Aspire Therapy Services & Consultants, Inc. v. United States ( 2023 )

IN THE UNITED STATES COURT OF FEDERAL CLAIMS
______________________________________
)
ASPIRE THERAPY SERVICES & )
CONSULTANTS, INC., )
)
Plaintiff, ) No. 23-253
)
v. ) Filed: May 30, 2023
)
THE UNITED STATES, ) Re-issued: June 13, 2023
)
Defendant. )
______________________________________ )
OPINION AND ORDER
Plaintiff, Aspire Therapy Services & Consultants, Inc. (“Aspire”), filed this pre-award bid
protest challenging the Defense Commissary Agency’s (“DeCA”) decision to eliminate its
proposal from further consideration in a procurement of shelf stocking, receiving/storage/holding
area, custodial, and related services at the Dover Air Force Base Commissary. The basis for
rejection was that Aspire’s number of direct labor hours reflected in two different spreadsheets
submitted with its proposal did not match. Aspire contends DeCA abused its discretion by failing
to allow it to resolve the error through clarification. Before the Court are the parties’ Cross-
Motions for Judgment on the Administrative Record. For the reasons discussed below, the Court
GRANTS Aspire’s Motion for Judgment and DENIES the Government’s Cross-Motion.
 The Court issued this opinion under seal on May 30, 2023, and directed the parties to file
any proposed redactions by June 6, 2023. The opinion issued today incorporates the proposed
redactions filed by the parties. Upon review, the Court finds that the material identified warrants
protection from public disclosure, as provided in the applicable Protective Order (ECF No. 10).
Redacted material in charts is blacked out, and redacted material in the body of the opinion is
represented by bracketed ellipses “[. . .].”
I. BACKGROUND
A. The Solicitation
DeCA issued Solicitation No. HQC00822R0023 on October 5, 2022, seeking proposals for
the award of a negotiated firm-fixed price contract for loading, stocking, and custodial work at the
Dover Air Force Base Commissary. Admin. R. 3, 87 (hereinafter “AR”).1 Commissaries are stores
similar to commercial supermarkets that sell food and other items to authorized patrons at military
bases. AR 100. To support DeCA’s commissary services, the procurement at issue requires the
selected contractor to “furnish all personnel, supervision, supplies, equipment, tools, materials and
other items and services as necessary to perform shelf stocking, receiving/storage/holding area
(RSHA), and custodial tasks . . . at the Dover Air Force Base . . . .” AR 100.
Per the solicitation, DeCA intends to use three factors to evaluate proposals: Factor 1 –
Performance Capability; Factor 2 – Past Performance; and Factor 3 – Price. AR 90–91. The
Performance Capability and Past Performance factors combined are deemed relatively equal in
importance to the Price factor. AR 91. To evaluate the Price factor, DeCA intends to use a price
realism analysis, wherein proposals will be evaluated “to determine whether offered prices are
realistic in relation to the work to be performed, reflect a clear understanding of the requirements,
and are consistent with other portions of the offeror’s proposal.” AR 92.
The solicitation required offerors to submit their proposals in three volumes through the
Procurement Integrated Enterprise Environment (“PIEE”) system. AR 86. Volume I required
offerors to break down their proposed services and prices and submit a Cost Breakout spreadsheet
1
For ease of reference, citations to the administrative record refer to the bates-labeled page
numbers rather than the ECF page numbers. Citations to the native versions of certain Excel
spreadsheets refer to the relevant tab number, as these files are not available on ECF. See Def.’s
Notice, ECF No. 24.
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via Microsoft Excel. AR 86. Volume II required offerors to provide a Technical Capability and
Personnel Proposal via PDF and a Direct and Indirect Labor Summary via Microsoft Excel. AR
87. Volume III required offerors to provide past performance information via PDF. AR 87. The
Volume I Cost Breakout spreadsheet and the Volume II Direct and Indirect Labor Summary
spreadsheet both included formulas that automatically generated various computations. AR 86.
To allow offerors to complete the computations, “the necessary inputs [were] ‘unprotected’ and
[could] be changed as needed to adequately reflect [an offeror’s] proposal.” AR 86. The
solicitation warned that “[t]he offeror is ultimately responsible for the accuracy of all calculations.”
AR 86.
The solicitation also informed offerors that they “may have to present the same
information, in the same or different format, in more than one volume.” AR 86. As such, DeCA
instructed offerors to “[e]nsure information and statements on similar topics (e.g., number of work
hours and productivity rates) are consistent throughout the proposal.” AR 86. Twice more the
solicitation instructed offerors to ensure data entries agreed across different parts of the offeror’s
proposal. AR 87 (“When completing the [Direct and Indirect Labor Summary], enter all of the
data requested, ensuring your data entries agree with the information provided in other parts of
your proposal and computations are correct.”); AR 242 (direct productive hours proposed in the
Direct and Indirect Labor Summary “should match exactly the direct productive hours shown in
your cost worksheets”). And the solicitation warned offerors twice that “[p]roposals that fail to
comply with the content or format requirements may be rejected without further evaluation.” AR
85; see AR 90 (“Proposals that fail to comply with content or format requirements specified in
Section L of this solicitation may be rejected without further evaluation.”).
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B. Aspire’s Proposal
Aspire submitted its proposal on October 15, 2022. AR 348. On January 6, 2023, DeCA
informed Aspire that it was rejecting its proposal without further consideration. AR 1106. DeCA
explained:
Your proposal failed to comply with the requirements of Section L, Provision
52.215-4509 Proposal Submission (Format and Content) (APR 2004) identified in
the solicitation and is being rejected without further evaluation due to the hours
proposed in the Volume I, Cost Breakout did not correlate with the hours in the
Volume II, Direct Labor Summary.
AR 1106.
In its Volume II Direct and Indirect Labor Summary spreadsheet, Aspire provided the
following information involving Receiving/Storage/Holding Area (“RSHA”) Direct Labor:
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AR Tab 4.b.1. (Native Excel). The original spreadsheet provided by DeCA to offerors included
the anticipated “Cases per Year” under each labor subcategory (e.g., Offload Trucks, Transport
Merchandise, etc.) in Column B, and offerors were required to input their “Productivity Rate” for
each labor subcategory in Column C. AR Tab 2.e.1. (Native Excel). The spreadsheet
automatically populated the “Direct Productive Hrs Required” in Column D by dividing cases per
year by the offeror’s provided productivity rate for each labor subcategory except “RSHA
Coverage for Contractor Work Schedule” in cell D32. AR Tab 2.e.1. For cell D32, offerors
directly entered their “Direct Productive Hrs Required,” and Aspire entered the number “81” using
the formula “=2366-2285”. AR Tab 4.b.1. The spreadsheet then automatically populated the total
“Direct Productive Hrs Required” in cell D34 for the RSHA labor category by adding the “Direct
Productive Hrs Required” for each subcategory. AR Tab 2.e.1. Based on Aspire’s inputs, its total
“Direct Productive Hrs Required” for RSHA Direct Labor totaled 2,366 hours. AR Tab 4.b.1.
In the Volume I Cost Breakout spreadsheet, offerors were again required to provide a
breakdown of RSHA labor hours. AR Tab 2.c.1 (Native Excel). Unlike the Volume II Direct and
Indirect Labor Summary spreadsheet, the Cost Breakout spreadsheet categorized hours by laborer,
not by subtasks. Aspire provided the following information in its Cost Breakout spreadsheet:
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AR Tab 4.a.1 (Native Excel). Offerors manually inputted the total hours required of each laborer
(e.g., Forklift Operator, Material Handling Laborer, etc.) as well as the total Indirect Labor Hours
in Column C. AR Tab 2.c.1. The Direct Labor Hours were then automatically calculated by
subtracting the Indirect Labor Hours from the sum of the four laborers’ hours. AR Tab 2.c.1.
In cell C16, Aspire created the following formula to populate the labor hours for the
Material Handling Laborer: “=[. . .]+[. . .]+[. . .]+[. . .]+51-[. . .]”, which resulted in a sum of [. .
.]. AR Tab 4.a.1. Aspire explains that it pulled those numbers from the RSHA direct labor chart
in its Volume II Direct and Indirect Labor Summary spreadsheet—transport merchandise ([. . .]),
segregate merchandise ([. . .]), store merchandise ([. . .]), pull merchandise ([. . .]), and RSHA
coverage for contractor work schedule (81)—as these were the tasks to be completed by the
Material Handling Laborer. Pl.’s Mot. for J. on Admin. R. at 11–12, ECF No. 21-1; see AR 468.
Critically, Aspire states that the inclusion of the number 51 in the cell C16 formula was a typo,
and it should have entered 81—the correct number from the Direct and Indirect Labor Summary
spreadsheet. ECF No. 21-1 at 12. As a result of this typo, the Material Handling Laborer hours
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were 30 hours less than intended, as were the total Direct Labor Hours in cell C26. Id. at 13.
Accordingly, the spreadsheet totaled the RSHA direct labor hours as 2,336 in the Volume I Cost
Breakout spreadsheet in contrast with the 2,366 total in the Volume II Direct and Indirect Labor
Summary spreadsheet. Compare AR 400, with AR 468. Aspire explains that had it not made an
input error causing the 30-hour difference in its Cost Breakout spreadsheet, its proposed price
would have been $[. . .] higher over five years, which amounts to a 0.063 percent increase of its
total proposed price. ECF No. 21-1 at 29.
C. Pre-Award Debrief
On January 9, 2023, Aspire requested a pre-award written debrief pursuant to subpart
15.505 of the Federal Acquisition Regulations (“FAR”). AR 1109. On February 8, 2023, DeCA
provided responses to several of Aspire’s questions about its proposal and confirmed that Aspire’s
disqualification was due to the 30-hour discrepancy in direct labor hours between the relevant
Volume I and Volume II spreadsheets. AR 1112. Specifically, DeCA explained that “[t]he total
Direct Labor in volume II of the proposal for RSHA services was 2,366 hours. The total Direct
Labor in volume I of the proposal for RSHA was 2,336 hours.” AR 1112. In response to Aspire’s
question about whether DeCA considered “asking Aspire to clarify the concern pursuant to FAR
15.306 Exchanges,” DeCA stated that “[t]he agency determined the error was not a minor clerical
error pursuant to FAR 15.306 and therefore determined clarifications could not be conducted.”
AR 1113.
D. Other Proposals
DeCA received seven other proposals in response to the solicitation. AR 247, 474, 564,
663, 779, 863. In addition to Aspire, DeCA rejected the proposals of [. . .] and [. . .] without further
consideration on January 6, 2023. AR 1105, 1108. [. . .]. AR 1105. [. . .] was disqualified
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because, like Aspire, “the hours proposed in the Volume I, Cost Breakout did not correlate with
the hours in the Volume II, Direct Labor Summary.” AR 1108. Unlike Aspire, however, the
discrepancy between the proposed hours in [. . .]’s proposal was a [. . .]-hour difference. Compare
AR 715 ([. . .] hours proposed in Volume I Cost Breakout spreadsheet), with AR 770 ([. . .] hours
proposed in Volume II Direct and Indirect Labor Summary spreadsheet).
[. . .] offered the lowest-priced proposal at $[. . .]. AR 488. Aspire’s proposed price was
the second lowest at $[. . .]. AR 394. [. . .] proposed the highest price at $[. . .]. AR 709. And [.
. .] proposed the second highest price at $[. . .]. AR 297.
E. Procedural History
On February 22, 2023, Aspire filed its Complaint alleging that DeCA’s disqualification of
its proposal was arbitrary and capricious and that DeCA abused its discretion by not allowing
Aspire to clarify the labor hour discrepancy in its proposal. See Pl.’s Compl. ¶ 30, ECF No. 1.
Aspire asks the Court to declare that DeCA’s decision was an arbitrary abuse of discretion, and
order DeCA to allow Aspire to clarify the minor or clerical error in its proposal and compete for
the award. Id. at 13 (“Request for Relief”). On March 24, 2023, Aspire filed its Motion for
Judgment on the Administrative Record seeking relief on the same bases raised in its Complaint.
See ECF No. 21-1. Aspire argues that its spreadsheet error was a minor clerical error that could
have been resolved through clarification. Id. at 19. As such, Aspire argues DeCA abused its
discretion by failing to seek such a clarification from Aspire. Id. at 34.
On April 10, 2023, the Government filed its Cross-Motion for Judgment on the
Administrative Record. See Def.’s Cross-Mot. for J. on Admin. R., ECF No. 25. The Government
argues that Aspire’s failure to match labor hours between its spreadsheets was a material error that
constituted noncompliance with the Solicitation’s terms and that could have been resolved only
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through discussions, not a clarification. Id. at 13, 19. Therefore, the Government argues DeCA
reasonably exercised its discretion when it refrained from requesting a clarification from Aspire
and instead rejected its proposal. Id. at 16.
The Motions are now fully briefed and ripe for decision. See Pl.’s Resp. in Support of Mot.
for J. on Admin. R., ECF No. 26; Def.’s Resp. in Support of Cross-Mot. for J. on Admin R., ECF
No. 27. The Court held oral argument on May 10, 2023.
II. LEGAL STANDARDS
A. Motions for Judgment on the Administrative Record
Rule 52.1(c) of the Rules of the United States Court of Federal Claims governs motions for
judgment on the administrative record. Such motions are “properly understood as . . . an expedited
trial on the record.” Bannum, Inc. v. United States, 404 F.3d 1346, 1356 (Fed. Cir. 2005). In
contrast to the standard for summary judgment, “the standard for judgment on the administrative
record is narrower” and involves determining, “given all the disputed and undisputed facts in the
administrative record, whether the plaintiff has met the burden of proof to show that the
[challenged action or] decision was not in accordance with the law.” Martinez v. United States,
77 Fed. Cl. 318, 324 (2007) (citing Bannum, 404 F.3d at 1357). Therefore, a genuine issue of
disputed fact does not prevent the Court from granting a motion for judgment on the administrative
record. See Bannum, 404 F.3d at 1357.
B. Bid Protest Standard of Review
The Tucker Act, as amended by the Administrative Dispute Resolution Act of 1996,
provides the Court of Federal Claims with “jurisdiction to render judgment on an action by an
interested party objecting to . . . the award of a contract or any alleged violation of statute or
regulation in connection with a procurement . . . .” 28 U.S.C. § 1491(b)(1). In such actions, the
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Court “review[s] the agency’s decision pursuant to the standards set forth in section 706” of the
Administrative Procedure Act. 28 U.S.C. § 1491(b)(4); see Banknote Corp. of Am., Inc. v. United
States, 365 F.3d 1345, 1350 (Fed. Cir. 2004). Accordingly, the Court examines whether an
agency’s action was “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance
with law.” 5 U.S.C. § 706(2)(A); see Impresa Construzioni Geom. Domenico Garufi v. United
States, 238 F.3d 1324, 1332 n.5 (Fed. Cir. 2001). Under such review, an “award may be set aside
if either: (1) the procurement official’s decision lacked a rational basis; or (2) the procurement
procedure involved a violation of regulation or procedure.” Impresa, 238 F.3d at 1332. To prevail
in a bid protest, “a protestor must show a significant, prejudicial error in the procurement process.”
WellPoint Mil. Care Corp. v. United States, 953 F.3d 1373, 1377 (Fed. Cir. 2020) (quoting Alfa
Laval Separation, Inc. v. United States, 175 F.3d 1365, 1367 (Fed. Cir. 1999)). A protestor
establishes prejudice by showing “that there was a substantial chance it would have received the
contract award but for that error.” Alfa Laval, 175 F.3d at 1367 (quoting Statistica, Inc. v.
Christopher, 102 F.3d 1577, 1582 (Fed. Cir. 1996)).
In reviewing an agency’s procurement decisions, the Court does not substitute its judgment
for that of the agency. See Redland Genstar, Inc. v. United States, 39 Fed. Cl. 220, 231 (1997);
Cincom Sys., Inc. v. United States, 37 Fed. Cl. 663, 672 (1997); see also M.W. Kellogg Co. v.
United States, 10 Cl. Ct. 17, 23 (1986) (holding that “deference must be afforded to an agency’s
. . . procurement decisions if they have a rational basis and do not violate applicable law or
regulations”). The disappointed bidder “bears a heavy burden,” and the contracting officer is
“entitled to exercise discretion upon a broad range of issues . . . .” Impresa, 238 F.3d at 1332–33
(citations and quotes omitted). This burden “is not met by reliance on [the] pleadings alone, or by
conclusory allegations and generalities.” Bromley Contracting Co. v. United States, 15 Cl. Ct.
10100, 105 (1988); see Campbell v. United States, 2 Cl. Ct. 247, 249 (1983). A procurement decision
is rational if “the contracting agency provided a coherent and reasonable explanation of its exercise
of discretion.” Impresa, 238 F.3d at 1333. “[T]hat explanation need not be extensive.” Bannum,
Inc. v. United States, 91 Fed. Cl. 160, 172 (2009) (citing Camp v. Pitts, 411 U.S. 138, 142–43
(1973)).
III. DISCUSSION
Aspire’s challenge to DeCA’s disqualification decision presents two questions: (1) did
DeCA rationally determine that the 30-hour difference in labor hours reflected on two spreadsheets
in Aspire’s proposal was not a minor clerical error that could be clarified pursuant to FAR
15.306(a)(2), and (2) did DeCA abuse its discretion by declining to seek clarification. The Court
agrees with Aspire on both issues. The spreadsheet error was both minor and clerical, and DeCA
abused its discretion by failing to request a clarification from Aspire.
A. Aspire Made a Minor Clerical Error that May Be Resolved through Clarification.
1. Clarifications Are Permitted to Resolve Minor or Clerical Errors.
The FAR allows procuring agencies to engage in clarifications, which are defined as
“limited exchanges, between the Government and offerors, that may occur when award without
discussions is contemplated.” FAR 15.306(a)(1) (2022). The regulations provide that “[i]f award
will be made without conducting discussions, offerors may be given the opportunity to clarify
certain aspects of proposals (e.g., the relevance of an offeror’s past performance information and
adverse past performance information to which the offeror has not previously had an opportunity
to respond) or to resolve minor or clerical errors.” FAR 15.306(a)(2) (2022).
In contrast to clarifications, discussions involve negotiations. They “are exchanges, in . . .
a competitive . . . environment, between the Government and offerors” that “are undertaken with
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the intent of allowing the offeror to revise its proposal,” FAR 15.306(d) (2022), which may include
“alter[ing] or explain[ing] to enhance materially the proposal’s potential for award,” FAR
15.306(d)(3) (2022). Discussions may also involve bargaining, which includes “persuasion,
alteration of assumptions and positions, give-and-take, and may apply to price, schedule, technical
requirements, type of contract, or other terms of a proposed contract.” FAR 15.306(d).
Discussions take place after the Government has established a competitive range; and if the
Government chooses to engage in discussions, it must do so with each offeror still under
consideration. FAR 15.306(d)(3).
Under prior iterations of the regulations, clarifications had a narrower scope. They were
previously allowed “for the sole purpose of eliminating minor irregularities, informalities, or
apparent clerical mistakes in the proposal.” FAR 15.601 (1991). That definition was significantly
broadened in 1997 to “provide for empowerment and flexibility” and to “shift from rigid rules to
guiding principles.” Info. Tech. & Applications Corp. v. United States, 316 F.3d 1312, 1321 (Fed.
Cir. 2003) (quoting Contracting by Negotiation and Competitive Range Determination, 62 Fed.
Reg. 51,224, 51,225 (Sept. 30, 1997) (to be codified at FAR 15.306)). Specifically, the 1997
amendments were intended to “[s]upport[] more open exchanges between the Government and
industry, allowing industry to better understand the [Government’s] requirement [sic] and the
Government to better understand industry proposals.” Id. (second alteration added) (quoting
Contracting by Negotiation and Competitive Range Determination, 62 Fed. Reg. at 51,224). The
current rule seeks to “allow as much free exchange of information between offerors and the
Government as possible” and “help offerors, especially small entities that may not be familiar with
proposal preparation, by permitting easy clarification of limited aspects of their proposals.” Id.
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(quoting Contracting by Negotiation and Competitive Range Determination, 62 Fed. Reg. at
51,228–29).
While the scope of clarifications has been broadened, they are nevertheless permitted only
to “clarify certain aspects of proposals” and “resolve minor or clerical errors.” FAR 15.306(a)(1).
Clarifications are not permitted to materially revise aspects of a proposal, such as technical or cost
elements, or to cure material omissions or deficiencies, which are exchanges properly reserved for
discussions. Dell Fed. Sys., L.P. v. United States, 906 F.3d 982, 998 (Fed. Cir. 2018). But the
resolution of minor or clerical errors through clarification may involve making minor corrections
to a proposal. Galen Med. Assocs., Inc. v. United States, 369 F.3d 1324, 1333 (Fed. Cir. 2004). It
may also include the provision of new or additional information, including with respect to
information that is “essential for evaluation of the proposal.” Info. Tech., 316 F.3d at 1323.
For example, the United States Court of Appeals for the Federal Circuit had held that the
correction of a mathematical error in a proposal that increased an offeror’s bid price constituted a
clarification rather than a discussion. Galen, 369 F.3d at 1333. In Galen, the plaintiff alleged that
the Government impermissibly engaged in discussions by allowing a single offeror to alter its bid
price. Id. at 1332–33. The Court held there was insufficient evidence to establish such
communications occurred but found that even if communications between the bidder and the
agency did lead to an alteration of the bid price, the change “was in the nature of a correction of
an obvious mathematical error” and “actually increased [the bidder’s] bid price.” Id. at 1333. For
these reasons, the Court held the correction “would fall squarely within the definition of
‘clarification’ rather than ‘discussion.’” Id.Following Galen, this court had held that an error in a proposal’s contract line item numbers
(“CLINs”) that increased the offeror’s bid price was properly corrected through clarification.
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DynCorp Int’l LLC v. United States, 76 Fed. Cl. 528, 545 (2007). In DynCorp, an offeror
underreported several cost-reimbursable CLINs, which “carried through to the summary page of
[its] price proposal.” Id. at 544. The agency requested a correction of the error, which resulted in
a minor increase of the offeror’s price. Id. at 545. The court explained that “a mathematical
clarification which causes the successful offeror’s price to go up, and thus makes the offer less
attractive to the government, is less likely to be found improper.” Id. It also noted that “[a]ll of
the information needed to correct the CLIN amounts was present in [the offeror’s] proposal.” Id.Accordingly, DynCorp held that “[t]his type of minor mathematical correction, where the
government already has the information it needs in order to make an evaluation of a bidder’s price,
is a clarification, not a discussion.” Id.Similarly, another judge of this court found the correction of typographical errors contained
in proposal spreadsheets to constitute clarifications rather than discussions. WaveLink, Inc. v.
United States, 154 Fed. Cl. 245, 270 (2021). In WaveLink, the Government allowed several
offerors to correct minor errors to their labor rates contained in various spreadsheets in their
proposals. Id. The court found that the incorrect labor rates resulted from typographical errors
that were apparent on their face, since the correct rates were available elsewhere in the proposals.
Id. For example, one offeror “omitted one rate on a spreadsheet tab, but another tab contained the
applicable rate and its supporting documents demonstrated that [the offeror] intended to provide
the exact same direct labor rates on both tabs of their Volume 6 pricing template.” Id. (internal
quotations and alterations omitted). Another offeror “provided one labor rate at $[**] instead of
$[**], which was the correct rate identified in a different spreadsheet tab delineating the same or
similar data.” Id. Other irregularities included a “clear transposition error” and erroneous
rounding. Id. WaveLink held that because each of these communications “merely amounted to
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correcting mistakes that were either clearly clerical or relatively minor errors or where the
information was readily present elsewhere in the proposal,” they constituted clarifications that did
not rise to the level of discussions. Id.
2. The Discrepancy in Aspire’s Labor Hours Was a Minor Clerical Error.
DeCA determined that the error in Aspire’s spreadsheets “was not a minor clerical error
pursuant to FAR 15.306.” AR 1113. The administrative record is devoid of any explanation of
the agency’s underlying rationale, and more importantly, the evidence in the administrative record
does not rationally support such conclusion. Rather, it is apparent from the record that the
discrepancy in Aspire’s labor hours was a minor clerical error that could be corrected through
clarification. DeCA’s decision to disqualify Aspire was thus arbitrary and capricious in that
regard.
First, from the face of Aspire’s proposal alone, it should have been evident to DeCA that
the discrepancy was likely typographical rather than deliberate. The mismatched labor hour
numbers—2,336 and 2,366—are off by one digit and appear so similar that the error is easily
overlooked by the naked eye, a strong indicator that Aspire had made a typographical error.
Moreover, the typographical nature of Aspire’s error can be confirmed with virtual
certainty by reviewing the formulas in the native versions of Aspire’s spreadsheets, which it
submitted to DeCA with its proposal via the PIEE system. Cell D34 in Aspire’s Direct and Indirect
Labor Summary spreadsheet calculated the RSHA Direct Labor Subtotal by adding together all
RSHA labor subcategories for a total of 2,366 hours. AR Tab 4.b.1. Aspire manually entered the
numbers of hours for the first five subcategories, the sum of which totaled 2,285 hours. AR Tab
4.b.1. In the final subcategory—RSHA Coverage for Contract Work Schedule (cell D32)—Aspire
used the formula “=2366-2285”, which produced the number 81. AR Tab 4.b.1. By using such
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formula, Aspire guaranteed that the RSHA Direct Labor Subtotal in cell D34 would equal 2,366
hours, confirming 2,366 was the intended number.
Comparing this spreadsheet to the Cost Breakout spreadsheet makes clear that Aspire made
a typo by inputting 51 instead of 81 in the Material Handling Laborer formula in the latter
spreadsheet. Each of the first four numbers in the Material Handling Laborer formula (“=[. . .]+ [.
. .]+ [. . .]+ [. . .]+51-[. . .]”) correspond to RSHA labor subcategories in Aspire’s Direct and
Indirect Labor Summary spreadsheet in the same order they appear in that spreadsheet—transport
merchandise ([. . .]), segregate merchandise ([. . .]), store merchandise ([. . .]), and pull merchandise
([. . .]). Compare AR Tab 4.a.1., with AR Tab 4.b.1. However, instead of inputting 81 hours as
the fifth number in the formula, which correlates to the RSHA Coverage for Contractor Work
Schedule subcategory, Aspire typed 51. AR Tab 4.b.1. This resulted in the 30-hour discrepancy
in RSHA direct labor hours between the spreadsheets; had Aspire typed 81 instead of 51, the hours
would have matched.
This sort of obvious typographical mistake is analogous to the types of mathematical errors
in proposals that the Federal Circuit and this court have found to constitute minor or clerical errors
rather than material ones. See Galen, 369 F.3d at 1333; DynCorp, 76 Fed. Cl. at 545; WaveLink,
154 Fed. Cl. at 270. Just as in WaveLink, Aspire made an obvious typo when inputting labor hours
into its spreadsheets, and the correct information was “readily present elsewhere in the proposal.”
WaveLink, 154 Fed. Cl. at 270; see DynCorp, 76 Fed. Cl. at 545 (citing IPlus, Inc., B298020, B-
598020.2, 2006 CPD ¶ 90 (holding that clarification is permissible “where the existence of the
mistake and the amount intended by the offeror is clear from the face of the proposal”)). That
Aspire’s error was obviously typographical supports the conclusion that the error was minor and
clerical and thus subject to clarification.
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Second, the effect of Aspire’s error on its proposed hours and price is minor, to say the
least, and largely inconsequential to DeCA’s evaluation. The typo led Aspire to underreport its
RSHA labors hours in its Cost Breakout spreadsheet by a mere 30 hours. The Government argues
that DeCA intends to use proposed labor hours to evaluate proposals under the Performance
Capability and Price factors. ECF No. 25 at 15 (citing AR 90, 92). While the number of labor
hours an offeror proposes will assist DeCA in determining whether the offeror understands the
solicitation requirements and is able to fulfill them, it is difficult to see how an error totaling 30
hours—a 1.3 percent difference—could affect the agency’s evaluation in a material way.
The same can be said for the price evaluation. It is true that correcting Aspire’s error would
also alter its total proposed price because labor hours drive costs. But according to Aspire, with
the correct figure for labor hours in its Cost Breakout spreadsheet, its price would increase by only
$[. . .] over five years—a mere 0.063 percent increase in total price. ECF No. 21-1 at 29. As
Galen and DynCorp instruct, the correction of cost and/or price figures that lead to a modest
increase in price may properly be addressed through clarification. Galen, 369 F.3d at 1333(correction of mathematical error that increased bid price was permissible clarification); see
DynCorp, 76 Fed. Cl. at 545 (same). Indeed, the impact that clarification would have on DeCA’s
evaluation vis-à-vis other offerors is nil because an increase of Aspire’s price will place it at a
competitive disadvantage, further underscoring the minor nature of its error. DynCorp, 76 Fed.
Cl. at 545. Accordingly, that Aspire’s error had an insignificant effect on its total proposed labor
hours and price supports the conclusion that the error was minor and appropriately subject to
clarification.
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3. The Government’s Arguments to the Contrary are Unpersuasive.
Although its rejection letter did not set forth DeCA’s rationale, the Government posits two
arguments in support of the agency’s determination that the mismatched labor hours in Aspire’s
spreadsheets was not a minor clerical error that could be addressed through clarification. Neither
contention is persuasive.
a. Aspire Did not Violate a Material Provision of the Solicitation.
The Government emphasizes that DeCA advised offerors three times in the solicitation that
the labor hour numbers (and all other information) submitted in the different volumes of their
proposals must match. ECF No. 25 at 14 (citing AR 86 (“Ensure information and statements on
similar topics (e.g., number of work hours and productivity rates) are consistent throughout the
proposal.”); AR 87 (“enter all of the data requested, ensuring your data entries agree with the
information provided in other parts of your proposal and computations are correct.”); AR 242
(“The numbers shown in [the Direct and Indirect Labor Summary] should match exactly the direct
productive hours shown on your cost worksheets.”)). The Government contends that this was a
material provision of the solicitation and that by failing to comply with its requirements Aspire
committed a material error not amenable to clarification. Id. Indeed, the Government argues that
because Aspire failed to comply with the solicitation DeCA was required to reject its proposal.
Id. at 13–14 (citing Allied Tech. Grp. v. United States, 649 F.3d 1320, 1329 (Fed. Cir. 2011)).
As an initial matter, the solicitation contained no such requirement. Instead, it warned
offerors that DeCA “may . . . reject[] without further evaluation” “[p]roposals that fail to comply
with content or format requirements.” AR 85 (emphasis added). Moreover, that Aspire’s error
led to noncompliance with the solicitation’s submission instructions does not per se preclude the
Government from allowing Aspire to correct its error through clarification. Several courts have
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found that content and format errors can be addressed by clarification even where the error resulted
in noncompliance. See, e.g., Level 3 Commc’ns, LLC v. United States, 129 Fed. Cl. 487, 505
(2016) (holding agency abused its discretion by failing to allow offeror to submit map in file format
required by solicitation through clarification); Griffy’s Landscape Maint. LLC v. United States, 46
Fed. Cl. 257, 261 (2000) (holding agency abused its discretion by failing to allow offeror to provide
insurance information as required by solicitation through clarification).
As the Government correctly observes, other courts have held that if an offeror violates a
solicitation provision that serves a substantive purpose, then the violation may constitute a material
error rather than a minor or clerical error. See, e.g., ManTech Advanced Sys. Int’l, Inc. v. United
States, 141 Fed. Cl. 493, 508 (2019). A solicitation requirement may be found to further a
substantive purpose “when it is important to the government’s evaluation, is binding on the offeror,
or has more than a negligible impact on the price, quantity, or quality of the bid.” Id. Here,
however, the Government has failed to meaningfully explain a substantive purpose for its content
and format instructions that would render clarification improper in this case. It primarily contends
that by repeating the relevant instruction three times it is undisputedly a “material requirement” of
the solicitation. ECF No. 25 at 14. But repetition alone does not make a solicitation provision
material. See Bus. Integra, Inc. v. United States, 116 Fed. Cl. 328, 336 (2014) (recognizing “the
inability of an agency to declare an immaterial term to be a material one”). And that the solicitation
permitted DeCA in its discretion to reject or accept a noncompliant proposal further undermines
the argument that the instructions at issue are substantively material. See AR 85.
Instead, the Court must look to the substantive nature or character of the solicitation
provision. The Government argues that the requirement of matching labor hours serves a
substantive purpose and is important to the evaluation because DeCA will use offerors’ proposed
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labor hours to evaluate the Price and Performance Capability factors. ECF No. 25 at 14–15. Of
course, the number and breakdown of an offeror’s proposed labor hours will have a substantive
impact on DeCA’s evaluation. But the requirement that labor hours in different parts of a proposal
exactly match does not further the substantive purpose of ensuring offerors propose sufficient labor
hours if the reason for the discrepancy is purely and obviously clerical. To hold otherwise would
elevate a provision that in essence encouraged offerors to submit consistent and accurate proposals,
something that should be implicit in every procurement, to a material term that would prevent the
agency and offerors from resolving the very type of minor or clerical error that clarifications were
meant to address. The Federal Circuit has counseled against such a “cramped conception of
‘clarification,’” even in circumstances where clarification is necessary for further evaluation of the
proposal. Info. Tech., 316 F.3d at 1323 (“There is no requirement in the [FAR] that a clarification
not be essential for evaluation of the proposal.”). Furthermore, as explained above, Aspire’s error
had such a minor effect on the price and quality of its bid that the impact on the agency’s
substantive evaluation here is negligible.
b. That Aspire’s Error Affected Its Price Does Not Prevent Clarification.
The Government next argues that Aspire’s error was material because it affected Aspire’s
price and would require a revision of the price proposal. ECF No. 25 at 17. As explained, that an
error affected an offeror’s price does not necessarily preclude it from being a minor or clerical
error, and errors that slightly raised an offeror’s price have been found to be errors that can be
resolved by clarification. Galen, 369 F.3d at 1333; see DynCorp, 76 Fed. Cl. at 545. In such
cases, the change was considered a correction, not a revision of the proposal that would require
the agency to hold discussions. See id.20
Nevertheless, the Government relies on two cases from this court to support its materiality
argument. ECF No. 25 at 18–19. Both cases are distinguishable. The Government first cites ST
Net, Inc. v. United States, 112 Fed. Cl. 99, 109 (2013). In ST Net, the plaintiff completely failed
to enter the price and brand/model information for two line items in its proposal, which the court
concluded was a material error that could not be corrected through clarification. Id. at 109–10.
Unlike Aspire’s error, ST Net involved an omission of material information that resulted in a
“fundamentally flawed” proposal. Id. at 111. As the Federal Circuit held in Dell Federal Systems,
clarifications are inappropriate to “cure proposal deficiencies or material omissions.” 906 F.3d at
998. Conversely, Aspire’s mismatched labor hours resulted from a typo that created “an obvious
mathematical error,” and the correct labor hour figure was apparent in Aspire’s proposal despite
the error. Galen, 369 F.3d at 1333. Furthermore, the omission in ST Net led to a seven percent
price increase, a much more significant variance that the 0.063 percent price difference resulting
from Aspire’s error. ST Net, 112 Fed. Cl. at 110.
The Government also relies on Mission1st Group, Inc. v. United States, 144 Fed. Cl. 200,
217 (2019). In that case, the plaintiff’s expense rates in its proposal did not match its supporting
documentation, which was a requirement of the solicitation. Id. at 216. The court held that because
“the [contracting officer] had no way of knowing from the face of Mission1st’s proposal whether
it was the cost narrative or the formulas used in the cost proposal that were incorrect[,] [t]he errors
were . . . substantive, not clerical, in nature.” Id. at 217. Unlike Mission1st, however, DeCA
could have readily determined through Aspire’s proposal the correct labor hours it intended to
propose, as well as the typographical error that caused the 30-hour difference. See supra § III.A.2.
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* * *
In sum, DeCA’s determination that Aspire’s error was not a minor clerical error lacks a
rational basis. The administrative record shows that Aspire’s error was both obvious and
typographical, and it had an insignificant effect on the labor hours proposed in the Cost Breakdown
worksheet and, as a result, Aspire’s proposed price. Accordingly, DeCA could have allowed
Aspire to resolve the error through clarification.
B. DeCA Abused Its Discretion by Failing to Allow Aspire to Correct Its Error Through
Clarification.
Whether a clarification was permissible does not end the inquiry, however, because the
decision to engage in clarifications with an offeror in a procurement under FAR Part 15 lies within
the discretion of the procuring agency. FAR 15.306(a)(2) (“offerors may be given the opportunity
to clarify certain aspects of proposals” (emphasis added)). “Nonetheless, the permissive language
of the clarification provisions in Part 15 does not mean that those provisions are not susceptible to
judicial enforcement.” BCPeabody Constr. Servs., Inc. v. United States, 112 Fed. Cl. 502, 510
(2013). Although the parties each cite cases supporting their respective positions on whether
DeCA reasonably exercised its discretion, there appears to be no bright line rule or legal test
applicable to the Court’s review of this issue. Courts that have reviewed claims involving an
agency’s failure to seek clarification employ a highly fact-intensive and case-specific analysis.
Nevertheless, several common factors have led courts to conclude that an agency’s decision to
forgo clarification was an abuse of discretion.
For example, an agency is more likely to abuse its discretion by not seeking clarification
when a proposal contains an error that is especially minor and can be easily corrected. See Level
3 Commc’ns, 129 Fed. Cl. at 504 (“[T]he omission of the .kmz file in this case was an oversight
that easily could have been corrected. It was not a major omission that made it impossible to fully
22
evaluate Level 3’s proposal.”); Griffy’s Landscape Maint., 45 Fed. Cl. at 258–59 (“a brief phone
call would have remedied the error”). The obviousness of an error from the face of a proposal also
weighs in favor of finding the agency unreasonably failed to seek clarification. See Criterion Sys.,
Inc. v. United States, 140 Fed. Cl. 29, 37 (2018) (“[T]he obviousness of the error is an important
aspect of determining whether the CO acted reasonably by not seeking clarification.”); Griffy’s
Landscape Maint., 45 Fed. Cl. at 259 (explaining that one of the goals of clarification is to ensure
the Government “does not take advantage of obvious contractor errors”). The competitiveness of
an offeror’s price likewise strengthens the case for clarification. See BCPeabody Constr. Servs.,
112 Fed. Cl. at 512 (“Given BCPeabody’s significantly lower bid, the contracting officer had
virtually overwhelming cause to contact BCPeabody about the clerical error . . . .”); Level 3
Commc’ns, 129 Fed. Cl. at 505 (“In this case, as in BCPeabody, the CO had ‘virtually
overwhelming cause’ to seek clarification from Level 3, because of its ‘significantly lower’
price.”). And the existence of information elsewhere in a proposal that could correct or clarify an
error further supports a finding that the agency abused its discretion by not seeking clarification.
See BCPeabody Constr. Servs., 112 Fed. Cl. at 512 (“The contracting officer had all of the
information she needed about BCPeabody’s proposal, including all price information . . . .”).
All of these factors are present here. As explained above, Aspire’s error was minor and
had a demonstrably insignificant effect on the evaluation. It also was a simple typographical
mistake, as opposed to a deliberate decision, that was obvious from the face of the proposal.
Indeed, Aspire could remedy the error by adjusting the labor hours in its Cost Breakdown
spreadsheet by just one digit, with a concomitant minor adjustment to its price proposal. Likewise,
despite its error, all the information needed to determine the correct labor figure was contained in
Aspire’s Direct and Indirect Labor Summary spreadsheet. A clarification would thus serve merely
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to confirm Aspire’s evident intent. Moreover, Aspire had a highly competitive price, being the
second lowest price of all offerors and not much higher than the lowest priced proposal submitted
by [. . .]. Compare AR 488 ([. . .]’s price at $[. . .]), with AR 394 (Aspire’s price at $[. . .]). Each
of these facts supports the conclusion that DeCA abused its discretion by failing to seek
clarification from Aspire.
Relying on the same group of cases (e.g., ST Net and Mission1st), the Government contends
that DeCA did not abuse its discretion because it properly concluded that Aspire’s error was
material, would affect Aspire’s price proposal, and thus could be resolved only through
discussions. ECF No. 25 at 17–19. But as explained above, the Government’s arguments are not
persuasive and the cases it cites are distinguishable. See supra § III.A.3. Aspire’s error was not
material and should properly have been resolved through clarification.
Accordingly, the Court concludes that DeCA abused its discretion by failing to allow
Aspire to clarify what was an obviously minor clerical error that could easily be corrected, where
the information needed to understand and correct the error was contained in Aspire’s proposal and
where Aspire submitted a highly competitive price. In so holding, the Court acknowledges the
broad discretion of agencies in conducting procurements in general, and specifically in requesting
clarification in Part 15 procurements. See Impresa, 238 F.3d at 1332–33; FAR 15.306(a)(2). But
where the correction of an error fits comfortably within the definition of a clarification, the FAR
expresses a strong policy preference in favor of clarification. See Info. Tech., 316 F.3d at 1321–
22. The 1997 amendments resulting in FAR 13.506 were enacted “to provide for empowerment
and flexibility[,] . . . end unnecessary regulatory requirements[,] . . . and shift to a new emphasis
on choosing ‘best value’ products.” Contracting by Negotiation and Competitive Range
Determination, 62 Fed. Reg. at 51,225; see also Info. Tech., 316 F.3d at 1321. The rule is meant
24
to “help offerors . . . by permitting easy clarification of limited aspects of their proposals.” Info.
Tech., 316 F.3d at 1321 (quoting Contracting by Negotiation and Competitive Range
Determination, 62 Fed. Reg. at 51,228–29). DeCA’s disqualification decision runs contrary to
these goals by rigidly rejecting a competitively priced proposal for an evident typographical
mistake without providing any opportunity for Aspire to explain and resolve its error. In the
particular circumstances of this case and in light of the relevant regulations and their stated goals,
such a decision can only be described as an abuse of discretion.
C. An Injunction is Appropriate to Remedy DeCA’s Error.
Although Aspire principally argues that the Court should remand this matter to DeCA to
allow Aspire to clarify its error, such relief would be injunctive in nature as it would set aside
DeCA’s disqualification of Aspire and direct the agency to take certain actions. PGBA, LLC v.
United States, 389 F.3d 1219, 1228 n.6 (Fed. Cir. 2004) (“[A]n injunction either mandates or
prohibits particular conduct.” (citing Perez v. Ledesma, 401 U.S. 82, 124 (1971)). At oral
argument, the Government conceded that, if it were to lose on the merits, an injunction would be
appropriate. It likewise clarified that it does not contest the other injunction factors aside from
success on the merits. In response, Aspire agreed at oral argument that an injunction would be
appropriate should the Court rule in its favor on the merits. See ECF No. 21-1 at 36 (arguing in
the alternative that Aspire meets the injunctive relief standard).
A party seeking permanent injunctive relief must show that: (1) it “has succeeded on the
merits of the case;” (2) it “will suffer irreparable harm if the court withholds injunctive relief;” (3)
“the balance of hardships to the respective parties favors the grant of injunctive relief;” and (4) “it
is in the public interest to grant injunctive relief.” PGBA, 389 F.3d at 1228–29. For the reasons
explained above, Aspire has demonstrated success on the merits. Aspire will also suffer
25
irreparable harm without an injunction because it has been eliminated from consideration for
award. Wackenhut Servs., Inc. v. United States, 85 Fed. Cl. 273, 311 (2008) (“a protester suffers
irreparable injury, when it has been deprived the opportunity to compete fairly for a contract”).
The balance of harm favors Aspire, since the detriment to Aspire’s ability to compete in the
absence of an injunction outweighs the effect that injunctive relief will have DeCA’s on-going
evaluation. See G4S Secure Integration LLC v. United States, 161 Fed. Cl. 387, 419 (2022)
(balance of harms favored plaintiff where government was obligated to conduct proper
procurement and lack of injunction would be “detrimental to Plaintiffs’ ability to meaningfully
compete for the contract”). Correlatively, the public interest is served through an injunction by
upholding the integrity of the procurement process and increasing competition. See KWV, Inc. v.
United States, 111 Fed. Cl. 119, 128 (2013) (“the public has a strong interest in a fair and
competitive procurement process”).
Accordingly, each of the factors favors injunctive relief to remedy the Government’s
arbitrary and capricious rejection of Aspire’s proposal.
IV. CONCLUSION
For the reasons set forth above, the Court GRANTS Aspire’s Motion for Judgment on the
Administrative Record (ECF No. 21) and DENIES the Government’s Cross-Motion for Judgment
on the Administrative record (ECF No. 25). The Court hereby sets aside DeCA’s decision to reject
Aspire’s proposal without further evaluation. DeCA shall restore Aspire to the competition, allow
Aspire to resolve the labor hour discrepancy in its proposal through clarification pursuant to FAR
15.306, and evaluate Aspire’s corrected proposal consistent with this opinion. The Clerk is
directed to enter judgment accordingly.
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This opinion and order will be unsealed in its entirety after June 9, 2023, unless the parties
submit by no later than June 6, 2023, an objection specifically identifying the protected
information subject to redaction. Any objecting party must submit a proposed redacted version of
the decision and provide the reason(s) supporting the party’s request for redaction.
SO ORDERED.
Dated: May 30, 2023 /s/ Kathryn C. Davis
KATHRYN C. DAVIS
Judge
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