Xerox Protests Loss of Massive U.S. Defense Contract to HP Supplier

The U.S. Government Accountability Office (GAO) has just publicly released its report on a protest by Xerox concerning a multi-million-dollar contract that was awarded to Trident Engineering and Procurement of Pottsville, Pennsylvania, to supply HP Inc. printers and MFPs to the U.S. Department of Defense.

The GAO is an independent, non-partisan agency that works for the U.S. Congress to report on how tax dollars are spent by the U.S. government and its agencies, and provides information to help them work more cost-effectively.

Background

Earlier last year, both Xerox and Trident responded to a U.S. Defense Logistics Agency (DLA) request for proposal for printers and MFPs that would be deployed on U.S. Navy, Coast Guard, and Marine ships, and other U.S. government vessels, for a seven-year period.

After reviewing and accepting both Xerox’s and Trident’s applications, the DLA invited both Xerox and Trident to join in a reverse bid auction. The company offering the lowest price would be awarded the contract.

Based on this process, Trident’s offer of $131,530,317 was accepted. Xerox then filed a protest.

Xerox Protest

Xerox argued that the DLA improperly administered the reverse auction, and that it also erroneously evaluated Trident’s proposal. The GOA took up the task of evaluating Xerox’s protest.

Xerox argued that, although Trident’s proposal claimed to be offering all HP products, two classes of the devices Trident offered are actually manufactured by Canon.  Xerox therefore maintained that DLA should have rejected Trident’s proposal for this reason.

However, the GAO ruled that there were no merits to this allegation, and also ruled that the reverse bid auction had been conducted properly. It noted that the DLA specifically asked Trident for documentation from HP showing that the two classes of devices were in current production by HP, and and would remain in production for six months after the contract was awarded. HP’s chief technology officer also provided a letter confirming this.

In August 2021, the GOA made its decision for Trident, but just recently made the decision available publicly. It noted: “In the final analysis, Xerox essentially was outbid by Trident’s strategic use of the reverse auction process that was outlined for both companies, and now seeks to have another opportunity to revise its price.  We have no basis to conclude that the agency’s actions were unreasonable or otherwise inconsistent with the rules of the reverse auction.  We therefore deny this aspect of Xerox’s protest.”

The complete GOA report can be accessed here.

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