I posted this in the contract administration forum but had no response so I am trying here-
I haven't seen this exact question before so here goes....I would for a contractor with GSA schedules and other government contracts. We are a wholly owned subsidiary of Parent, and Parent is owned by a holding company. Immediate parent has two divisions - we'll call them finance and nonsense. There is an effort to combine sales, marketing and delivery efforts of the finance division with my subsidiary because we do similar work, but there is no plan to legally change the structure. We will remain a wholly owned sub. Finance will remain a division - not a subsidiary - of our immediate parent.
My questions are as follows: If we market and sell together under a "doing business as" name with no legal change to our corporate structure, do we run the risk of violating the price reduction clause of the false claims act? Suppose we have delivery people who go back and forth between the wholly owned sub and the division, but bill at different rates on different projects. Can a person in the division bill a division client at a rate less than the GSA rate? Does it depend on what their skillset, education and other labor category qualifications are? How similar does the work have to be to trigger the PRC? How similar does the division client need to be to sub's basis of award to trigger the PRC? In short ...can this allow the government to
"pierce the corporate veil" and start looking at the books of the parent company when they are trying to determine a BOA or find a PRC violation?
I read this on another thread relating to a similar situation: >>This is where GSA and the DOJ have a field day with the False Claims Act. If you withhold disclosure of a customer or group of customers that would have revealed a different BOA, then you can open yourself up to a FCA violation. Also, if you sell to a non-BOA and the price is lower than to your BOA and you did not disclose that information, you could be considered in violation of the FCA because the logic used is that if you had disclosed this other customer or category of customers, they would have been the BOA and not the one declared. << Is this something we need to worry about in the situation I described?