the Government executed a determination and findings (D&F) to approve the use of its OTA authority under 10 U.S.C. § 2371b to award a prototype OTA agreement to REAN.14
In November 2017, the Government concluded that REAN had "performed the requirements" of the prototype OTA award despite the fact that work was still ongoing on one of the OTA award's modifications.15 On February 1, 2018, the Government executed a second D&F concluding that the requirements of § 2371b had been met such that that Agency could grant a follow-on production OTA (P-OTA) award.16
The Agency posted the notice of award to REAN on February 12, and Oracle protested the P-OTA award at GAO on February 20.17 While Oracle's protest contained a number of grounds, GAO addressed three major points—(1) whether Oracle was an interested party to protest the P-OTA award; (2) whether the underlying prototype OTA agreement provided for the follow-on award of a P-OTA; and (3) whether the initial prototype project was "successfully completed," so as to allow a follow-on P-OTA award.18
As to whether the underlying prototype OTA agreement provided for the follow-on P-OTA award, GAO focused on the statutory text. Under § 2371b(f)(1), an agency's prototype OTA solicitation may "provide for" the sole-source award of a follow-on production contract to the recipient of the prototype OTA. Since the prototype OTA in this case did not mention "follow-on production," GAO found that the Agency lacked the statutory authority to award the P-OTA.22
Next, GAO also found that the prototype project was not "successfully completed," as required by § 2371b(f)(2)(B) in order to award a P-OTA without competition.23 While the Agency acknowledged that work was ongoing on modification 5 of the prototype project, the Agency contended that REAN had completed those aspects of the prototype project that were included in the prototype OTA award as initially issued.24 GAO found that the statute required successful completion of "the prototype project provided for in the transaction," meaning the entire prototype project as modified.25
GAO recommended that the Agency terminate the P-OTA award to REAN and "review its procurement authority" in accordance with GAO's decision to either conduct a new procurement under competitive procedures, prepare the appropriate justification to award a contract without competition, or properly award an OTA agreement in accordance with § 2371b.26