THIS OPINION WAS INITIALLY ISSUED UNDER PROTECTIVE ORDER AND IS BEING RELEASED TO THE PUBLIC IN REDACTED FORM ON SEPTEMBER 26, 1995. DENIED: September 14, 1995 GSBCA 13340-P SYSOREX INFORMATION SYSTEMS, INC., Protester, v. DEPARTMENT OF THE TREASURY, Respondent, and CONCEPT AUTOMATION, INC., Intervenor. E. Sanderson Hoe, Patrick K. O'Keefe, C. Stanley Dees, and John A. Bonello of McKenna and Cuneo, Washington, DC, counsel for Protester. Donald M. Suica, Greg M. Weinman, Holly L. Hagen, Duane L. Zezula, and Dana M. Vader, Office of Chief Counsel, Internal Revenue Service, Department of the Treasury, Washington, DC, counsel for Respondent. Richard J. Conway, William M. Rosen, Leticia E. Flores, Kendrick C. Fong, and Robert J. Moss of Dickstein, Shapiro, and Morin, Washington, DC, counsel for Intervenor. Before Board Judges DEVINE, HYATT, and DeGRAFF. DEVINE, Board Judge. Protester seeks to show that the Government improperly awarded a computer contract to an awardee whose offer did not meet the terms of the request for proposals (RFP). The Government, in turn, seeks to show that protester does not occupy the status of an interested party because its own offer was not compliant with the RFP. Findings of Fact The United States Treasury Department (Treasury), in the procurement at issue, sought an indefinite quantity, indefinite delivery contract to supply its requirements during the period of a year (renewable for a second year) for certain automatic data processing equipment. The procurement was referred to as Treasury Department Acquisition 2, or TDA-2. Protest File, Exhibit 6. The equipment sought included low, medium, and high end processors, together with notebook computers, file servers, networking products, software, peripherals, documentation and warranty support. In addition, it included upgrades for disk drives, monitors, memory, central processing units and software. Protest File, Exhibit 3. All information processing equipment was to be standard, off-the-shelf commercial hardware and software products. Id. The Government estimate of the value of the contract was approximately $100 million for the first year and $92 million for the second. Protest File, Exhibit 1. Since this procurement sought only commercial products, award would be made to the responsible, technically qualified offeror with the lowest price. Protest File, Exhibit 8. Eight firms submitted offers and four were found to be in the competitive range. The chosen four all submitted best and final offers (BAFOs) at the close of discussions. The lowest acceptable offer was submitted by Concept Automation, Inc. (CAI), which was awarded the contract on July 3, 1995. The second lowest offer was protester's. The price difference between the two was approximately $17 million in favor of the awardee. Technical Proposal Validation Procedures Each offeror's proposal was evaluated by a Technical Evaluation Panel (TEP) for compliance with five sections (C, D, E, F, and J) of the request for proposals. Protest File, Exhibit 37. The solicitation contained sixty-seven pages of technical matrices which were to be filled in by each offeror. Protest File, Exhibit 37 at 791-858. These were somewhat like check lists. They were keyed exactly to the solicitation's equipment requirements, especially Section C. Id. at 632. The matrices sometimes required yes or no answers as to certain equipment capabilities and sometimes required that the equipment offered be named by manufacturer and model number with an indication of whether or not the manufacturer's technical literature was available. Id. at 801-02. The TEP conducted its evaluations by making sure that the offeror was giving the proper answers in each case and by comparing the technical characteristics of each offeror's products as they appeared in the technical literature to the RFP requirements set out in the matrices, to determine whether or not the equipment was compliant. In those cases where the technical literature was incomplete or insufficient to support a judgment the TEP sought additional information from the equipment manufacturers, via the offerors, to clear up doubtful areas. Protest File, Exhibit 11. While the TEP compared the literature to the RFP, another panel, known only by its acronym BMEC, made internal cross checks of each proposal. The proposals were submitted in three separate volumes, one each for the Business Proposal (Volume I), the Price Proposal (Volume II), and the Technical Proposal (Volume III). A fourth volume contained the Technical Literature. It was the responsibility of the BMEC to see that there was a correlation among the various matrices of the various proposal volumes. Protest File, Exhibit 11. Thus the matrices showing the hardware and software components and peripherals, for example, were examined to be sure that the equipment shown in the Technical Proposal also appeared on the pricing spreadsheets of the Price Proposal and vice versa. Id. Neither panel assigned scores to any of the proposals. Despite the presence of the word "evaluation" in both of their titles, their job was merely to determine that the equipment required by the RFP appeared consistently in the various parts of the various offers, that all characteristics of all the offers were supported by the accompanying technical literature, and that the various matrices were correctly and completely filled out. Neither panel evaluated technical performance. Protest File, Exhibit 11. Both panels looked at paperwork and not hardware. Id. Both panels found both the protester, Sysorex, and the awardee, CAI, compliant in all respects. Protest File, Exhibit 44. The Protest Grounds Sysorex filed eight grounds of protest, of which three (the third, fourth, and seventh counts) were withdrawn prior to hearing. Of the remaining grounds, the first disputed the capability of the equipment that CAI offered to accept an upgrade of its random access memory (RAM) to a maximum of 64 megabytes (MBs), in 16 MB increments. The second challenged the capability of CAI's notebook computer to allow a change of batteries without loss of data and without re-booting, while the unit remained under power. This is referred to as "hot swapping." The third ground of protest questioned whether the laser printer that CAI offered could handle both legal and letter size copies. The fourth ground of protest asserted that the A/C adapter of CAI's proposed portable printer could not "trickle charge" the battery. The fifth ground asserted that the Treasury had failed to treat protester fairly because it had accepted CAI's non-compliant proposal, and in doing so had changed the RFP's requirements in CAI's favor without extending the same courtesy to protester. This ground refers to the fact that, in its answer (and in an earlier dispositive motion), Treasury attacked protester's status as an interested party, alleging that its proposal could not qualify for award because the processors it offered were not certified as being compliant with the emission standards of the Federal Communications Commission (FCC), as the RFP required, and that protester's supplier of certain central processing units (CPUs) could not produce the units in large enough quantities and quickly enough to meet the maximum numbers that could be ordered under the proposed contract. This ground is thus based on the theory that Treasury must have changed its requirements in order to accept CAI's non-compliant proposal but would not change its requirements to accept protester's allegedly non-compliant proposal, thus treating protester unfairly. We examine each of these grounds in the order set out. The RAM Upgrade Issue The RFP required that offerors provide 16 megabytes (MB) of random access memory (RAM) with each base level CPU (CLIN 0003), together with the capability to increase the RAM in increments of 16MB (CLIN 0023) to a total of 64MB. Protest File, Exhibit 37 at 650; see also id. at 649 (CLINs 0001 and 0021). The acronym CLIN translates to Contract Line Item Number. CAI answered the matrix questions with respect to the RAM upgrade CLIN as follows: Question: When a quantity of "1" of this CLIN is ordered, how many Megabytes of RAM will be delivered? Answer: 16 MB. Question: What is the Megabyte size for each chip or SIMM delivered as a part of this CLIN? Answer: 8MB. Question: Does the offered chip size/SIMM (single in- line memory module) size allow full population of the motherboard (64MB)? Answer: Yes. Protest File, Exhibit 23 at 303. Memory modules or memory boards fit into slots (or sockets) on the CPU motherboard. Transcript, Vol. 1 at 174. There is evidence that CAI originally believed it was offering an motherboard. Id. at 197-98. The evaluators did not know how many slots there were in CAI's motherboard, nor care whether there were holding or holding , so long as the 64MB capacity was furnished. Id. at 177, 182. As it turned out, CAI offered a motherboard. Id. at 169. When queried on this point CAI responded that it had always intended to meet the 64 MB upgrade requirement, and explained that the memory boards it intended to offer were actually , giving the necessary total of 64MB. Id. at 248-49. Protester contends that the part number, , that appeared in protester's offer describes . Protest File, Exhibit 1014 at 3. CAI's project manager, Dr. Chester, testified that: "The nomenclature means " Vol. 2 at 7. In its price proposal CAI described its RAM uprades as " ." Protest File, Exhibit 1014 at 3. In response to the question: "Concept described what they were proposing as ; isn't that right?"--Dr. Chester replied: It looks like we are proposing which might lead someone to conclude that we are talking about and, unfortunately, our language could have been more precise. But that is referring to really . And so the language isn't really as clear as it could be, but that's what we--was meant. Transcript Vol. 1 at 272. Battery "Hot Swapping" The RFP required that the advanced level notebook computer (CLIN 0113) be equipped with "2 battery packs, - - -, capable of being trickle-charged, with hot swapping capability ("hot- swapping" is the ability to change battery packs while in a power-on status, without the A/C adapter connected, and without loss of data)." Protest File, Exhibit 37 at 646-47. The definition in parentheses was not in the original solicitation. It was added by amendment after other offerors asked questions concerning what "hot swapping" actually meant. Transcript, Vol. 1 at 205. Some notebook computers, such as the Commax offered by protester, can be fitted with two main batteries by removing the floppy disc drive and adding a battery adapter. Id. at 235-36. Removing either battery while the other is in place does not affect any function of the computer. In general the advantage of the hot-swapping feature is that when a battery dies, it can be replaced without any loss of the data which the operator is currently working on, and without having to re-boot any operating systems. Id. at 206. Notebook computers are designed to be completely portable, capable of operation without an external power source. Battery life, however, is necessarily short. The instant RFP required a minimum life of only two hours. Protest File, Exhibit 23 at 305. CAI offered the , a notebook computer which is designed to operate on three batteries: a main battery, a backup battery which powers what calls the "resume" function and which receives its initial charge from the main battery, and a small internal battery which powers the clock that keeps the date and time. Protest File, Exhibit 24 at 323; Exhibit 1001 at 2-5; Transcript, Vol. 1 at 55. describes the resume state as follows: In the suspend [resume] state, power is supplied to the computer's memory so that it can retain its contents - the user's programs and data. We also continue to supply some power to the power supply microcontroller, the video controller and the PCMCIA controller so that they can maintain their state during suspend. Power hungry components like the CPU, the hard disk drive and the LCD panel are allowed to turn off. Protest File, Exhibit 519 at 1327. In the resume state with the main power switch off the main battery may then be changed without loss of data and without the necessity to re-boot any operating systems when the main power switch is turned back on. In the resume mode any function of the computer which requires operation of the hard drive, such as file copying, cannot be begun or, if already begun, cannot proceed. Transcript, Vol. 1 at 219-23. The purpose of the hot swapping requirement appears in the following answer, given by Treasury's chief evaluator, to the question "Exactly what were you looking for?" His answer: "What we were looking for is the ability . . . for a user to be on a plane, or someplace that they were away from a power outlet, if they were using their notebook on the battery power, if they needed to -- if the battery became low or whatever and they needed to swap it out, that they could do it quickly without really disrupting their work. It was just more of a convenience thing. They wouldn't have to shut the machine down, change the battery, re-boot the system, reload their applications and get back to where they were before. Transcript, Vol. 1 at 206. The Portable Printer, its A/C Adapter, and "Trickle Charge" The RFP specified that the portable, battery-powered printer (CLIN 0081) must have an "A/C adapter capable of trickle-charging battery." Protest File, Exhibit 37 at 661. Protester interprets this phrase as though it contained the additional words: "while the system is operating." It apparently does so because in a similar predecessor procurement the RFP did contain such a phrase. Transcript, Vol. 1 at 16-17, 93-94. There is no language in the present RFP that supports protester's position. The High-Capacity Laser Printer and Legal Sizes According to the RFP: "The High-Capacity Laser Printer will primarily be used for network application and large printing volumes for text and graphics. The High-Capacity Laser Printer shall be capable of printing regular and legal size pages and transparencies." Protest File, Exhibit 37 at 666. The RFP also requires a "minimum 850 sheet capacity." Id. CAI pledged to fulfill the requirements for this printer, but its proposal did not specifically say that it would furnish legal size trays to handle the legal size printed sheets. Id. The RFP did not specifically request legal size trays. Id. It requires only that the printer be able to print legal size sheets. Id. CAI simply says that it agreed to meet the specification and will do so, supplying legal size trays in order to make effective that part of the RFP that requires its printer to be able to print large volumes of both "regular" and legal size sheets. Treasury's Alleged Failure to Deal with the Parties Fairly This ground encompasses all of the earlier grounds. Protester is saying that when Treasury awarded its contract to CAI it could only do so, given the existence of the deficiencies alleged by protester, by modifying its RFP in order to obviate CAI's shortcomings, but it didn't extend the same courtesy to protester with respect to the shortcomings that Treasury alleges existed in protester's proposal. This ground will stand or fall with the other grounds. Treasury's Affirmative Defenses They are similar to the issues raised earlier in Treasury's motion to dismiss, which asserted protester's lack of status as an interested party. There are three. All deal with RFP requirements. The first is that Sysorex is not an interested party because it offered certain processors (CLINs 0003, 0005, and 0007) that had not been certified with respect to electronic emissions by the Federal Communications Commission (FCC). The second asserted that protester's CPU supplier, , could not have produced the maximum number of CPUs (CLINs 0003, 0005, and 0007) that Treasury was permitted to order under the contract, as of the specified date, June 30, 1995. The third asserted that certain of the equipment offered by protester had not been certified as electrically safe by a nationally recognized testing laboratory. Treasury did not produce any evidence on this last issue at hearing, and none appears in the record, nor is the issue dealt with on brief. We conclude that Treasury has abandoned it, but in any event it fails for want of proof. We consider the remaining two grounds below. Protester's Status: FCC Certification The RFP required that all offered computer systems show compliance with the FCC's limits on electronic emissions. In response to this requirement protester furnished a letter from the director of federal sales of , its CPU supplier, which read, in part: , certifies that these system(s): -Are FCC Rule 47 CFR Part 15, Class B certified; CLIN 0003 (FCC ID# ), and CLIN 0005 (FCC ID # ) -is FCC Rule 47 CFR Part 15, Class A compliant, or Class B certified; CLIN 0007 (FCC ID# ) Protest File, Exhibit 26 at 417. proposed to substitute a more advanced chip, , for the chip in the system that had received FCC certification. advised protester by letter, which was sent on to Treasury, that the chip change would not require any re-testing for FCC certification. Protest File, Exhibit 507 at 761. This advice was in line with FCC policy on chip changes. Transcript, Vol. 2 at 47, 48. In addition to the chip change, which protester was aware of, there were also changes to the motherboard of the FCC-approved system, which were not known to protester. Id. at 52-54. emissions expert did not believe re-submission to the FCC was necessary, because the FCC rules required such submissions on already approved systems only when the changes caused a degradation in the system's emissions performance vis-a-vis the FCC's emissions limits. Id. at 36. expert, Mr. Wei Li, noted that the emissions he recorded on the changed system were, in every instance, farther away from the FCC's limits than the emissions from the approved system and concluded that there was no degradation in emissions levels in spite of the chip change and the changes to the motherboard. Id. at 67-68. After this protest was filed, emissions data on the new system were filed with the FCC. The Government's expert in this area, Mr. Cobbs, an FCC employee, testified that there were two classes of permissive changes that could be made with respect to an already approved system. The first, Class I, was a change that did not degrade the emissions status of the system. Transcript, Vol. 2 at 63. This determination is made by the manufacturer. The FCC would not even know of the change because it did not have to be reported. Id. at 36. The second, Class II, is a change that degrades the emissions status of the system. If there was degradation, a matter determined in the first instance by the manufacturer, then emissions data had to be sent to the FCC, before the changed system was sold. Id. These submissions did not amount to a re-certification request. Only an intentional change in the frequency-determining element required a new certification under a new number. Id. at 36-37. It was Mr. Cobbs's opinion that the higher frequencies emitted by the new computer system, even though farther away from the FCC limits than the original, were evidence of degradation. Id. at 44. Mr. Cobbs also testified, with respect to what data were to be submitted: "The [FCC] rule requirement is not clear, even the test measurement procedure is not clear as to how many to report, but anything over [closer to] 20 Db to the limit is suspect." Id. at 60. At various times the FCC required: the 10 highest frequencies, all those frequencies within 20 Db of the limits, and (currently) an unspecified number. Id. at 60-61. Although Mr. Cobbs testified that should have submitted emissions data earlier, he also testified that if had done so the FCC would have approved the new system, but not under the old number. Id. at 83. Treasury's technical evaluation panel accepted both certification and statements as it had accepted other manufacturer's certifications on other items of equipment, and found protester compliant with the RFP on this issue. Protest File, Exhibit 29 at 445. Protester's Status: Its Ability To Deliver Treasury's evaluators were concerned about protester's ability to deliver its promised computer systems within the time allowed by the RFP and in the quantities allowed by the maximum order limitation. The RFP specified an availability date of June 30, 1995, a delivery date thirty days after receipt of a delivery order, and a maximum permissible order of 3,860 units. The limiting factor was the availability of processor (chip), which was newly developed. intended to install this chip in the computer systems that it was to supply to protester. Protest File, Exhibit 1017. When queried on the chip's availability, protester produced a letter from dated February 14, 1995, which contained the statement that "Samples of the micro-processor will be available in early April. The should begin production in May or June so it will definitely be commercially available by July. The official announcement date will be in June." Protest File, Exhibit 502 at 360. Protester also passed on to Treasury a later letter dated May 23, 1995, that stated: "General samples of the 100 MHz processor will be shipped to . . . , beginning on May 24, 1995." Id., Exhibit 60 at 1090. Protester's project manager testified that she understood that the processor would be in full production and available for shipment by June 30, 1995. Transcript, Vol. 2 at 194. advised protester that its monthly production rate for the processor was 100,000 units. Protest File, Exhibit 1013 at 81. On May 25, l995, chief financial officer wrote to protester's project manager as follows: intends to acquire 100 MHz processors directly from in support of orders issued under the TDA-2 contract. shipped a general sample of the 100 MHz processor to on May 24, 1995, which was received today, for integration and testing. Sysorex was assured by that 100 MHz processors will be in full production and available for shipment to in support of TDA-2 on or before June 30, 1995, which is the anticipated date of contract award. anticipates no problem with the 100 MHz configuration proposed by Sysorex for CLIN 0005 performing in full compliance with all solicitation requirements including but not limited to FCC B certification and EPA Energy Star compliance. Protest File, Exhibit 502 at 1. On June 8, 1995, became aware that the chip would not be in full production by June 30, 1995, the projected date of contract award, but did not so advise protester. Protest File, Exhibit 522. Discussion The most vociferously urged of protester's grounds is the charge that CAI could not meet the RFP requirement that its computers be capable of upgrade from 16MB of random access memory to 64MB of RAM, in increments of 16MB. Protester asserts that CAI offered memory boards of , resulted in only of memory. It bolsters this position by pointing to a memory board part number that protester says identifies . The upgrade in question had its own contract line item number. In response to a matrix query as to how much memory would be supplied by CLIN, CAI gave the correct answer of 16MB. CAI explains that it always intended to offer the full upgrade, and that its memory boards are . Protester had the burden of persuasion on this issue, but has not carried it. This ground is denied. The next most vigorously pursued ground concerned the phrase "hot swapping" as applied to portable computers and their batteries. Protester says that hot swapping cannot take place if the main computer battery is turned off. It says that even though CAI's , when in the resume mode, does not lose data during a battery change, and even though it does not thereafter require re-booting, it still does not meet the RFP definition because the main battery is not in a "power-on" status when in the resume mode even though a backup battery is. The quoted term necessarily refers to battery power since the A/C adapter must be disconnected. The computer (offered by protester) swaps batteries while powered by an added second main battery. The swaps batteries while powered by an integral backup battery. It is true that the hard drive cannot be accessed or used during the swap, but we attribute little of consequence to this fact. Battery swapping in either of the two computers takes a matter of seconds. We see little difference in the two systems. Both are fully compliant, literally and functionally, with the RFP requirement. This ground is denied. The remaining two grounds (the third will share their fate) are short horses, soon curried. We hold that CAI's A/C adapter is capable of trickle charging the battery of its battery-powered printer. There is no evidence to the contrary, and no reason to believe that the trickle charging must be done while the system is operating as protester contends, because the RFP simply does not require it even though an earlier RFP in another procurement did. To protester's credit it did not pursue this ground, or the next, with any vigor. This ground is also denied. We hold that the RFP, in so many words, required only that the specified high-capacity laser printer be capable of, among other things, printing legal size sheets. Protester says that CAI didn't mention any legal size trays and is therefore non- compliant. The short answer is that the RFP didn't call for any either, but whether it did or did not, the requirement that the printer be capable of printing legal size sheets presupposes that all of the peripheral equipment necessary to do so will also be provided, and this is what CAI offered. This ground is also denied. In view of the disposition that we make of the foregoing grounds, protester's final ground, that Treasury overlooked CAI's shortcomings but not protester's, must fail because we find that protester has none of the shortcomings that Treasury and CAI have alleged that it has. This brings us to Treasury's two remaining affirmative defenses, which we consider in order to clear the jurisdictional air. Treasury attacks protester's status because its own offered computers were not FCC-certified, and because Treasury doubts protester's ability to deliver what it promised. Treasury admits in its pleadings that its evaluators found protester fully compliant with the RFP in the month of June 1995. In the following month, however, after this protest was filed, Treasury decided that protester was non-compliant on at least two grounds, although nothing had changed in the interim. With respect to the FCC certification, protester's supplier advised protester that its computer systems were certified by the FCC and furnished an FCC certification number. Protester's chip supplier, , advised protester that it had checked with the FCC and that the substitution of the chip for the chip in the originally tested computer system would not affect the certification. Protester passed all this on to Treasury. Treasury accepted it at face value, as had protester. Treasury talks of misrepresentation on brief but has produced no evidence of misrepresentation and we find none. The evidence at hearing was equivocal on the issue of whether or not protester's supplier, , should have sent new emissions data to the FCC because of the changes to the motherboard which might have affected emissions. The answer lies in the meaning of the word "degradation" as applied to electronic emissions. Mr. Cobbs' testimony for Treasury on this point is ambivalent. Mr. Cobbs says that changes in the motherboard (such as the addition of a voltage regulator) that degrade emissions performance with respect to FCC limits, require the submission of emissions data, so that the FCC can assess whether the system is going to interfere with other equipment frequencies. Presumably, if the motherboard change does not degrade emissions performance, there is no reason to send in the emissions data. The FCC emissions limits are known to the trade. Any knowledgeable person, such as expert, Mr. Li, can examine the figures and reach a conclusion as to whether or not the change to the system has caused a degradation in the system's performance with respect to emissions. There is no definition of degradation in the FCC regulations. Mr. Cobbs' view is that any unconsidered frequency (during the original certification) is degradation, or somehow requires a submission, as is any frequency higher than those originally considered. This makes little sense, especially where, as here, the system protester proposed produced emissions that were further away from the FCC's limits than the system originally certified, and Mr. Cobbs himself testified that on the figures he saw he would have approved the system. This does not jibe with his earlier statement that he would not have approved the new system under the old number, which is tantamount to saying that not just emissions approval was required but also re- certification. Nor does it jibe with his statement that only an intentional change in the frequency-producer required a re- certification, because there was no such change here. We conclude that was not required to seek further FCC approval of its already certified system, because its expert saw no emissions degradation, and, in fact, there was none. We hold that Treasury has failed to show that protester's computer systems lacked FCC certification. On these facts there is no reason to find protester ineligible for award, and thus lacking the status of an interested party. Treasury's final challenge to protester's status is based on its assertion that protester might not be able to deliver the goods as promised. There is no evidence that it could not have met the delivery schedules, had protester been awarded the contract. The contract at issue was not let until July 5, l995. The earliest possible delivery date was August 5, 1995, but the Government might well have waited till much later to begin its orders, and might well have ordered far below the maximum order limitation. Under these circumstances any consideration of whether protester might not have been able to deliver if it had gotten the award is speculative. There is no reason to find protester lacking status as an interested party on this ground. The Government had the burden of proof on this defense and has failed to carry it. Decision For the reasons given, the Government's motion to dismiss based on protester's lack of status as an interested party is denied. The protest is denied. The suspension order heretofore entered expires by its terms. DONALD W. DEVINE Board Judge We concur: CATHERINE B. HYATT MARTHA H. DeGRAFF Board Judge Board Judge