Most Expensive Contractor Wins Bid Protest; Three Cheaper Competitors were Vague on Subcontractor Use.

Despite being the most expensive of four bidders, a contractor bidding to install fiber optic cable in Jordan wins its bid protest.  This case is a lesson on the use of subcontractors in a small business set-aside contract.  A company must be specific, on the fact of its proposal, as to who in the company is going to really be doing the work.  This is not a time to be vague.

In this case, Technical Communications Solutions Corporation (“TCSC”) initially won the contract, besting three other higher priced competitors for a small-business set aside on a “low price technically acceptable” basis.  It was the cheapest.  The most expensive bid was by Hyperion, Inc.

Hyperion protested the award, complaining that the other three, cheaper competitors intended to have subcontractors perform most of the work.  Thus, they weren’t “technically acceptable.”  The government responded that, on the face of the proposals, each cheaper company “could” have performed most of the work.  The issue for the court was “would” the cheaper companies do most of the work.

The Court of Federal Claims examined each proposal and concluded that, at best, each cheaper company was vague as to the extent of its intended subcontractor use.  As to TCSC, it appeared that the company mingled categories of “labor” with “materials.”  To the Court, it just didn’t seem credible that any of them really would use supply more than 50% of the labor.  The fact that the proposals of the cheaper companies didn’t specifically list the employees who would be doing the work really stood out to the Court.

Hyperion won the bid protest and was awarded its costs.  The case is Hyperion, Inc. v. United States, 13-1012C (April 17, 2014).  Cy Phillips of May Law was the trial lawyer for Hyperion.

Scroll to Top