The First Offer Should Be Unreasonable – and Other Oddities of Government Contracting

by Dennis Crouch 

The Federal Circuit’s new decision in DynCorp v. US (Fed. Cir. 2021) involves a bid-protest regarding a government contract.  The court’s opening offers a brief insight on the complex world of DOD governmental contracts.

This bid-protest case arises from a peculiar procurement mechanism. Contracting officers often must discuss deficiencies and significant weaknesses in proposals with
offerors before proposals are final. And so when an offeror proposes a price that is unreasonably high (so as to preclude an award), the government must discuss that unreasonableness with the offeror, potentially giving it a chance to revise its proposal to fix what may have went wrong. If the price is too high yet not unreasonable, the government need not discuss it and the offeror need not get another try. The upshot is that an offeror whose initial proposal is unreasonably priced may fare better than one whose isn’t.

Here, six firms vied for spots to perform logistics work for the Army across the globe. DynCorp lost. Its prices were higher than its competitors’; its proposed technical approach was worse. After balancing four proposal-evaluation factors, none of which DynCorp was best on, the Army went with other offerors.

Now DynCorp argues that the price it gave the Army was so high as to be unreasonable—and that the Army should have concluded as much and given it the opportunity to revise its proposed approach. DynCorp takes issue with the Army’s price-reasonableness analysis, which it says skirted regulatory requirements and was irrational besides.

The Court of Federal Claims dismissed DynCorp’s bid protest, finding no error in the Army’s analysis. As we explain below, we agree. Accordingly, we affirm.

Slip Op.

37 thoughts on “The First Offer Should Be Unreasonable – and Other Oddities of Government Contracting

  1. 6

    As of today, ’46 has taken longer to nominate a USPTO Director than ’45 took.

    Boo.

    1. 6.1

      …whatever happened to that supposed new cabinet level position for directly managing innovation?

    2. 6.2

      Getting rid of Lying Tool Iancu was a huge improvement all by itself. Now Iancu is free to praise Orange Julius until the cows come home. And of course he’ll take money from whoever to sit before a microphone and spew his “expertise” about opening up the patent spigot (so impressive!).

      1. 6.2.1

        >Now Iancu is free to praise Orange Julius until the cows come home.

        Has Iancu actually done so since the inauguration? I’ve been under the impression that Iancu recognized that Trump was a scoundrel, and merely played a part to get/keep his position. It’d actually bump up my rather low esteem for Iancu if he stayed loyal to team Trump.

  2. 5

    Also OT (I can imagine that the editors here are falling a bit behind on the news cycle), but yet another atrocious 101 decision has been rendered:

    link to cafc.uscourts.gov (precedential)

    Before TARANTO, WALLACH,* and STOLL, Circuit Judges.

    STOLL, Circuit Judge.

    * Circuit Judge Evan J. Wallach assumed senior status on May 31, 2021.

    1. 5.1

      Under Ultramericial by Laurie there is almost no software that is patent eligible. It turns it into an EPO standard where there has to be some technical problem solved and probably the technical problem of simulating hardware. Note that this is logically inconsistent with the assumptions in the opinion.

      Rader really failed the patent bar by resigning and allowing Laurie to dominate the 101 subject matter. Note too that Ultramericial (Rader) could merely have added a couple of paragraphs as to why Alice did not apply such as that this was not old and notoriously known. And we would have a cabined Alice and rational patent system.

      Laurie should go down as one of the most infamous anti-patent judicial activists in the history of patent law. Right up there with Stern who was responsible for Benson. And right up there with Alice/Mayo.

      1. 5.1.1

        L•O•U•R•I•E not Laurie.

        1. 5.1.1.1

          I always have problems with the names of people I detest.

    2. 5.2

      You really should re-read Ultramericial the Rader version and the Laurie version.

      Untold BS has spewed forth because of Laurie. Laurie intentionally did everything he possible could to eviscerate the eligibility of information processing with Ultramericial. Laurie has to be one of the most biased judicial activists in the history of patent law. A complete and total disgrace and unfit to serve.

        1. 5.2.1.1

          2014-11-14 is the Laurie one.

          2011-09-15 is the Rader one.

          What happened is the Scotus sent it back down after Bilski and Alice.

          Laurie shaped patent law for information processing with his opinion.

          1. 5.2.1.1.1

            Congress is whom should be taking serious note of this re-writing of Statutory law that is impacting the modern world’s largest area of innovation (via the Fifth Kondratiev Wave).

            1. 5.2.1.1.1.1

              I know anon.

              But you can really see what Laurie did by reading these two opinions together. Laurie completely re-wrote 101 for information processing with that one opinion.

              Consider that one or two paragraphs would have been added to Rader’s opinion that merely said that Alice is not applicable as the subject matter is not well-known but rather new. Alice could have been cabined to something well-known implemented on a computer with nothing more. So just a special 103. Instead we have an unholy mess.

            2. 5.2.1.1.1.2

              “the Fifth Kondratiev Wave”

              Get your horse dewormer right here, folks!

              1. 5.2.1.1.1.2.1

                Lol – maybe if you actually studied innovation, you would recognize BOTH that the term is not political, and that the term is accurate.

                But that would mean that you would have to pull your head out.

  3. 4

    OT, but I had to go through and reread Ultramercial and look through the procedural history.

    You know this case is probably as important in patent law as any case. What we see is the first Ultramercial with Rader writing the opinion and it setting a rational basis for 101 and software. And then it was remanded after Alice to the CAFC. There was no prejudice nor any implication that the result had to be changed just that Alice was such a big decision that Ultramercial should include an analysis of Alice.

    What happened was that Laurie (with a Mayor concurrence) then wrote the next Ultramericial and set-up the entire structure of 101 and software that we live with today.

    1. 4.1

      And I had to go through this for a case I am working on at the PTAB to try and get over a 101 rejection.

      1. 4.1.1

        Good luck with that — the PTAB is even worse than the CAFC.

    2. 4.2

      Ultramercial with Laurie also set up Williamson and all the 112 disasters to follow.

      Ultramercial is probably as influential a decision in patent law as Benson or Alice.

      And it was written by Laurie who understands nearly nothing about computers.

      1. 4.2.1

        “ Williamson and all the 112 disasters to follow.”

        Oh, the humanity! Name one of the “disasters” which followed Williamson and explain why it was a “disaster.”

  4. 3

    Totally off topic, but the CAFC (MOORE, Prost, O’Malley) handed down an important new WD precedent today in Juno v. Kite. Worth checking out.

    1. 3.1

      Link perhaps there big bruhzinsky?

      link to cafc.uscourts.gov

      Not sure how it is a big deal precedent and all, but it does seem sort of like they kinda hit them hard on the WD req. But in those kinds of circumstance at issue in that case I believe it’s always been that way. Doesn’t seem that new to me.

      1. 3.1.1

        That Juno v. Kite Fed. Cir. 112 written description decision against a broadly generic drug claim is of interest re the $1.2 Billion size of the CD CA jury verdict being reversed.

        1. 3.1.1.1

          lines that may cause one to remember anon’s views from that decision include:

          page 6: “A ‘mere wish or plan’ for obtaining the claimed invention is not adequate written description.”

          pages 6-7: What is required to meet the written description requirement “varies with the nature and scope of the invention at issue, and with the scientific and technologic knowledge already in existence.”

          page 7: “The written description requirement [ ] ensures that when a patent claims a genus by its function or result, the specification recites sufficient materials to accomplish that function.” Generally, a genus can be sufficiently disclosed by “either a representative number of species falling within the scope of the genus or structural features common to the members of the genus so that one of skill in the art can ‘visualize or recognize’ the members of the genus.” “A written description of an invention involving a chemical genus, like a description of a chemical species, ‘requires a precise definition, such as by structure, formula, [or] chemical name,’ of the claimed subject matter sufficient to distinguish it from other materials.”

          (internal citations omitted)

          Note here how the “non-predictable” arts MUST include more, and that other arts, oh, say, mechanical arts or computing arts simple needs less to be included.

          1. 3.1.1.1.1

            Nice to hear the admission that there is very little unpredictability in the writing logic instruction for computers “art”.

            Please continue to make this correct point over and over again. Then we can discuss 103 and the proper practice of ignoring language in “new” logic claims that are only descriptive of the data content.

            1. 3.1.1.1.1.1

              What you consider “admission” is nothing of the sort.

              This is not a new position from me – but then again, you already knew that, eh?

              So if you want to actually discuss 103, I am right here waiting.

              Oh wait, I have long put to you the exceptions to the printed matter doctrine that show how you are in plain error with your views on the computing arts.

              Ah, just like old times, eh Malcolm?

        2. 3.1.1.2

          Paul: “ That Juno v. Kite Fed. Cir. 112 written description decision against a broadly generic drug claim is of interest re the $1.2 Billion size of the CD CA jury verdict being reversed.”

          Agreed. Otherwise it’s just a predictably correct application of the law. Good work by the CAFC to crush the ridiculous lower court decision.

    2. 3.2

      This is huge and as I said before 112 is the new fighting border of limiting patents. And Moore is not a pro-patent person and doesn’t seem to understand despite her technical background the way people in science/technology work. She signed onto Williamson which is nearly criminal in how it invalidated many thousands of patent applications unjustly.

      Moore with 112 is in bed with Taranto and a disaster as a judge. I said when she was appointed that she was lightweight that tended to be anti-patent.

      1. 3.2.1

        I would not get too carried away with this Juno decision, as it is easily distinguishable based on its emphasis on “the unpredictable arts” (NOT an affliction to SO MANY other art areas of innovation).

      2. 3.2.2

        “ 112 is the new fighting border of limiting patents”

        It’s not new and also the only possible result is that your favorite patents are going to get tanked more often.

  5. 2

    Found an OT point of interest for discussion by perhaps some our pharma experts and lurkers. The Pfizer COVID-19 ‘vaccine’ now called “Comiraty” obtained FDA approval as a biologics. The approval letter is marked, “BLA Approval.” BLA stands for “Biologics License Application. As I recall, ‘biologics’ was a new category created in the AIA,(AKA, the pharma compromise) that provided a 7 period of exclusivity upon approval by FDA (no patent needed). And I recall that biologics was this new (small?) category of ‘living’ stuff (in contrast to a drug or something dead) stuck into people. At present, FDA now has a purple book as well as orange book. I assume (correctly?) that the purple book is for the ‘biologics.’ Does the inventor (or drug promoter seeking approval) just get to pick whether they want the biologics protection or the orange book protections?

    1. 2.1

      The FDA decides whether your drug properly classifies as “biological” or not. A lot of legacy biologicals (e.g., insulin) are still listed in the Orange Book, but new biologicals go to the Purple Book whether the sponsor likes it or not.

      1. 2.1.1

        What makes something a biologic and not a drug?

        1. 2.1.1.1

          “Biologicals” are susceptible to conformational changes (including death, in the case of cell therapies), so the standards for approving a biological are stricter than the standards for “drugs.” Basically, aspirin (a drug) is aspirin (it does not degrade on the shelf at room temp.), but monoclonal antibodies (biologicals) unfold and become impotent with time and temperature.

          Incidentally, the period for data exclusivity with a new BLA is 12 years, not 7.

        2. 2.1.1.2

          It’s complicated, but the FDA has a good explanation I think.

          link to fda.gov

    2. 2.2

      Nice exchange.

  6. 1

    Smacks of 1984.

    [irony intended]

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