A losing bidder for a US Army contract has taken the service to court, arguing that artificial intelligence tools used to score proposals got the facts wrong. Trax International filed a complaint at the US Court of Federal Claims in late July, asking the court to order a fresh evaluation of bids for mission support services at White Sands Missile Range in New Mexico, Defense One reported on 6 August.
The Army awarded the work to Southwest Range Services, whose bid was worth roughly $450m. Trax says the winning offer carried a $29.4m price premium, so removing a flawed weakness from its own score could have changed the result. The Army declined to comment on the litigation.
The AI allegation
Trax claims the evaluation relied on AI that invented content several times, making its proposal look weaker than its rival’s. It says the Army conceded that one weakness cited against Trax had no supporting documentation, and calls it a “classic AI hallucination” that no member of the evaluation board checked. Trax also says the records given to auditors did not show whether a person or an AI tool assigned the strengths credited to the winner.
The earlier protest
The case follows a defeat at the Government Accountability Office. In a decision dated 20 May, GAO denied Trax’s protest, which had argued that Southwest Range had an unmitigable conflict of interest because affiliates make systems tested at the range, according to the GovSpring litigation roundup. GAO found the Army’s conflict review reasonable and said one erroneous weakness in Trax’s continuity-of-operations plan was harmless because the decision-maker did not rely on it. TradeWar could not confirm whether that is the same weakness Trax now attributes to AI.
The Defense Department has said it used AI to help evaluate bids in several recent solicitations. GAO dismissed a similar allegation by Salient CRGT in January.
The case could be the first real test of how much of a source selection a machine may write before a human has to check it.
What to watch
- Whether the court orders the Army to disclose how AI was used in the evaluation.
- Any wider Pentagon guidance on AI in contract scoring.
- Whether performance of the Southwest Range contract is paused during the case.
