GAO Upholds USMC’s Corrective Action to Add Price Realism in Catalyst Solutions Protest

In its April 23, 2025 decision in Catalyst Solutions, LLC, B-423269.2, the Government Accountability Office (GAO) denied a protest challenging the scope of the United States Marine Corps’ (USMC) corrective action following an earlier protest by Catalyst Solutions. Catalyst initially objected to the award of a task order for program management support services under RFP No. M67854-24-R-3014 to Alexandria Insights, arguing that the USMC had unreasonably evaluated its technical proposal and had failed to justify awarding the contract to a higher-priced competitor whose price was 52% greater.

After Catalyst’s initial protest, the USMC took voluntary corrective action. This included amending the solicitation to add a price realism evaluation, allowing revised pricing, and re-conducting technical and tradeoff evaluations. GAO dismissed the first protest as academic, but Catalyst filed a second protest—this time arguing that the price realism component of the corrective action was unreasonable since the original protest did not allege flaws in the agency’s pricing evaluation or a lack of a realism assessment.

GAO firmly rejected this second protest. It held that federal agencies have broad discretion to determine the appropriate scope of corrective action, provided that the action is reasonably related to concerns arising during the procurement process. The GAO emphasized that its role is not to evaluate whether corrective actions align with the protester’s prior allegations, but whether the corrective actions are reasonable to address flaws the agency itself identifies.

Here, the USMC explained that it observed a wide disparity in pricing among the initial offers and had concerns that some of the low prices indicated a potential misunderstanding of the solicitation’s complexity and risks. Although Alexandria Insights—the higher-priced offeror—won the initial award, the agency recognized that a new evaluation process might lead to awarding the contract to a lower-priced offeror. To mitigate the risk of selecting an unrealistically low bid that could later fail in performance, the USMC decided to include a price realism analysis in its corrective action.

GAO concurred, citing its longstanding precedent that a price realism evaluation, even in fixed-price procurements, may be used to assess an offeror’s understanding of requirements or to identify risk. The agency’s rationale—that a significantly underpriced offer could result in poor contract performance and disruption to a critical radar program—was, according to GAO, well within its discretion and adequately justified.

Catalyst also alleged it would be competitively harmed because its price had already been revealed. GAO dismissed this concern, stating that the integrity of the competitive procurement process is a greater interest than the disadvantage an offeror may face from disclosure in a recompetition.

In sum, GAO upheld the Marine Corps’ authority to expand its corrective action to include a price realism evaluation, even when that issue had not been raised in the original protest. The decision, authored by General Counsel Edda Emmanuelli Perez, affirms the principle that agencies can—and often should—take proactive steps to mitigate procurement risk when flaws in evaluation or solicitation procedures come to light.

Disclaimer:
This summary is for informational purposes only and does not constitute legal advice. While care has been taken to ensure accuracy, this content is not guaranteed to reflect the latest legal standards or interpretations.