requirement will only be considered when it can be determined prior to award that the material or service being offered will meet the Air Force's requirement. . . ." (§ M-25).
Mil-Com is a qualified supplier of TEMS for the A-10 aircraft, but was not qualified to supply TEMS for the KC-135 at the time the RFP was issued. In an attempt to become qualified, Mil-Com began the approval process on May 25, 1988, submitting a test unit to the Air Force. The plaintiff's TEMS unit was tested for use on the KC-135 in August, 1988. The results of the testing were negative.
In October, after defendant had issued the RFP (with its extra-normal qualification procedure), Mil-Com produced further technical data to the Air Force; after review of these submissions, the Air Force decided that plaintiff's product could be used on the KC-135, but only upon the successful completion of "first article submission testing" before or during the initial stage of production. However, the RFP at issue in this case did not provide for first article submission testing, and therefore, defendant determined that plaintiff did not qualify for award under the RFP. Thereafter, on November 10, defendant awarded an undefinitized contract action ("UCA") to Northrop for delivery of the TEMS units.
Plaintiff argues that the sole-source award to Northrop was in contravention of various statutes and regulations. It alleges that the contracting officer's decision with respect to plaintiff's qualification was an illegal ex post facto alteration of the terms of the RFP, since Section M-25 of the RFP limited evaluation to the technical data submitted by plaintiff in support of its offer.
2. Standard of Review
Judicial review of procurement actions under the Administrative Procedure Act is based on the administrative record; the ultimate award of a contract is left to agency discretion, and the courts should exercise restraint in reviewing such decisions. The D.C. Circuit has held that procurements should be left undisturbed unless the Court can find no rational basis for the agency's decision. M. Steinthal & Co. v. Seamans, 147 U.S. App. D.C. 221, 455 F.2d 1289 (D.C. Cir. 1971). Furthermore, plaintiffs seeking to have procurement contracts set aside must show, in addition to a lack of rational basis, a clear and prejudicial violation of applicable statutes or regulations. Kentron Hawaii, Ltd. v. Warner, 156 U.S. App. D.C. 274, 480 F.2d 1166, 1169 (D.C. Cir. 1973).
Plaintiff's case depends on two issues: (1) whether defendant followed proper procedures in awarding the UCA to Northrop, and (2) whether Mil-Com was a qualified offeror of TEMS for the KC-135. As mentioned above, the normal method for testing qualification in procurement matters is first article testing, but the RFP in this case bypassed that stage due to the urgency of the requirement. Penny Andersson Decl. para. 17. Instead, the RFP substituted its own procedure for determining qualification, set forth in the RFP.
Plaintiff argues that it submitted technical data in support of its request to be qualified, but that defendant abandoned the RFP and illegally awarded the UCA to Northrop. The first set of plaintiff's arguments with which the Court will deal concerns the propriety of the UCA award, and the manner in which the UCA was processed once the decision had been made to make the procurement using a UCA. Then the Court will turn to a discussion of the merits of plaintiff's arguments respecting qualification.
Plaintiff's first argument is based on 10 U.S.C. § 2326, which governs undefinitized contract actions, and permits their use only where
the request for authorization of the contractual action includes a description of the anticipated effect on requirements of the military department concerned if a delay is incurred for purposes of determining contractual terms, specification, and price before performance is begun under the contractual action.