(Editor’s Note.  The following case addresses when it is legitimate for the government to override the requirement to impose an automatic stay on the award of a contract when there is a timely protest issued.)

The National Highway Traffic Safety Administration awarded an information technology services contract to Centech where upon e-Management filed a timely protest with the GAO. Nonetheless the government waived the automatic stay required under the Competition in Contracting Act (CICA). The court addressed whether the decision to override the stay was legitimate in the light of four factors discussed in an earlier Motor Vehicle Mfrs case – (1) adverse consequences resulting from the stay (2) reasonable alternatives to the override existed (3) did the agency consider the potential cost of proceeding with the override and (4) the override’s impact on competition and integrity of the procurement system. The court ruled the override of the automatic stay was improperly decided upon. The court rejected the agency’s assertion it would not be able to maintain its IT system stating there was no such evidence presented.  For the second factor, the court concluded there was no evidence of a serious exploration of options and there was in fact other reasonable alternatives the agency chose not to pursue. As for the third factor, the court said the agency’s cost benefit analysis was flawed where it improperly identified the costs of sustaining the protest as “reprocurement costs” and its assertion that the override would avoid “termination” and “interruption costs” were not proper elements to be considered “benefits.”  Finally for the fourth factor, the court claimed the agency’s assertion it had a reasonable chance to prevail in the protest did not relate to the automatic stay or integrity of the procurement system (E-Management Consultants v US, Fed. Cl. No 08-680).

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