HIGH CRITERIA INC.
v.
DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES
File No. PR-2013-039

Determination and reasons issued
Wednesday, April 16, 2014

TABLE OF CONTENTS

• DETERMINATION
• STATEMENT OF REASONS
  • BACKGROUND
  • PROCUREMENT PROCESS
  • ISSUE AND POSITIONS OF PARTIES
  • ANALYSIS
  • COSTS
  • DETERMINATION

 

IN THE MATTER OF a complaint filed by High Criteria Inc. pursuant to subsection 30.11(1) of the Canadian International Trade Tribunal Act, R.S.C., 1985, c. 47 (4th Supp.);

AND FURTHER TO a decision to conduct an inquiry into the complaint pursuant to subsection 30.13(1) of the Canadian International Trade Tribunal Act.

BETWEEN

HIGH CRITERIA INC. Complainant

AND

THE DEPARTMENT OF PUBLIC WORKS AND GOVERNMENT SERVICES Government Institution

DETERMINATION

Pursuant to subsection 30.14(2) of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal determines that the complaint is not valid.

Pursuant to section 30.16 of the Canadian International Trade Tribunal Act, the Canadian International Trade Tribunal awards the Department of Public Works and Government Services its reasonable costs incurred in responding to the complaint, which costs are to be paid by High Criteria Inc. In accordance with the Guideline for Fixing Costs in Procurement Complaint Proceedings, the Canadian International Trade Tribunal’s preliminary indication of the level of complexity for this complaint case is Level 1, and its preliminary indication of the amount of the cost award is $1,000. If either party disagrees with the preliminary indication of the level of complexity or the preliminary indication of the amount of the cost award, it may make submissions to the Canadian International Trade Tribunal, as contemplated by article 4.2 of the Guideline for Fixing Costs in Procurement Complaint Proceedings. The Canadian International Trade Tribunal reserves jurisdiction to establish the final amount of the award.

Ann Penner
Ann Penner
Presiding Member

Dominique Laporte
Dominique Laporte
Secretary

Tribunal Member: Ann Penner, Presiding Member

Counsel for the Tribunal: Alexandra Pietrzak

Registrar Officer: Haley Raynor

Complainant: High Criteria Inc.

Counsel for the Complainant: Matt Sereda

Government Institution: Department of Public Works and Government Services

Counsel for the Government Institution: Sarah Sherhols

Please address all communications to:

The Secretary
Canadian International Trade Tribunal
15th Floor
333 Laurier Avenue West
Ottawa, Ontario  K1A 0G7

Telephone: 613-993-3595
Fax: 613-990-2439
E-mail: secretary@citt-tcce.gc.ca

STATEMENT OF REASONS

BACKGROUND

1. On February 6, 2014, High Criteria Inc. (High Criteria) filed a complaint with the Canadian International Trade Tribunal (the Tribunal) under subsection 30.11(1) of the Canadian International Trade Tribunal Act,^[1] alleging that the Department of Public Works and Government Services (PWGSC) unfairly evaluated High Criteria’s bid in relation to a Request for Proposal (RFP) (Solicitation No. 47905-146354/A).
2. High Criteria complained that PWGSC improperly concluded that its bid did not meet four of the fourteen mandatory requirements of the RFP. High Criteria maintained that its bid did in fact satisfy all of the mandatory requirements included in the RFP.
3. As a remedy, High Criteria requested that its bid be considered fully compliant, and that it be awarded the contract. High Criteria also asked that the award of the contract be postponed pursuant to subsection 30.13(3) of the CITT Act.
4. On February 10, 2014, the Tribunal accepted High Criteria’s complaint for inquiry, as it met the requirements of subsection 30.11(2) of the CITT Act and the conditions set out in subsection 7(1) of the Canadian International Trade Tribunal Procurement Inquiry Regulations.^[2] However, as the complaint indicated that the contract had already been awarded, the Tribunal did not order a postponement of the contract award.
5. On February 19, 2014, counsel for PWGSC wrote to the Tribunal to request that the complaint be dismissed because, in its view, the Tribunal lacked jurisdiction. On the same day, the Tribunal wrote to PWGSC to request additional information regarding PWGSC’s request to dismiss the complaint.
6. On February 20, 2014, PWGSC wrote to the Tribunal to clarify that any alleged issues regarding High Criteria’s complaint, including its request for dismissal, would be addressed in its Government Institution Report (GIR).
7. PWGSC filed the GIR on March 10, 2014.
8. High Criteria did not file any reply in response to the GIR.
9. Given that there was sufficient information on the record to determine the validity of the complaint, the Tribunal decided that an oral hearing was not required and disposed of the complaint on the basis of the written information on the record.

PROCUREMENT PROCESS

10. On November 18, 2013, PWGSC issued an RFP on behalf of the Canada Border Services Agency for the supply and delivery of five digital audio/video recorder systems.
11. The RFP was amended twice. Amendment 001 was issued on November 28, 2013, and provided alterations to the mandatory technical specifications. Amendment 002 was issued on December 16, 2013, and extended the closing date for bid submissions to January 7, 2014.
12. While the exact date of High Criteria’s bid submission is unclear, PWGSC acknowledged that High Criteria submitted its bid prior to January 7, 2014.^[3]
13. On or around February 4, 2014, PWGSC informed High Criteria that its bid was unsuccessful, as it did not meet the mandatory technical specifications.^[4]

ISSUE AND POSITIONS OF PARTIES

14. The sole ground of complaint in this matter relates to whether PWGSC improperly concluded that High Criteria’s bid proposal did not satisfy the mandatory technical specifications set out in the RFP.
15. High Criteria argued that its bid was fully compliant, but that PWGSC either ignored or did not consider High Criteria’s responses when it conducted its evaluation.
16. PWGSC contended that, when responding to an RFP, the onus is on the bidder to show that its proposal satisfies each and every requirement of the RFP. PWGSC submitted that High Criteria failed to give sufficient information in its response to demonstrate that its bid met all 14 of the mandatory technical specifications set out in the RFP. As a result, PWGSC maintained that its evaluation of High Criteria’s bid was reasonable.

ANALYSIS

17. Subsection 30.14(1) of the CITT Act requires that the Tribunal limit its considerations to the subject matter of the complaint when conducting an inquiry. Furthermore, at the conclusion of the inquiry, the Tribunal must determine whether the complaint is valid on the basis of whether the procedures and other requirements prescribed in respect of the designated contract have been observed. Section 11 of the Regulations provides that the Tribunal is required to determine whether the procurement was conducted in accordance with the applicable trade agreements, which, in this instance, are the Agreement on Internal Trade^[5] and the North American Free Trade Agreement.^[6]
18. Subsection 506(6) of the AIT provides as follows:

. . . The tender documents shall clearly identify the requirements of the procurement, the criteria that will be used in the evaluation of bids and the methods of weighing and evaluating the criteria.

[Footnote omitted]

Similarly, Article 1015(4)(d) of NAFTA states that:

awards shall be made in accordance with the criteria and essential requirements specified in the tender documentation.

19. It is well established that, when considering the evaluation of a bid conducted by a government institution, the Tribunal must look to whether the evaluation in issue was reasonable. As set out by the Tribunal:

. . . PWGSC’s determination would be considered reasonable if it was supported by a tenable explanation, regardless of whether or not the Tribunal itself found that explanation compelling.^[7]

On this basis, the Tribunal has held that it will only interfere if the evaluators have wrongly interpreted the bounds of a requirement, have not applied themselves to the evaluation, have ignored vital information in the bid, have considered undisclosed criteria, or have otherwise conducted the evaluation in a way that is procedurally unfair.^[8]

20. Moreover, the Tribunal has been very clear that bidders bear the responsibility of demonstrating that their proposals are compliant with all mandatory requirements. In other words, bidders must “connect the dots” by specifically and completely describing how their proposals comply with all of a solicitation’s mandatory requirements.^[9]
21. Turning to the complaint at issue, High Criteria alleged that PWGSC did not conduct the procurement in accordance with the above principles. Rather, High Criteria argued that PWGSC ignored information provided in High Criteria’s bid when completing its evaluation. In particular, High Criteria submitted that PWGSC incorrectly found that High Criteria did not meet mandatory technical specifications 2.1, 2.3, 2.6 and 2.7.
22. The relevant mandatory technical specifications at issue, as well as High Criteria’s response and PWGSC’s rationale for deeming the response insufficient, are as follows:

Mandatory technical specification 2.1

Must provide a solid-state (SSD) digital video recorder with no hardrive or other working components – used of SSD memory only.

High Criteria Inc.’s response

The quoted Liberty system will only include Solid State Drives (SSD) without disc drives or other working components.

[PWGSC’s evaluation]

High Criteria Inc. failed to indicate that a digital video recorder was provided. The above response only stated that SSD drives would be used. A digital video recorder is essential to the system being a standalone solution.

Mandatory technical specification 2.3

DVR must provide video in 720x480 format (D1 in the industry standard MPEG2 codec) with two audio channels at 16 Bit, 48 KHz.

High Criteria Inc.’s response

The quoted Liberty System will provide video on 720x480 format or higher resolutions (D1 in the industry standard MPEG2 codec) with two audio channels at 16 Bit, 48 KHz.

[PWGSC’s evaluation]

High Criteria Inc. again failed to indicate that a digital video recorder was included. It only stated that video would be provided in the required format. A digital video recorder is essential to the system being a standalone solution.

Mandatory technical specification 2.6

The system must include a high-speed DVD recorder with the ability to export files to USB and quickly ‘burn’ the recorded video to DVD. The DVD must be region free and playable on any commercial DVD player. Burn speed must be less than 15 minutes per hour of video/audio.

High Criteria Inc.’s Response

The quoted Liberty Interview Recorder can quickly burn DVD discs with a burn speed of less than 15 minutes per hour of audio/video recorded. The system will truncate the files that exceeded the space on a single disc into multiple files written to multiple discs, with the appropriate metadata. The user is prompted to insert the required discs, and is shown the number of required discs at the start of the burn process. (High Criteria Inc. included a screen capture of the disc preparation and burning process).

[PWGSC’s evaluation]

High Criteria Inc. failed to indicate that the Liberty Interview Recorder could export files to USB and that a high-speed DVD recorder would be provided. Also, the response stated that the system could burn DVD discs, but failed to outline that a region free DVD was provided.

Mandatory technical specification 2.7

System must have one-touch simplified functions with touch-screen control of video recording, playback and DVD burning functions.

High Criteria Inc.’s Response

The Liberty Interview Recorder has simple VCR type controls for Start Recording, Stop Recording and Pause Recording. The Liberty Interview Recorder may be customized. (High Criteria Inc. included an image of an example of a user interface.)

[PWGSC’s evaluation]

High Criteria Inc. failed to indicate that the Liberty Interview Recorder had touch-screen control of video recording, playback and DVD burning functions.^[10]

23. In considering the mandatory technical specifications at issue together with the responses provided by High Criteria in its bid, the Tribunal finds that High Criteria failed to specifically or completely describe how its proposal would comply with the mandatory technical specifications at issue. As noted in the evaluation summaries provided by PWGSC, High Criteria’s bid response did not address several components or features that were explicitly listed in the mandatory technical specifications at issue. For example, High Criteria did not specify whether its proposed equipment:

• included a digital video recorder, as required by mandatory technical specifications 2.1 and 2.3;
• could export files to USB, or that a region-free DVD would be provided as set out in mandatory technical specification 2.6; or
• included the touch-screen controls required in mandatory technical specification 2.7.

24. In light of the evidence presented before it, and the deficiencies in the bid proposal submitted by High Criteria, the Tribunal finds that both the evaluation conducted by PWGSC and PWGSC’s resulting determination that High Criteria’s bid failed to meet the mandatory technical specifications in issue were reasonable.
25. Therefore, the Tribunal finds that the complaint is not valid.

COSTS

26. Having found that the complaint is not valid, the Tribunal awards PWGSC its reasonable costs incurred in responding to the complaint. In determining the amount of the cost award for this complaint case, the Tribunal considered its Guidelines for Fixing Costs in Procurement Complaint Proceedings (the Guideline), which contemplates classification of the level of complexity of cases on the basis of three criteria: the complexity of the procurement, the complexity of the complaint, and the complexity of the complaint proceedings.
27. The Tribunal’s preliminary view is that this complaint has a complexity level corresponding to the first level of complexity referred to in Appendix A of the Guideline. The complexity of the procurement itself was low, as it concerned the supply and delivery of five digital audio/video recorder systems. Similarly, the complaint was not complex, as it dealt with a single issue, namely, whether or not PWGSC correctly determined that High Criteria’s proposal was non-compliant with the mandatory technical specifications of the RFP. With regard to the proceedings, the Tribunal also finds that the complexity was low, as there were no additional procedural matters or additional submissions by the parties.
28. Accordingly, the Tribunal’s preliminary indication of the amount of the cost award is $1,000, which is payable by High Criteria to PWGSC.

DETERMINATION

29. Pursuant to subsection 30.14(2) of the CITT Act, the Tribunal determines that the complaint is not valid.
30. Pursuant to section 30.16 of the CITT Act, the Tribunal awards PWGSC its reasonable costs incurred in responding to the complaint, which costs are to be paid by High Criteria. In accordance with the Guideline, the Tribunal’s preliminary indication of the level of complexity for this complaint case is Level 1, and its preliminary indication of the amount of the cost award is $1,000. If either party disagrees with the preliminary indication of the level of complexity or the preliminary indication of the amount of the cost award, it may make submissions to the Tribunal, as contemplated by article 4.2 of the Guideline. The Tribunal reserves jurisdiction to establish the final amount of the award.