Veteran-owned small businesses scored a win at the Supreme Court with a unanimous ruling in Kingdomware Technologies, Inc. v. United States. The case involved a law that requires the Department of Veterans Affairs (the “VA” or the “Department”) to restrict competition to service-disabled or veteran-owned small businesses when a contracting officer determines that “at least two of these businesses will submit offers and that the award can be made at a fair and reasonable price that offers best value to the United States.” That requirement is known as the “Rule of Two.” In Kingdomware, the Court held that the Rule of Two covers orders under the Federal Supply Schedule (“FSS”), and that it continues to apply even after the Department has reached its statutorily mandated annual goal of contracting with service-disabled and veteran-owned small businesses.
Continue Reading Supreme Court Clarifies Broad Scope of the “Rule of Two” in VA Contracting
Hope for Offerors Who Win a Multiple-Award IDIQ Contract and Want to Protest an Improper Award to a Competitor
You just learned your company is one of several winners of a multiple-award IDIQ contract. You also learned one of your competitors, which should have been ineligible, is also an awardee. So, as things stand, you’ll have to split the contract — and compete for orders — with that competitor. Can you file a protest challenging the improper award to your competitor? Until last week, the answer was “no.” Now the answer is “maybe” — but only if you go to the Court of Federal Claims (“COFC”).
To pursue a protest, the protester must establish that it is an interested party, by showing that (1) it is an actual or prospective offeror; and (2) its direct economic interest would be affected by the award of, or failure to award, the contract in question. 31 U.S.C. § 3551(2)(A); 4 C.F.R. § 21.0(a)(1). Since its decision in Recon Optical, Inc., et al., B-272239, July 17, 1996, 96-2 CPD ¶ 21, GAO has consistently held that winners of multiple-award IDIQ contracts are not interested parties for purposes of a protest, but it has typically done so while implying that, in rare circumstances, an awardee might be able to show it has an economic interest sufficient to make it an interested party.
Continue Reading Hope for Offerors Who Win a Multiple-Award IDIQ Contract and Want to Protest an Improper Award to a Competitor
GAO Protest Sustain Rate on the Rise
Through the first 5 months of FY 2016, GAO is sustaining protests at a 22% clip — a far higher rate than in recent years.
GAO’s sustain rate considers only those protests that go to a decision on the merits, and reflects the percentage of those protests where GAO finds in favor of the protester. In recent years, GAO’s sustain rate has generally declined.
DoD To Reconsider How It Evaluates Proposed IR&D Projects In Awarding Government Contracts
The Department of Defense (DoD) is considering a proposed rule that would prevent defense contractors from promising future Independent Research & Development (IR&D) investments as a way to gain a competitive price advantage in DoD procurements. Although DoD’s rulemaking is in its early stages, defense contractors with substantial IR&D programs should monitor these developments closely, as DoD seems poised to frustrate yet another incentive for pursuing defense-related IR&D.
Continue Reading DoD To Reconsider How It Evaluates Proposed IR&D Projects In Awarding Government Contracts
GAO Sustains Organizational Conflict of Interest Protest Of Veterans Affairs Task Order
On February 11, 2016, the Government Accountability Office publicly released its recommendation sustaining the protest by ASM Research of a task order award by the Department of Veterans Affairs (VA) to Booz Allen Hamilton. GAO determined that the VA failed to adequately consider a potential organizational conflict of interest (OCI) of the awardee based on the awardee’s performance of related task orders under the same overall program. The ASM Research decision demonstrates that, even after the Federal Circuit’s decision in Turner Construction, GAO will sustain an OCI protest where the agency’s evaluation fails to consider key facts or is otherwise not meaningful.
The ASM Research protest concerned a task order award for Mobile Infrastructure Services (MIS) under the VA’s Transformational Twenty-One Total Technology contract program. Through the MIS Task Order, the VA sought to procure hosting and maintenance of infrastructure, platforms, and tools for development, testing, and production of mobile applications related to healthcare.
The Pitfalls of Changing a Pending Proposal
As acquisition timelines become increasingly protracted, contractors face the thorny question of if, when and how to advise a procuring agency of changes affecting an already submitted proposal. In a series of decisions, the Government Accountability Office has held that contractors must inform the procuring agency of any “material change” to a proposal that occurs
New Obligations to Disclose Labor Law Violations Could Expose Contractors to Defamation Liability
Company communications with government authorities about potential criminal activity or wrongdoing by the company’s employees may expose that company to liability for defamation; that is, unless those communications are considered privileged. In the majority of states, communications with police or prosecutors are afforded “qualified” or “conditional” privilege, and generally may be the basis of a defamation suit only if they are made with malice or are knowingly false. And several states have afforded absolute privilege or immunity to communications that are made in response to a government investigation that could lead to prosecution.
But importantly for contractors, potential defamation liability on the basis of statements to the government could arise outside the context of a government investigation. For example, the recent issuance of the Fair Pay Safe Workplaces Order (“FPSW Order” or “Order”), which requires contractors to disclose violations of number of labor laws, may have significant implications for contractors’ exposure to defamation suits.
Continue Reading New Obligations to Disclose Labor Law Violations Could Expose Contractors to Defamation Liability