Bid disputes

The following is a general description of the bid protest process and is strictly for informational purposes. The Bid Unit retains the right to deviate from these general procedures in the fulfillment of its statutory obligations.

Nature of a bid protest

A complaint or allegation that the Bid Laws have been violated is a "bid protest." Bid protests generally arise from an allegation that the awarding authority has violated the state bidding laws during the prequalification or bid solicitation stage; or that a bidder has violated the bidding laws in its bid; or that an awarding authority has violated the bidding laws in the award of the contract.

NOTE: Under the Bid Laws, bid protestors have the right to file a bid protest with the AGO's Bid Unit or to file a civil action in Superior Court to restrain an awarding authority from taking certain action, such as, awarding or rebidding a particular contract. Such civil actions are generally brought as preliminary injunction / declaratory judgment actions. Only a court can issue a mandatory order under the Bid Laws or an award of monetary damages, such as, bid preparation costs or lost profits.

Resolving an alleged bid violation prior to the filing of a bid protest

Because the bid protest process can be time-consuming and costly to all parties, the Attorney General's Office strongly encourages prospective bidders or interested parties to contact the awarding authority or the AGO's Bid Unit prior to the submission of bids or protests in an effort to clearly identify and resolve an alleged violation of the state's Bid Laws. The AGO is ready and willing to assist in the resolution of potential bid protests by contacting awarding authorities during the bid solicitation or award process to call attention to possible bid law violations. In recent years, it has been the experience of the AGO that many potential bid protests have been successfully averted by communicating the concerns of potential protestors directly to the awarding authority or to the AGO's Bid Unit.

Timeliness of filing protests

Delays in the bidding process can result in a significant increase in costs for an awarding authority. All interested parties should file protests as soon as they become aware of the issues to protect the integrity of the bidding process and safeguard against needless waste. The Bid Unit will scrutinize all protests to determine whether a delay in filing a protest, particularly when the work has already begun, should result in the denial of the protest as untimely. Complaints regarding contractor prequalification issues, such as undisclosed litigation, should be made to an awarding authority within 14 days after the prequalification process is closed and the awarding authority has released prequalification information. Contractors should not wait until after the contract has been awarded to contest prequalification issues. The Bid Unit retains the discretion to hear and decide a protest regardless of the timeliness of filing if it determines that such a decision is warranted.

What happens after the Bid Unit receives a protest?

The Bid Unit processes the protest, and reviews the matter to determine whether a bid protest hearing is necessary to assist it in its investigation.

Generally, the Bid Unit may choose to not hold a hearing where:

• the bid protest fails to state a violation of the Bid Laws;
• the bid protest becomes moot; or
• there are no disputed, material facts and a decision can be rendered as a matter of law.

If the Bid Unit determines that a particular protest warrants a hearing, the hearing is usually held within 10 days of receiving the protest. A number of circumstances may necessitate a delay in the scheduling of a protest, including a request by parties for time to review a particular matter or a request by an awarding authority for further time to investigate allegations in order to provide a complete response to the protest.

Prior to the bid protest hearing, the Bid Unit sends the protestor and the awarding authority a notice of the date and time of the hearing. The notice informs the parties that they are required to submit written position statements no later than two business days prior to the hearing and that they must send a copy of such statement to the other parties to the bid protest hearing. In most circumstances, the notice will request that the awarding authority refrain from awarding or performing work prior to resolution of the bid protest.

The awarding authority is required to forward the notice of hearing and a copy of the protest to the apparent low bidder, if any, whose actual or potential award is the subject of the protest, as well as to any other bidder whose bid is being challenged. Where a bid protest challenges specific provisions in the bid documents or the process, the awarding authority should forward the notice of hearing to all potential bidders or awardees directly affected by the subject of the protest. The awarding authority must thereafter provide written confirmation to the Bid Unit that it has provided notice to the above referenced parties of the hearing.

The bid protest hearing — what to expect

Bid protest hearings are held virtually using a web-based platform.  In-person hearings may be accommodated at an AGO Office, if needed. The hearings are open to the public. All interested parties may attend, and may participate and present testimony and evidence at the hearing, subject to the discretion of the Assistant Attorney General overseeing the hearing. Parties may be represented by counsel, but are not required to be.

Because bid protest hearings are part of the Bid Unit's investigation as to whether a violation of Bid Laws has occurred, the Bid Unit requests that parties present any information that may assist it in its investigation. Such information may come in the form of testimony from witnesses or through the presentation of documentary evidence, if relevant, such as: bid specifications; lists of past projects performed; and evaluations from past projects. Audio of the hearing will be digitally recorded.

Since the bid protest hearings are part of the Bid Unit's investigation, as opposed to court proceedings or administrative hearings, neither the rules of evidence nor administrative procedures apply. Therefore, there is no cross-examination or hearsay objections.  After the parties have had an opportunity to present evidence, and have answered follow-up questions posed by the Assistant Attorney General overseeing the hearing, the record will generally be closed and parties will not be allowed to submit additional information. Subject to the discretion of the Assistant Attorney General overseeing the hearing,  the parties may be allowed to submit supplemental information after a hearing.

In reviewing a bid protest, the Bid Unit usually evaluates and answers one or more of the following questions: 

• Did the awarding authority violate the Bid Laws by failing to adhere to certain statutory requirements in awarding the public construction contract?
• Did the awarding authority violate the Bid Laws by awarding the public construction contract to a contractor who had violated the statutory provisions of the Bid Laws?
• Did the awarding authority violate the Bid Laws by making arbitrary decisions regarding bidder eligibility or qualifications?
• Did the awarding authority violate the Bid Laws by improperly or unfairly reviewing bids  for the project?
• Was DCAMM's decision not to certify or to decertify the contractor arbitrary or capricious or based on an erroneous interpretation of the law?

Unless circumstances warrant otherwise, a bid protest decision should issue within three weeks of the hearing. Depending on the complexity of the legal or factual issues involved in a particular case, a decision may issue after the three week period. In order to expedite decisions, the Bid Unit may issue an abbreviated decision to be followed later by a formal decision. Parties are advised to inform the Assistant Attorney General overseeing the hearing of any extraordinary circumstances that would warrant an expedited decision.

Bid decisions that find that an awarding authority violated the Bid Laws may:

• instruct the awarding authority to rebid a project;
• remand the matter to the awarding authority to complete the review it must undertake under the Bid Laws;
• require the awarding authority to reject a particular bidder (for failing to meet the requirements set forth by either the awarding authority or the relevant Bid Law);
• suggest that the awarding authority rewrite an unclear provision in its bid specifications; and/or
• suggest that an awarding authority add or delete language from the bid specifications to conform to the goals and objectives of the Bid Laws. In the case of 4) or 5), the revisions may require a re-bid.

Monetary damages are not available through the AGO bid protest process

The AGO's Bid Unit is not authorized to award money damages of any kind. As such, monetary damages, such as bid preparation costs or lost profits, cannot be redressed by a bid decision of the AGO.

Appeal from an AGO bid decision

Since AGO bid protest decisions are findings, as opposed to administrative decisions under M.G.L. c. 30A (the Administrative Procedure Act), they are not subject to a formal appeal or review process. Parties who wish to challenge the findings made by the Bid Unit can bring a declaratory judgment action / preliminary injunction in Superior Court to attempt to enjoin the awarding authority from proceeding with a contract if, for example, a protest challenging the award of a contract is denied by the AGO. 

AGO hearings in DCAMM certification appeals are held pursuant to M.G.L. c. 149, § 44D(4).  They are quasi-judicial proceedings and are binding on the parties.

For further information about AGO bid protests or certification appeals, please contact the Bid Unit at: (617) 963-2371 or email us at: AGOBidUnit@mass.gov.

Choice of forum

The Office of the Attorney General provides one forum for the resolution of protests regarding public bidding procedures. The Superior Court provides another.

If brought before the Office of the Attorney General, the Office will conduct an investigation to determine whether a violation of the bidding procedures has occurred. This investigation is usually accomplished through a bid protest hearing with the relevant parties. If it is found that a violation has occurred, the Office of the Attorney General will instruct the awarding authority as to the proper action to take to remedy the problem.

Many bid disputes brought before the Office of the Attorney General receive a hearing to resolve the matter. The hearings allow the parties an opportunity to present fully the relevant facts and law regarding the protest. Other bid disputes, however, are resolved without a hearing. A hearing is not held or considered necessary if the facts of the matter are not in dispute and the crux of the protest centers on a well settled principle of law.

Nature of the proceeding

The Attorney General's Office does not convene formal adjudicatory proceedings pursuant to M.G.L. c. 30A to resolve bid protests. The proceedings are investigatory, rather than formal adversarial proceedings. Certification appeals are also informal, although the proceedings are quasi-judicial.

The hearing officer designates the order in which the testifying witnesses will be heard. A party may present any relevant documentation and make any statements in support of its position. While the rules of evidence are relaxed due to the nature of the proceeding, at the time of decision the hearing officer will determine what weight or credibility to give any document or statement offered into evidence.

Parties may not question the opposing parties.

Decorum

No person shall address a Bid Protest Hearing without permission of the Assistant Attorney General, and all persons shall, at the request of the Assistant Attorney General, be silent. No person shall disrupt a Bid Protest Hearing. If, after clear warning from the Assistant Attorney General, a person continues to disrupt the proceedings, the Assistant Attorney General may order the person to withdraw from the hearing.

Orders prior to the hearing

The Attorney General's Office does not issue orders for discovery, depositions or subpoenas.

Burden of Proof

The burden of proof is on the protestor to demonstrate that an illegality in the bidding procedures has occurred.

Memoranda and briefs

Briefs and memoranda must be filed two business daysprior to the hearing. Post-hearing briefs and memoranda may be filed at the discretion of the hearing officer, depending on the complexity of the issues raised at the hearing.

Post-hearing appeals

After a bid protest hearing and decision by the Attorney General's Office, any aggrieved party may appeal to the Superior Court. The proceeding in the Superior Court is de novo. Note, however, that the Supreme Judicial Court has held that a Superior Court judge did not abuse his discretion in granting injunctive relief where the substance of a bid protest decision indicated that the plaintiff had a reasonable likelihood of success on the merits.

Thus, many prefer to file a bid protest with the Attorney General's Office as an initial step. First, an unfavorable outcome can be tried again in another forum. (The same is not true of the converse - as a matter of policy, the AGO will not conduct a bid protest hearing on a matter that has been heard in Superior Court.) Second, a favorable outcome from the AGO may assist an effort to obtain injunctive relief, if such a remedy is necessary.

When reviewing bids, an awarding authority sometimes is confronted with a bid that contains some type of deviation. The proper action to take with respect to the bid depends upon the type of defect contained in the bid. A 1989 decision by the Massachusetts Appeals Court sets forth an excellent summary of the established tenets of bid review.

General principles of bid review include the following:

Bid Error - Statutory Requirement (Substance)
General Rule: If a bid deviates from a statutory requirement of substance, the bid must be rejected by the awarding authority.

Bid Error - Bidding Specifications (Price, Scope, or Fair Competition)
General Rule: If a bid deviates from a requirement of the bidding specifications which affects the price or scope of work, or fair competition, the bid must be rejected by the awarding authority.

Bid Error - Bidding Specifications (Not Price, Scope, or Fair Competition)
General Rule: If a bid violates a requirement of the bidding specifications and the requirement is neither a statutory requirement of substance nor a requirement that affects the price or scope of the project work or fair competition, the awarding authority has the discretion to either accept or reject the bid.