GAO Supports Claim That Boeing SDB Award Was 'Tainted'

Defense Daily 02/22/05
author: Geoff Fein

The Government Accountability Office Friday sustained Lockheed Martin's [LMT] protest that the decision to award the Small Diameter Bomb (SDB) contract to Boeing [BA] was tainted by the improper involvement and influence of an Air Force procurement official.

GAO recommended the Air Force hold a competition for specific technical requirements for the SDB that had been deleted from the original competition. Lockheed Martin officials contend that omission of those requirements benefited Boeing.

"Resolution of this protest allows the Air Force to continue moving forward in repairing the harm caused to its acquisition system by the illegal and unethical actions of Ms. [Darleen] Druyun. We commend GAO's prompt adjudication of the protest and will address their ruling accordingly," an Air Force spokesman said.

A Boeing spokesman said company officials had not yet seen a copy of the GAO decision and therefore were not in a position to comment on the outcome.

"We would note that the Air Force made the award to Boeing 10 months after [Darleen] Druyun retired," the spokesperson said. "Boeing's work on the SDB contract continues on schedule and on budget. We await our customer's decision on future contract phases. We stand ready to compete based on any Air Force decision."

Lockheed Martin [LMT] filed a formal protest, Nov. 10, 2004, concerning the Air Force's award of the contract to Boeing. Lockheed Martin alleged that the decision to award a contract to Boeing for the SDB "was tainted by the improper involvement and influence of Darleen Druyun, particularly in modifying the contract requirements in a way that favored Boeing," according to GAO.

"With regard to the SDB procurement, GAO sustained Lockheed Martin's protest because the record showed that [Druyun] was involved in the decision-making process that culminated in changes made to evaluation factors--including deletion of specific technical requirements," according to GAO.

"The record further showed that the Air Force currently intends to amend Boeing's contract on a sole-source basis to add those previously deleted requirements. GAO recommends that, rather than making this sole-source addition to Boeing's contract, the Air Force conduct a competition for those requirements," the report stated.