PRODUCT OF INFORMATION SYSTEMS
GPO BCA 7-85
November 25, 1986
MICHAEL F. DiMARIO, Administrative Law Judge
OPINION
This appeal, timely filed on February 19, 1985, by Product of Information Systems (hereinafter
Appellant), 1850 Whittier Avenue, Costa Mesa, CA 92627, is from the final decision of Jules B.
Selvin, Contracting Officer, Los Angeles Regional Printing and Procurement Office, U.S.
Government Printing Office, Washington, D.C. 20401 (hereinafter Government or Respondent),
dated December 18, 1984, terminating Print Order 10200, Purchase Order N2518, Jacket No.
783-002, Program 1902-M, for default for "failure to produce an acceptable check copy and your
failure to perform as specified."
The decision of the Contracting Officer is affirmed and the appeal is denied for the reasons set
forth hereinbelow.
BACKGROUND
Appellant, by Purchase Order N2518 dated September 1, 1984, was among the multiple awardees of a
term contract, Program 1902-M, to produce such quantities of various books and pamphlets as
might be ordered by certain elements of the Department of the Navy from September 1, 1984
through August 31, 1985. (Appeal File, hereinafter "R4 File", Tab A) Pursuant to the contract,
Appellant was issued Print Order 10200 on September 20, 1984, to produce a certain publication
entitled "Navy UHF Satellite Communications System Description" for the Naval Ocean System
Center, San Diego, CA (hereinafter "NOSC"). The Purchase Order contained instructions as
follows: "Check copy required. Send Check Copy to NAVAL OCEAN SYSTEM CENTER, CODE 231 (Label
enclosed). DO NOT SHIP until check copy is approved. Make negs. 34 pages contain halftones.
All copies ship to: NCSC, address shown above." (R4 File, Tab B)
Thereafter, Appellant produced the check copy and shipped it as instructed. The check copy was
then rejected because of the following defects:
Page 85--Halftones for Figures 55 and 57 are transposed; Pages 13, 20, 38, 50, 51, 53, 54, 64, 69,
70, and 100--Loss of information; Front cover and text (approx. 57 pp.)--Uneven ink densities;
some copy with insufficient ink, some copy plugging up.
R4 File, Tab C
The Appellant was notified by letter of the Contracting Officer dated November 2, 1984, (R4
File, Tab C) which advised Appellant that he must correct all of the defects noted and deliver a
revised check copy via overnight services to NOSC by November 13, 1984, at no additional cost to
the Government. Appellant was further instructed that it was not to ship the completed order
until the revised check copy had been approved. Appellant was advised that its "written
explanation of the noted defects and the quality control measures implemented to guard against a
recurrence must be received in our office by November 15." (R4 File, Tab C)
By letter dated November 15, 1984, Appellant responded stating:
On Page 85, both prints were furnished labeled Figure 57 (please note that some numbers had
been changed two and three times). Perhaps the job should have been stopped at the camera at
this point and questioned but the truth is that we quite often get this kind of apparent
inconsistency and if we stopped for them all we would soon be out of business! We must assume
the "camera ready copy" is truly ready.
Pages 13, 20, 38, 50, 51, 53, 54, 64, 69, 70 and 100 appear to have loss of information. If
you will note that on pages 13 and 38, this information appears exactly as on the originals.
In the balance of the pages noted above, please note the variations in quality of the
originals submitted; i.e. yellowing copy, stains on veloxes, tape marks, unmortised
pasteovers, etc.
On all level IV contracts, in order to effect the economies our contract pricing reflects, the
pages are gauged into large flats when shot. A common reading for camera exposure is used and
with obvious variations in copy it is impossible to hold all the detail when the copy is poor.
For example, if we pinch back exposure to compensate for yellowing copy - some copy may be
lost in the process.
It seems that these are decisions (What to try or not try to hold?) that should not be
required of the printer when copy submitted is "Camera ready" under a contract such as 1902.
Neither, we feel, should the vendor on the 1902 contract (level IV) be required to read each
page with a densitometer and shoot it individually. We do this on all halftones with the
price considerably higher per unit (because individual attention is given to each).
"Uneven densities" or "inking", as the client referred to various pages, is also a result of
uneven originals as submitted. Please note the variation in velox densities throughout the
pages; they range from grey to white, to yellow, to acetate film positives, etc. It is truly
impossible to shoot these with any consistency without using a densitometer on every page!
As for the cover - dupes were made of a supplied negative. Perhaps more care might have been
given in making the dupes.
. . . .
Now we are asked to reprint the whole job - which when done - still will result in an
unacceptable job according to the customer standards. It is not possible to make a "silk
purse out of sow's ear" without our having magical qualities, which we sadly do not possess.
R4 File, Tab D
Upon receipt of Appellant's letter, a telephone discussion was held between the Appellant and
Respondent's representative wherein it was agreed that Appellant would furnish Respondent the
original camera copy that same date (November 16, 1984) for review against the rejected check
copy. After the review was completed, the record shows that the Appellant "agreed to reshoot
all illustrations to hold fine lines and furnish revised check copy (unbound) on 11-21." (R4
File, Tab E) The record also shows that Appellant on November 21, 1984, notified Respondent
that "webpress broke down. Will deliver check copy on 11-26." (R4 File, Tab E)
The Contracting Officer by letter of November 21, 1984, notified Appellant that since it had
"[f]ailed to deliver revised check copy as agreed. Original ship date has passed.", the
Respondent was considering terminating the contract for default and that pending a final
decision, Appellant would be "afforded the opportunity to present, in writing, any facts bearing
on the question to the Contracting Officer . . . within 5 days after receipt of this notice" in
order to determine whether its failure to perform arose out of causes beyond its control and
without fault or negligence on its part. (R4 File, Tab F)
Apparently, this show cause notice was followed by a subsequent show cause notice (although such
document is not contained in the appeal file) since Appellant, by letter dated November 28, 1984
(R4 File, Tab G), makes reference to "two show cause notices dated 21 and 26 November" and a
"recent meeting". The November 28 letter transmitted the revised check copy to the Contracting
Officer.
On December 10, 1984, a Navy Printing Procurement Service Office representative met with the
Contracting Officer and informed him that "[s]ince the contractor has failed to produce an
acceptable check copy and since there is no evidence that additional revised check copies will
prove otherwise, we propose to terminate subject print order due to default on the part of
Products of Information Systems." (R4 File, Tab I) As a consequence, the Contracting Officer
requested Respondent's Contract Review Board's concurrence to terminate the Print Order for
default since Appellant had "failed to produce an acceptable check copy and . . . there is no
evidence that additional revised check copy will prove otherwise". (R4 File, Tab I) The
concurrence was given with the Contracting Officer being so notified on December 18, 1984. (R4
File, Tab I) That same day the Contracting Officer notified Appellant in writing of the
termination. (R4 File, Tab J) Included in the notice was advice to Appellant that the product
might be "reproduced against your firm's account" and that in such event the "firm is being held
liable to the Government for any excess costs." Appellant responded to the termination letter
by sending a letter addressed to the Public Printer c/o the Contracting Officer referencing its
position as stated in its letter dated November 15, 1984, supra. (Official File, Tab 1) The
letter goes on to restate their "feeling regarding the lack of quality in the originals" and
that Appellant would like to have the original copies entered as Exhibit C as well as their
previously submitted revised check copy.
The Appellant then asserted in the letter that "[t]here was no indication of what was
unacceptable concerning the check copy, and us [sic], no longer in possession of the originals
have nothing against which to compare. What we do have are six skids of books, representing a
second printing which, we feel your using agent has capriciously determined are 'unacceptable',
which in truth, we would like to submit, may be due in large part to the condition of
'unacceptable' originals." (Official File, Tab 1)
By letter dated March 18, 1985, Appellant's President wrote to the Contracting Officer as
follows:
The purpose of this letter is to provide information to you regarding significant changes made
in our company organization.
As a result of a serious flu epidemic among our employees involving three separate flu viruses
in December, January and into the beginning of February, our work performance and schedules
suffered badly. Since our illness absentee rate was as high as 63% it was virtually
impossible to properly maintain schedules/re-schedules. Consequently we were unable to
deliver a number of jobs on a timely basis, and thus "spoiled" a long and continuing
reputation for qualitative and timely work performance. Even worse than poor performance,
however, was our apparent operating management unwillingness or inability to properly keep our
clients adequately informed of the problem(s), which lapse we recognize as inexcusable.
To our chagrin, we have learned that we failed to respond to telephone calls and letters and
on occasion even misrepresented job conditions, which malfeasance was hidden from company
senior management for a relatively long period of time. Illness in senior management ranks
probably contributed to the seriousness of the problem, but the real issue is that we were
totally unprepared for breaches of integrity at any management level. We have now "covered"
this deficiency by instituting double checks on numerous areas where control was previously
exercised by only one manager.
Furthermore, we wish to inform you that those responsible for the serious breaches in
communication and integrity are no longer employed here, and that daily operations management
has been taken over by myself and our Executive Vice President, Richard Deutsch. We believe
that we have now returned in performance and quality control to our traditional position of
excellence, and will hopefully now continue as superior performers for all time.
Please allow us to express our apology for any inconvenience(s) caused your office by our
management failures. We hope that we shall again be given opportunity to service your needs
whenever our bids are successful, and look forward to the opportunity of again proving our
worth.
R4 File, Tab P
No formal complaint or other additional correspondence from Appellant was received by this
Board. Accordingly, Respondent was requested to file its answer to the issues listed in
Appellant's February 19, 1985, letter. Respondent did so therein asserting that:
Appellant has presented no argument or evidence which would warrant further consideration.
Appellant chose to utilize a production method which resulted in poor quality negatives.
Appellant, however, could have used an alternative method which would have resulted in higher
quality negatives but at a higher cost to appellant. The choice was appellant's and appellant
bears ultimate responsibility for the consequences of that choice.
Official File, Tab 6
The case is before the Board for consideration in this form.
DECISION
The case file in this appeal contains no information concerning whether or not Appellant
abandoned its appeal. Absent such information, the Board hereinafter renders its opinion as
required by GPO Instruction 110.12 dated September 17, 1984.
Appellant has provided no substantial or compelling evidence or arguments to support is bald
allegation that the original camera ready copy was of such a poor quality that the required
product could not be obtained without extraordinary measures, or that with respect to the second
revision, that the Contracting Officer in reviewing the product acted capriciously. Indeed, the
reprocured product which was submitted to this Board stands out in marked contrast to both the
first and second products submitted by the contractor and is letter perfect respecting its
compliance with the very same camera copy. Moreover, Appellant's November 15, 1984, letter
contains elements admitting of some fault although offering unsubstantiated claims of
contributory fault on the part of Respondent. Appellant's letter of March 18, 1985, while
nonspecific as to this case, alludes to an admission of generally poor performance. This Board
believes that given the record before it, no further discussion of this issue is necessary to
support the conclusion that the appeal is without merit. This Board, absent a showing that the
Contracting Officer's decision was arbitrary and capricious in such judgmental matters as this,
wherein the contract and the Print Order itself gave the sole right of review to the Respondent,
has no authority to substitute its judgment for that of the Contracting Officer.
Accordingly, this Board affirms his decision.