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The U.S. Government Accountability Office has denied a protest from Mistral Inc. challenging a $990 million sole-source U.S. Army contract awarded to AeroVironment Inc. for loitering munitions, finding the Army properly invoked temporary authority provided by the 2023 and 2024 National Defense Authorization Acts (NDAAs) to bypass competition.

In a decision issued Dec. 13 and released Monday, the GAO concluded that the Army's justification for using the public interest exception to full and open competition adhered to statutory and regulatory requirements.

"We find the Army's [determination and findings, or] D&F sufficiently demonstrates that the Army's use of the public interest exception to full and open competition was in accordance with the prescribing statute and regulations," the GAO said.

The LASSO (Low Altitude Stalking and Strike Ordnance) contract, awarded in August 2024, is part of the Army's efforts to support Ukraine, Taiwan, and Israel by replenishing defense stocks under temporary authority. The deal was aligned with the Department of Defense’s broader Replicator program, which aims to deploy thousands of low-cost, expendable autonomous systems by 2025.

Sole-Source Justification
The GAO determined that the loitering munitions contract qualified as a "covered contract" under NDAA provisions, which allow noncompetitive awards for critical munitions and related support for Ukraine, Taiwan, and Israel, or for allied stock replenishment.

The Army’s D&F documents established that the contract would provide essential defense articles, including anti-tank weapons and unmanned aerial vehicles, under the Foreign Military Sales program. While Mistral argued the Army lacked specificity about foreign sales destinations and quantities, the GAO found the omission justified by operational security concerns.

Mistral also argued the five-year contract was too long given the temporary nature of the authority. However, the GAO noted that Congress allowed for "flexible acquisition procedures" and placed no restrictions on contract size or performance period under the NDAA provisions.

Industry Reaction
AeroVironment, based in Simi Valley, California, praised the GAO's decision, saying it affirms the Army's procurement integrity and commitment to operational needs. Representatives for Mistral and the Army did not immediately respond to requests for comment.

Counsel and Case Details

• Mistral Inc. is represented by R. Locke Bell, Caitlin A. Crujido, and Markus G. Speidel of Morrison Foerster LLP.
• The Army is represented by Debra J. Talley and Adam G. Caudle of Army Materiel Command.
• AeroVironment Inc., as an intervenor, is represented by Kara L. Daniels and Roee Talmor of Arnold & Porter Kaye Scholer LLP.

The case is Matter of: Mistral Inc., file numbers B-422905 and B-422905.2, before the U.S. Government Accountability Office.