Inside Perspecta's protest of $7.6B DEOS cloud contract

Perspecta's protest against General Dynamics' win of the $7.6 billion Defense Enterprise Office Solutions contract raised several questions that led to the award getting pulled back.

Copies of Perspecta’s protest filings obtained by WT from the Government Accountability Office are heavily redacted, but do describe corrective actions the General Services Administration is taking and shed more light on where in Perspecta’s protest hit home.

As we reported earlier this week, the corrective actions are already in the works as GSA and the Defense Information Systems Agency have issued a new draft solicitation. Expectations are that a final solicitation will be out in time for a new award in late January or early February.

General Dynamics IT won the DEOS contract in late August and Perspecta quickly protested. DISA is leaning on GSA to award the contract as a blanket purchase agreement via the Schedule 70 vehicle.

Perspecta’s protest was dismissed by GAO on Oct. 7, when GSA and DISA decided to take the corrective actions to address Perspecta’s complaints. WT submitted a records request for a copy of Perspecta’s protest, plus communications between GAO and the GSA-DISA team.

Two months, we received Perspecta’s heavily redacted protest filing and a supplemental filing. We also have GSA’s memo to GAO describing its corrective action plan and requesting that the protest be dismissed. The other item we obtained is GAO’s memo explaining why it dismissed the protest, which basically rehashes GSA’s memo.

GSA's memo says it and DISA will take these steps:

• Change requirements in the solicitation to make sure it accurately reflects current needs.
• Bidders would be allowed to submit revised bids.
• After revised bids are submitted, GSA and DISA “may confer” with bidders to clear up quotation details.
• Make sure bidders are treated fairly and consistently.
• The revised bids will be evaluated on non-price factors. Then GSA will conduct a new tradeoff analysis to pick the winner that represents the best value.

Finally, GSA said it would conduct a “fact finding” to examine Perspecta’s allegations of unfair competitive advantage and an organizational conflict of interest. GSA would report their findings back to the bidders before making a new award.

These steps should correct the errors Perspecta raised in its protest, GSA said.

Neither the GSA and GAO memos go into details of Perspecta’s protest. But the unredacted portions of Perpsecta’s protest documents offer some hints at what the company disagreed with.

For example, Perspecta argues that weaknesses assigned to its proposal were evidence of “disparate treatment.” The part of its proposal Perspecta is referring to and other related details are blacked out. But I use that as an example, because GSA’s corrective action document specifically mentions the need to address unequal treatment of bidders.

What is rated as a weakness has a cascading effect during evaluations and is something that is difficult for companies to overcome, even if their pricing is lower than the bidder with a stronger evaluation.

The conflict of interest allegations also are redacted but a footnote in Perspecta’s filing says that the company isn’t alleging that this person (a former DISA employee) knowingly disclosed confidential information.

“But intent is not a relevant consideration in the ‘unfair competitive advantage’ analysis. Prejudice is presumed whenever a former agency official with competitively-useful, nonpublic information supports a capture effort because even those with the best of intentions cannot avoid using their inside knowledge to shape the opinions they have and the advice they provide," Perspecta's filing says.

Perspecta is essentially arguing that the mere presence of this person working on the capture effort is evidence of an unfair advantage for GDIT.

One of the frustrating parts of such a heavily-redacted document is knowing are getting close to learning something, but the big black bars get in the way.

The section where Perspecta attacks the best value determination offers some near-tantalizing details:

“Putting aside the materially flawed BLACKED OUT evaluation, the decision that a perceived BLACKED OUT was worth the BLACKED OUT remains improper,” Perspecta wrote.

This argument from Perspecta comes shortly afterward:

“Given the limited technical variability in the proposed solutions, and considering the fact that Perspecta BLACKED OUT, the decision to make award BLACKED OUT is not only unreasonable but also fiscally irresponsible.”

Then in the next paragraph, Perspecta writes this:

“In fact, the Agency’s decision that [GDIT’s] perceived advantage BLACKED OUT is worth BLACKED OUT reflects an unlawful deviation from the evaluation factor weightings established in the solicitation.”

Those sentences leave me to wonder wonder a lot of things. Is Perspecta saying that GDIT bid a higher price? Is that why they are calling it “fiscally irresponsible?” Perspecta also seems to be arguing that if its technical evaluation was done fairly, then GSA and DISA would not have been justified in paying the higher price for GDIT’s solution.

I think that is what they are saying anyway. It important to note that this is just Perspecta’s side of the story. GDIT never weighed in. GSA or DISA did not offer a response, other than to say they some things that need to be fixed. Perspecta, GDIT, GSA and DISA all declined to comment on DEOS.

One thing is I’d wager on: the loser of this next round is sure to protest.