Diversified Maintenance Systems, Inc. (B-423054.4)

You should not care.

Categories: Cancellation, WOSB

Date: 19 November 2025

URL: https://www.gao.gov/products/b-423054.4

Diversified Maintenance Systems protests the Navy's cancellation of an RFP for construction services at Naval Base Ventura County. DMS argues the cancellation was pretextual, designed to avoid awarding DMS the contract and litigating a pending protest. The solicitation, issued in November 2022 as a women-owned small business set-aside for a JOC, had been through two rounds of award to a competitor (MGS), two DMS protests, and one round of corrective action before the Navy decided to cancel.

The Navy explained that its requirements had materially changed: 126 contracting actions totaling $17.7 million had been awarded under other contracts, satisfying requirements originally planned for this JOC. Agency workforce realignment, a hiring freeze, and deferred resignation programs had reshaped contract administration capacity. Remaining requirements were larger and more complex than the general construction JOC was designed to handle. GAO found these reasons sufficient.

DMS argued the JOC remained viable because the Navy continued issuing task orders under other JOCs. GAO held that a protester's disagreement with the agency's assessment of its own needs does not establish the cancellation was unreasonable. Even assuming pretext supplied part of the motivation, the reasonableness standard does not change when the agency demonstrates a legitimate basis.

The protest is denied.

Digest

Protest of an agency's cancellation of a solicitation is denied where the record demonstrates that the agency had a reasonable basis to cancel the solicitation.