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B-295585 1 (2005-03-11)

handle is hein.gao/gaocrptaquv0001 and id is 1 raw text is: A G A O Comptroller General . Accountability * Integrity * Reliability of the United States United States Government Accountability Office Washington, DC 20548 Decision Matter of: Government Scrap Sales File: B-295585 Date: March 11, 2005 Joseph Summerill, IV, Esq., and Frances Gardner, Esq., Barnes & Thornburg LLP, for the protester. Craig A. Holman, Esq., and Kara L. Daniels, Esq., Holland & Knight LLP, for Liquidity Services, Inc., an intervenor. Joel Zimmer, Esq., Defense Logistics Agency, for the agency. Scott H. Riback, Esq., and John M. Melody, Esq., Office of the General Counsel, GAO, participated in the preparation of the decision. DIGEST Protest that proposed awardee of scrap property contract has an impermissible organizational conflict of interest (OCI) because a subsidiary company performs a related surplus property contract is denied; the theoretical possibility that the awardee will act in bad faith under its contract does not establish an OCI, and provides no other basis for denying firm the award. DECISION Government Scrap Sales (GSS) protests the proposed award of a contract to Liquidity Services, Inc. (LSI) under invitation for bids (IFB) No. 99-4001, issued by the Defense Logistics Agency (DLA), Defense Reutilization and Marketing Service (DRMS) for the sale of scrap materials. GSS maintains that award to LSI will result in an improper organizational conflict of interest (OCI). We deny the protest. BACKGROUND DRMS is responsible for the disposal operations of the Department of Defense (DOD), including the reutilization, transfer, donation and sale of surplus DOD property. The sale of surplus property is accomplished through the award of contracts for the sale of property to vendors that in turn resell the property. DRMS utilizes two surplus property contracts: the commercial venture (CV) contract,

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