Georgia Tech Procurement Assistance Center

Subcontractor who failed to follow the FAR finds that ‘fair’ and ‘just’ are not synonymous

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Inscribed over the doors of the U.S. Supreme Court are the words “Equal Justice Under Law.” It’s a reminder that judicial decisions should be just. That doesn’t necessarily mean fair.

In Aspic Engineering and Construction Company v. ECC Centcom Constructors, LLC, U.S. Court of Appeals for the 9th Circuit, Case No. 17-16510 (January 28, 2019), the 9th Circuit overturned an arbitration decision in favor of a local Afghani subcontractor seeking termination costs after it was terminated for convenience by a U.S.-based general contractor.  This, despite the arbitrator’s finding that the subcontract was “clearly drafted to give every advantage to” the general contractor, that the local Afghani subcontractor’s “experience with government contracting [was] not nearly as extensive as that of” the general contractor, and “that the normal business practices and customs of subcontractors in Afghanistan were more ‘primitive’ than those of U.S. subcontractors experienced with U.S. Government work.”

Background

Local Afghani subcontractor Aspic Engineering and Construction Company was awarded two subcontracts by ECC Centcom Constructors, the general contractor, on two projects in Afghanistan overseen by the United States Army Corps of Engineers. The first subcontract involved construction of various buildings in the Badghis province of Afghanistan.  The second subcontract involved the construction various buildings Sheberghan province of Afghanistan.  Both subcontracts included clauses from the Federal Acquisition Regulation (FAR), which were incorporated by reference, and included flow-down provisions obligating Aspic to ECC in the same manner that ECC was obligated to the U.S. government.

Keep reading this article at: https://www.jdsupra.com/legalnews/federal-subcontractor-who-failed-to-43185/

Formal claim required to appeal negative performance evaluation

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For federal contractors, it is not an exaggeration to say that performance evaluations are the lifeblood of the business.

A less-than-satisfactory evaluation in the Contractor Performance Assessment Reporting System (CPARS) affects far more than just the agency’s assessment of performance on a particular project.  A negative evaluation follows a contractor around – impacting the ability to obtain future contracts due to the specter negative past performance ratings.

The good news for contractors is that the ability to challenge and – if successful – reverse negative CPARS evaluations is a quickly developing area of government contracting law.

The first step in any successful CPARS challenge involves meaningful participation in the evaluation process.  The Federal Acquisition Regulation (FAR) Part 42.15 entitles contractors to submit comments and receive an agency review of a disputed performance evaluation.  Specifically, contractors are entitled to submit comments, rebuttal statements, and/or other information in response to the agency’s evaluation.  The agency must then review those comments at a level above the contracting officer and update the evaluation, if necessary.

Keep reading this article at: https://governmentcontracts.foxrothschild.com/2017/09/articles/contract-claims/cpars-challenge-primer-formal-claim-required-to-appeal-negative-performance-evaluation/

Bad-faith federal litigation tactics compel court to award small business attorneys’ fees

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Even though the federal government maintains an entire agency whose mission is purportedly to assist small businesses — the Small Business Administration (SBA) — regulators seem ever oblivious to their impact on entrepreneurs. The National Labor Relations Board’s (NLRB) effort to redefine who is an “employer” and the NLRB’s and the Department of Labor’s (DOL) enmity toward independent contracting are two current examples. A third is DOL’s so-called Fiduciary Rule, which hits sole-practitioner and small-business investment and insurance advisors especially hard.

Small businesses are also at a particular disadvantage when disputes with the government end up in court. A recent U.S. Court of Federal Claims decision, SUFI Network Services, Inc. v. US, exhibits government’s unfortunate willingness to exploit its power in disputes with a small business and the role courts can play in protecting entrepreneurs’ rights.

SUFI contracted with the U.S. Air Force (USAF) in 1996 to be the exclusive long-distance-call service provider for the guest lodging facilities on Air Force bases in Germany. Over the next 8 years, USAF personnel made it impossible for SUFI to successfully offer services.

For example, calling cards were provided to guests to circumvent SUFI’s service. Also, requests by SUFI that government phones be removed from the facilities were repeatedly ignored. SUFI declared that the USAF had committed a material breach of the contract and ceased services in August 2004. As required by the contract, SUFI filed a claim with its contracting officer for $130 million in damages. The officer awarded $133,000.

Obviously dissatisfied, SUFI appealed to the Armed Services Board of Contract Appeals (hereinafter, Board), increasing its request to $163 million.

Keep reading this article at: http://www.forbes.com/sites/wlf/2016/11/25/bad-faith-federal-litigation-tactics-compel-court-to-award-small-business-attorneys-fees/#14f0203f1f35

Appeals court says extension constitutes new contract for considering bid protest

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Award Term ExtensionsOn July 12, 2016, in Coast Professional, Inc. et. al v. United States, No. 2015-5077 (Fed. Cir. July 12, 2016), the U.S. Court of Appeals for the Federal Circuit overturned a Court of Federal Claims (“CoFC”) decision, finding that the CoFC erred in ruling that it did not have bid protest jurisdiction over the award of task orders characterized as “award-term extensions.”

The Federal Circuit’s decision provides clarity on the scope of Tucker Act’s bid protest jurisdiction, and provides a strong defense against Government arguments that attempt to limit that jurisdiction going forward.

The dispute in Coast Professional focused on “award term extensions” to task orders issued through the Federal Supply Schedule (“FSS”).

In 2008, the Department of Education (“DOE”) issued a Request for Quotations (RFQ) for services related to the collection of defaulted student loans. The RFQ stated that the Task Order would include a base term ending March 31, 2011, with additional option periods up to 24 months.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2016/07/federal-circuit-confirms-that-a-task-order-award-term-extension-constitutes-a-new-contract-for-purposes-of-bid-protest-jurisdiction/

Supreme Court unanimously rules in favor of VOSBs in case involving the VA’s use of GSA Schedule contracts

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Supreme CourtToday – June 16, 2016 – the U.S. Supreme Court ruled in favor of the interests of Veteran-Owned Small Businesses (VOSBs) and Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) who challenged the practice of the Veterans Administration (VA) to not apply the veteran business preference to orders placed against GSA Schedule contracts.

According to government contract legal expert Steven Koprince, “The Supreme Court’s decision in Kingdomware Technologies, Inc. v. United States, No. 14-916 (2016) means that the VA will be required to truly put ‘Veterans First’ in all of its procurement actions – which is what Kingdomware, and many veterans’ advocates, have fought for all along.”

The issues involved in the Kingdomware case date back to 2006 when Congress first required the VA to restrict contract competitions to veteran-owned small businesses as long as there were at least two qualified VOSBs available to perform the work.  This is known as the “Rule of Two.”  In practice, the VA determined that this rule did not apply to orders the agency placed through GSA Schedules.  The Government Accountability Office (GAO) decided that the VA’s practices violated the law, but the VA refused to make any changes in its GSA Schedule purchasing.  Finally, in 2011, a SDVOSB company by the name of Kingdomware Technologies took the VA to court, but the U.S. Court of Federal Claims ruled against the GAO and in the VA’s favor.  Kingdomware appealed, but lost at the U.S. Court of Appeals in 2014.  One year ago, the U.S. Supreme Court agreed to hear Kingdomware’s case.

It’s been a long path to travel, but VOSBs and SDVOSBs can celebrate the unanimous decision handed down by the Supreme Court on June 16th.  The Court’s directive to the VA is clear – the written decision states that the Rule of Two “is mandatory, not discretionary.”  The Court goes on to state that the law in this case “unambiguously requires the Department [the VA] to use the ‘Rule of Two’ before applying other procedures.”

Koprince sums up the impact of the Supreme Court’s decision this way: “I expect that the Kingdomware decision will prove a major boon to SDVOSBs and VOSBs, ultimately resulting in billions of extra dollars flowing to veteran-owned companies.  The long battle is over – and SDVOSBs and VOSBs have won.”

Read the text of the Supreme Court decision here: http://www.supremecourt.gov/opinions/15pdf/14-916_6j37.pdf

Read Steven Koprince’s detailed analysis of the decision here: http://smallgovcon.com/service-disabled-veteran-owned-small-businesses/victory-sdvosbs-win-in-kingdomware-supreme-court-decision/

Read earlier articles about this case here:

Live reports, tweets, and webinar offered on VA’s Kingdomware Supreme Court case

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On Feb. 22, 2016, the U.S. Supreme Court will be hearing oral arguments in a controversy that deals with whether federal agencies are doing enough to assure that their contracts go to businesses run by veterans, especially service-disabled veterans.

You’ll be able to access live reports, a Twitter feed, and even a free webinar on the Court’s hearing.  More about that in a moment, but first some background and information on why this case is so significant.

Background

The case dates back to November 27, 2012, when the U.S. Court of Federal Claims ruled that the Department of Veterans Affairs (VA) has discretion to procure goods and services from GSA’s Federal Supply Schedule (FSS or simply GSA Schedule) without first considering a set-aside acquisition for service-disabled veteran-owned small businesses (SDVOSBs) or veteran-owned small businesses (VOSBs).

The Court of Federal Claims ruling represented a departure from several U.S. Government Accountability Office (GAO) decisions that stated the VA should comply with the Veterans Benefits, Health Care, and Information Technology Act of 2006 before conducting a GSA Schedule buy.  The 2006 Act created the so-called “Veterans First” contracting program that gives priority to SDVOSBs and VOSBs in the VA’s acquisitions.  Despite GAO’s opinions, the VA instructed its contracting officers to not apply the “Veterans First” principles to GSA Schedule contracting.

A Winding Road to the Supreme Court

The company bringing the challenge, Kingdomware Technologies, Inc., appealed the decision by the Court of Federal Claims.  But the U.S. Court of Appeals for the Federal Circuit held that the purpose of the “Veterans First” rule is to ensure that the VA meets its SDVOSB goals, and that so long as the VA meets its SDVOSB goals, it is free to procure services and supplies from the Federal Supply Schedule without first considering a SDVOSB procurement.  This lead the Kingdomware firm to take its plea to the Supreme Court.

The U.S. Department of Justice urged the Supreme Court to deny review, contending that the Federal Circuit got it right.  The Supreme Court nevertheless granted review.

Then the VA surprised everybody.  It abandoned the argument that the statutory preference for veteran-owned companies applies only if the VA has not met its SDVOSB or VOSB contracting goals.  That position had proven to be successful in its arguments before both the Court of Federal Claims and the Federal Circuit.  The government’s new argument was that the statute’s use of the term “contract” excludes orders under the Federal Supply Schedule or other multiple award vehicles.  This new strategy by government lawyers puzzled Court watchers and federal contracting experts alike.

The mystery of how this case would turn out got more murky.  On Nov. 4, 2015 — just five days before the Supreme Court was scheduled to hear oral arguments in the Kingdomware case — the Court yanked the case from its docket.  The Court directed the parties, not later than Nov. 30, to submit briefs on whether the contracts in question had been fully performed, and if so, whether full performance renders the case moot.

Need another curious twist?   While attorneys for Kingdomware worried that the VA would most certainly take the position that the case is moot, the brief filed by the government took the position that the case is not moot.

In response to the briefs, the Supreme Court announced, just before Christmas, that the Court would hear oral arguments in Kingdomware Technologies v. United States on February 22, 2016.

Anxious To Learn about the Arguments Made to Supreme Court?

Everyone who’s interested is small business set-asides, in general, and to extent to which the VA must prioritize veteran-owned firms in its contracting, specifically, wants to know about the arguments being made to the Supreme Court in this case.

The good news is you have the opportunity to learn about the Kingdomware case almost as if you are in the courtroom.  Attorney Steven Koprince — who has been active in supporting Procurement Technical Assistance Centers (PTACs like the Georgia Tech Procurement Assistance Center) across the country, as well as the Association of Procurement Technical Assistance Centers (APTAC) — will be attending the hearing and reporting back on what happens.  He will be:

  • Posting his impressions on his blog, SmallGovCon, the afternoon of Monday, Feb. 22.  You can check SmallGovCon.com that day or let him know if you would like him to email the post directly to you.
  • Answering your questions posted on Twitter starting at 10:00 a.m. EST on Tuesday, Feb. 23, for a full hour. You can follow Steven on Twitter @stevenkoprince or use the hashtag #Koprince4Vets.
  • Offering a free webinar to those who are interested in hearing what he learns at the oral arguments.  Steven’s webinar will take place at 12 noon EST on Tuesday, Feb. 23.  You can register for it here.

Kingdomware Koprince

Federal Circuit’s Metcalf decision a big win for contractors

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In a recent decision, the U.S. Court of Appeals for the Federal Circuit (“CAFC”) the supervising court for the Court of Federal Claims and the Boards of Contract Appeals, among others) clarified important legal principles concerning the federal government’s duty of good faith and fair dealing and its responsibility for differing site conditions. Metcalf Construction Company, Inc. v. United States controls disputes with the federal government and also provides authority and rationale useful to contractors in disputes with any project owner, public or private.

In October 2002, Metcalf Construction, a small business based in Hawaii, was awarded a $48 million contract to design and build 212 housing units for the U.S. Navy on a Marine Corps base in Hawaii. Saying the project did not go smoothly is an understatement. Metcalf’s performance was hindered and delayed by unanticipated soil conditions and other issues made worse by the Navy’s failure to administer the contract fairly and according to its terms. By the time the Navy finally accepted the project as complete in March 2007, almost two full years after the original completion date, Metcalf had incurred costs in excess of $76 million — leaving the contractor with losses of approximately $27 million.

Keep reading this article at: http://www.mondaq.com/unitedstates/x/311802/Building+Construction/Federal+Circuits+Metcalf+Decision+a+Big+Win+for+Contractors&email_access=on

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