When a contractor files a bid protest with the Government Accountability Office (GAO), that protest triggers an automatic stay of the procurement as long as the protest is timely filed in accordance with the Competition in Contracting Act’s (CICA) automatic stay provisions. The automatic stay requires the procuring agency to stop the contract award or, if the contract has already been awarded, to stop contract performance pending the outcome of the protest. Although it is relatively uncommon, the procuring agency may override the automatic stay if it notifies GAO in writing that performance of the contract is in the best interests of the United States or that urgent and compelling circumstances do not permit waiting for GAO’s decision on the protest.
When the stay has been overridden, the contractor may seek to challenge the stay override by filing suit in the Court of Federal Claims (COFC). Contractors, however, may have a difficult time prevailing in such an action especially when the agency can demonstrate that there is an urgent and compelling need for the goods or services. For example, the COFC recently declined to override a CICA stay for COVID testing services in Comprehensive Health Services, LLC v. United States, No. 20-1585C (Nov. 24, 2020).
Comprehensive Health Services, LLC v. United States
In this case, FEMA issued a request for quotations for COVID testing services and gave bidders less than six hours to submit a quote. Due to the short time frame, Comprehensive Health Services (CHS) was unable to submit a quote. CHS filed a protest with GAO arguing the short bid time was restrictive of competition. FEMA initially indicated that it would take corrective action in response to the protest and allow bidders more time to submit a quote.
FEMA later changed course and instead awarded a sole source contract to another contractor. In its Justification and Approval (J&A) supporting the sole source award, FEMA asserted that the sole source award was justified due to the unusual and compelling urgency for the COVID testing services as a result of the pandemic.
CHS then filed another protest with GAO challenging the sole source award. The filing of the protest triggered the automatic stay. FEMA overrode the stay, and CHS filed suit in the COFC arguing that the override was arbitrary and capricious and an abuse of discretion. CHS sought to have the COFC grant it a temporary restraining order and a preliminary injunction prohibiting the override. The COFC, after balancing the parties’ and the public’s interests, denied CHS’s request.
FEMA asserted that there was an urgent and compelling need for the COVID testing services. FEMA stated that any break in testing would hamper its ability to detect positive COVID cases among its workforce, hinder their efforts to mitigate the spread of COVID-19, and jeopardize their ability to operate under safe working conditions. The COFC found that FEMA’s decision to override the stay was not arbitrary and capricious. The COFC noted that any harm to CHS by not being able to compete for and perform the contract was outweighed by the harm to the Government of not acquiring the services.