Here's a recent case where the Navy awarded a contract to a company whose proposal was technically unacceptable. An appeal by a losing offeror was sustained by the GAO (Government Accountability Office).
The Navy issued a solicitation for field engineering services in support air control tracking systems at various Fleet Area Control and Surveillance Facilities (FACSFACs). The solicitation identified the labor category of Engineering Technician VI as key personnel for whom offerors were to submit resumes demonstrating the person's experience and specialized qualifications. The solicitation also specified minimum educational and experience requirements for these key personnel including an associate degree in electronics or engineering technology and 16 years of practical experience in electronics or engineering technology. Within that 16 years of experience, there were sub-requirements for specialized experience. The solicitation also allowed offerors to substitute the associate degree with two additional years of experience.
The Navy awarded the contract to Honeywell. Another offeror appealed arguing that five of the eight engineering technician VIs proposed by Honeywell did not meet the minimum experience requirements of the solicitation. The Comptroller General (CG) looked into the matter and found that the experience of the Honeywell technicians did not meet the minimum requirements specified in the solicitation despite the fact that the Navy argued that these employees were highly qualified for the tasks. The CG noted that the key personnel qualification requirements may have been excessive for the work required.
The CG recommended that the Navy re-examine the key personnel qualification requirements established in the RFP to determine whether they accurately reflect the agency's needs. If so, the Navy should reject Honeywell's proposal as unacceptable under the specific terms of the solicitation and make a new source selection consistent with the solicitation. If, on the other hand, the Navy determines that the specifications overstate (or otherwise fail to reflect) the agency's actual minimum requirements, the Navy should amend the solicitation requirements and re-open the bidding process.
You can read the entire Comptroller General decision here.