L.A. Systems v. Department of the Army and Defense Information Systems Agency

The Rock Island Defense Megacenter (Rock Island DMC), through the delegated procurement authority of the Defense Information Systems Agency (DISA) (collectively, the government) (defendants) decided to purchase two upgraded central-processing units (CPUs) and two additional expanded memory units. Amdahl Corporation, the incumbent supplier, proposed to provide all four units for under $50,000 each, for a total of approximately $200,000. Without engaging in a full-and-open competitive bid solicitation process, the government awarded the procurement contract to Amdahl. However, rather than issuing a single procurement award for all four items, the government issued four separate procurement orders, one for each item. With each procurement order, the government issued a statement of urgency to justify its failure to synopsize the procurement solicitation in the Commerce Business Daily (CBD) before awarding the contract to Amdahl. L.A. Systems (LAS) (plaintiff) filed a protest with the General Services Board of Contract Appeals (Board) challenging the government’s procurement contract award to Amdahl as an improper sole-source acquisition, arguing that (1) the government improperly fragmented Amdahl’s acquisition award into four parts to allow the government to employ simplified acquisition procedures rather than full-and-open competition; and (2) the government failed to comply with pre-award synopsizing requirements. The government challenged, arguing that (a) although funding for the entire procurement was approved, the funding was released in four different blocks and the procurement orders were issued for each item as funding became available; and (b) the acquisition was urgent, and therefore exempt from synopsizing requirements, because the government needed to spend the procurement funds before year-end.