November 4, 2011
Spring Valley, CA – For some years now, the United States has been a nation scrambling to get back on its feet. Corporations have grown, then outsourced, and then angered Americans with their hefty bonuses. Congress has recognized the actions of these businesses, sought to punish them, and then vowed to support the small businessman. But somewhere between the words that have been broadcasted by the media and the businesses that have really needed help, the message has been lost.
Earlier this year, TV Ears, Inc., which manufactures the number one selling wireless television headset system in the country, lost a bid to supply assistive listening devices to hearing impaired veterans through the Department of Veterans Affairs (VA). Although the TV Ears product is made in the United States, the contract was awarded for a product made in China which will cost the VA $3 million more than the TV Ears bid. At a time when unemployment in this country is very high and money is tight, such an award by the VA would leave any American searching for answers.
The VA declined to award TV Ears the contract because it found its product to be unacceptable. The word “unacceptable” in this context means that the VA found that the TV Ears product had such major deficiencies that it would not be appropriate to issue the product to hearing impaired veterans. When George Dennis, Founder and CEO of TV Ears, reviewed the reasons given by the VA to support the loss of the bid by TV Ears, he was concerned. Rather than quantitative data, he found only a one sentence list of general, subjective statements that included poor sound quality, a narrow line of sight/static with head turns, a high frequency hum, and problems with lights on the device. When challenged by TV Ears about such a subjective decision, the VA initially took the position that such general descriptions were “specific details as to technical findings.” However, on September 30th, in a response to Dennis’ inquiry for further information, the VA changed its position and argued that a subjective evaluation was all that was needed because the regulations authorized such an evaluation to make the decision.
TV Ears’ Digital 95+, the product submitted by TV Ears, was the only “trade-compliant” product that was submitted by the 10 companies that bid – meaning that it was the only product made in America or in another country with preferred trading status. This meant that TV Ears would have been awarded the contract if its product had been found to be acceptable by the VA.
Dennis wanted a better understanding of why his country was outsourcing jobs to create products that his company was making in the United States. However, when he sought to communicate with the VA’s Contracting Officer, he was told that she “had been advised to terminate any and all conversations” with him. On the same day, the Procurement Analyst for the Office of Acquisition and Logistics notified Dennis that they “obtained a copy (his) correspondence dated June 2, 2011 through unofficial means,” possibly nullifying any opportunity to protest the results of the bid.
Dennis and the staff at TV Ears, Inc. were at a loss. They are a successful American company, with a U.S. made product enjoyed by over 2 million loyal customers, yet they were aggressively being denied a contract to supply their nation’s veterans with a high quality product at a better price than the product which was awarded the bid… What’s more, the quality of their product was being questioned and without substantial evidence. Since Dennis was not making progress with efforts to communicate with the VA, he decided to have TV Ears’ product tested by an independent acoustic measurements testing lab.
In a report dated October 11, 2011, Nevada Sound Research LLC (NSR) addressed all four claims that the VA reported as reasons that TV Ears did not win the VA bid. When sound quality was tested by NSR, it was reported that “overall sound quality is at best extraordinary, with no loss of consonants (Speech Intelligibility).” With regards to line of sight, test results showed that “both transmitter and headset receiver’s infrared signal (operating at 95 KHz) have extraordinarily wide angle distribution over a very large range.” The hum reported by the VA was regarded by NSR as “normal volume hiss (that occurs when) no program material is being played, and which disappears during normal use of the audio device.” Furthermore, stated NSR, “TV Ears does not display any unusual noise level at 60 Hz that would be audible during the use of the product by the consumer.” The final claim made by the VA that lights did not work on the device was also evaluated. NSR tested this claim as well and reported that “Results are all lights in all functions appear to operate throughout all modes and show no signs of malfunction.”
Dennis says he finds it upsetting that his product was classified as being “technically unacceptable” by the government’s subjective research when Nevada Sound Research’s objective lab results concluded that “the problems encountered by the Veterans Administration and stated in the denial of product acceptability (are) without merit” and that “the test results clearly demonstrate the product meets or exceeds all claims made by the manufacturer.” He also says that he finds it wasteful that the government hired several attorneys to work long hours to argue against his protest at the GAO. With regard to his protest letters not being received in a timely fashion, Dennis clarifies that it was not TV Ears that submitted his protest outside of the time constraints, but the office of his congressman, Duncan Hunter, who assured Dennis that they would forward his letter to the correct office.
So what’s going on here? If the government wants to support business for Americans by Americans, why didn’t they take the appropriate measures to test the products up for the bid? Why wouldn’t they communicate with the American businessman? Why was the bid awarded to a product made in China?
TV Ears appealed this matter to the Government Accountability Office (“GAO”). In its appeal, the Company made the arguments discussed above about the quality of the TV Ears product, the subjective nature of the VA’s decision, and the results of the testing by Nevada Sound Research. On November 21, 2011 the GAO advised the Company that its protest was being dismissed because it was not timely filed with the VA. This decision is a perfect illustration of the hollowness of the government’s statements about supporting US business because, as the VA itself acknowledged, the Company’s protest was addressed correctly and was received by the VA agency in time, but Congressman Duncan Hunter’s office faxed it to an individual other than the addressee within the VA. What this means is that a multi-million dollar government contract is being denied to a US company not because of the quality of its product, but because a US Congressman’s office faxed a letter on time and to the correct agency but not to the correct individual within the agency. If the government truly wanted to help US business, substance would have prevailed over form here because it is easy to see that the right thing to do was to uphold the Company’s protest and evaluate the Company’s product. But as this story clearly illustrates, at least two agencies of our government are universes unto themselves and really do not care about the consequences of its decisions on a US business, no matter what they say.