By Geoff Fein
Lockheed Martin [LMT] Maritime Systems and Sensors (MS2) was the only company capable of performing the requirement of three Navy solicitations for Aegis Ballistic Missile Defense work and awarding the contracts to another company would result in “unacceptable delay and a substantial duplication of cost,” according to the service.
The Navy submitted its 71-page response to Raytheon [RTN] Integrated Defense Systems’ (ISD) protest over the award of the three Aegis contracts for:
- Production of 14 Multi-Mission Signal processor sets, 13 Ballistic Missile Defense 4..1 sets, and multiple configurations of equipment upgraded as part of the Aegis Modernization (AMOD) program (5110 procurement);
- Platform System Engineering Agent (PSEA) efforts associated with the Aegis Weapons System (5121 procurement); and
- Research and development associated with AMOD Advanced Capability Build (ACB) software and hardware upgrades (5123 procurement).
According to a redacted version of the Navy’s response, “Lockheed Martin is the only contractor that possesses the experience, knowledge, technical expertise, integration and testing capabilities and facilities necessary to perform these requirements to ensure the Navy’s fleet critical operational commitments are met.”
Additionally, the Navy noted that Lockheed Martin is the only company capable of concurrently upgrading the existing Aegis Weapon System (AWS) software and compete the initial installation of a fully integrated Family of Systems (FoS) on Aegis cruisers and destroyers in 2012.
“Existing laws and regulations empower the military services and all government agencies to make amply justified sole source awards for good reasons, including avoidance of the disruption, added cost and delays that would result if ongoing programs were continually recompeted and passed from contractor to contractor,” Craig Quigley, a Lockheed Martin spokesman, said. “Lockheed Martin respects the decisions our customers make in awarding to others work similar to that involved in the three Aegis sustainment and development contracts that have been challenged. While we would prefer to focus on performing this important work, we are prepared to provide any support the Navy may require.”
Although Raytheon had submitted statements of interest to perform the work, according to the Navy’s Oct. 22 report to GAO, the company did not provide sufficient information to demonstrate it could meet the Navy’s recruitments. However, in three letters sent to Raytheon, the Navy noted that: “If Raytheon believes that it can meet the government’s recruitments in accordance with the strict schedule constraints described in this letter, and without substantial duplication of costs, please submit a written explanation no later than [date].”
The Navy also stated Raytheon should address “specific, critical factors–aspects of the Navy’s requirements that the service deems particularly fundamental.”
Among the nine critical factors were: ability to execute Advanced Capability Build 12/Technical Insertion 12 Preliminary Design Review in November 2008 and Critical Design Review in November 2009; ability to immediately support the ion-service fleet with detailed knowledge of baseline 5.3, 6.1, 6.3, 7.1 and 7.1R.
According to the Navy, in a subsequent response, Raytheon “did not acknowledge the Navy’s request for information regarding the critical factors, or the Navy’s statement that, in the absence of further information establishing that Raytheon could meet the government’s recruitments, the Navy intended to award contracts to Lockheed Martin as a sole source.”
Following the exchange with the Navy, Raytheon filed its protest with GAO on Sept. 22.
According to the 36-opage redacted version of its protest, Raytheon officials believe the Navy’s justification for awarding sole source contracts to Lockheed Martin was incorrect, because there was good reason to believe Raytheon could perform the recruitments, and thus should have been allowed to compete for the work.
“Raytheon is more than capable of providing the requirements stated in this pre-solicitation notice,” according to the protest.
Raytheon said it provided detailed statements of interest and capability (SIC), showing the company’s ability to respond to the Navy’s needs, the protest said.
Raytheon took issue with the Navy’s assessment of the company’s capabilities, according to the protest. The Navy’s assessment, “glosses over the agency’s failure to provide government-owned data to potential contractors by hiding behind unsubstantiated claims of proprietary data. Either the Navy refuses to obtain the data for which it has already paid or has unreasonably neglected to secure those data rights in a timely manner. In any event, ample date exists that the Navy could provide to contractors to encourage full and open competition.”
But the Navy in its response maintained that Raytheon failed to adequately respond to the service’s request for information regarding its ability to meet Navy requirements.
The Navy said it outlined its requirements in greater detail than it had in the pre-solicitation notices and that Raytheon’s “statements of interest and capability were insufficient to establish that the company could meet the requirements of the proposed contract.”
Another issue raised by the Navy in its documents was what it says were the company’s speculative promise to assemble a national team to perform the proposed contracts.
According to the Navy, “Raytheon IDS offered no evidence it had negotiated arrangements with any other companies to be part of the team,” and that the Navy “had no reason to believe that Lockheed Martin MS2, the sole developer and integrator of AWS, would agree to such an arrangement.”
Additionally, the proposed national team, which included General Dynamics [GD] Advanced Information Systems, would be “fundamentally anti- competitive,” the Navy said.
The Navy noted that Raytheon’s proposal to include Lockheed Martin MS2, “was a striking concession that Raytheon IDS could not otherwise meet the recruitments of the PSEA, AMOD development, an AWS hardware contracts.”
The Navy also noted Raytheon never requested any additional technical data or source code during the course of its exchanges with the service.
In the end though, the Navy said it was justified in awarding the three sole source contracts because “the existing baselines of the AWS and the effort associated with ACB 12 are so complex, Raytheon IDS would face a learning curve too steep to perform effectively in compliance with the schedule, even if it had access to the technical data regarding current configuration of the AWS.”