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I'm chasing my tail and need some help. The General Rule appears to be that if a protester knows a firm has a conflict of interest, then the protester must wait and see who wins before it can file a protest for OCI. Apparently to protest before award is considered premature.

Here is my fact scenario. Let's say the protester, the incumbent, knew that all competitors had an equal chance of winning an award. The protester also knew that one of the competitors, X had a government employee on its proposal team, and for purposes of this wifcon discussion, we'll say this team member absolutely knew the protester's pricing, labor rates, etc. (We'll all agree tremendous prejudice here and definitely an unfair competitive playing field). However, our protester waited until award to spring a protest against this competitor X who won the award.

The protester used the OCI unfair competitive advantage argument when filing its protest. Why would GAO based on prior rulings consider a scenario like this timely? GAO seems to think that this impaired objectivity OCI only became viable when the agency actually selected X for award. GAO seems to regularly hold that "an alleged OCI is typically premature when raised BEFORE the protester is notified of the agency's selection decision."

Don't we want the Contracting Officer to have this issue brought to its attention as soon as practicable so it can be addressed BEFORE award? The protester believed X one of its competitors had an impaired objectivity OCI. The protester knew let's say from the very beginning of the bid process this information and then just sat on it waiting. Once award was made bam, protest! I would submit the protester is obligated to disclose this information to the Contractor before the closing of proposals (or 10 days thereafter) so it could be properly addressed, and if the protester doesn't then any protest filed after this period of time would be untimely. Any thoughts?

Cheers!

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Sorry about the computer acting up......

Okay, let's try this fact pattern without the "let's say"...The evidence supports the protester's position that X's firm had access to protester's sensitive company information. The protester knew from the beginning of the solicitation period that X's firm had this access and knowledge of its sensitive information. That a former government employee who worked for X had access to protester's information while a government employee and was a member of X's proposal team. That the government employee quit his government job two years earlier and joined X's firm. That X firm won the award. Upon hearing of this award, the protester immediately filed its protest claiming X had an OCI that should disqualify it from award. The protester, despite knowing that a former government employee had access to its sensitive information never brought this matter to the SSA's attention. Based on these facts why would GAO deem this protest to be timely? Why doesn't the protester have a duty to disclose this OCI issue to the SSA during the solicitation period so that 1) the OCI can be investigated/vetted and 2) if substantiated, the SSA would disqualify the firm from participating in the process. Why do we allow the protester the ability to wait until award to complain about this OCI that it knew about from the beginning?

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Sorry about the computer acting up......

Okay, let's try this fact pattern without the "let's say"...The evidence supports the protester's position that X's firm had access to protester's sensitive company information. The protester knew from the beginning of the solicitation period that X's firm had this access and knowledge of its sensitive information. That a former government employee who worked for X had access to protester's information while a government employee and was a member of X's proposal team. That the government employee quit his government job two years earlier and joined X's firm. That X firm won the award. Upon hearing of this award, the protester immediately filed its protest claiming X had an OCI that should disqualify it from award. The protester, despite knowing that a former government employee had access to its sensitive information never brought this matter to the SSA's attention. Based on these facts why would GAO deem this protest to be timely? Why doesn't the protester have a duty to disclose this OCI issue to the SSA during the solicitation period so that 1) the OCI can be investigated/vetted and 2) if substantiated, the SSA would disqualify the firm from participating in the process. Why do we allow the protester the ability to wait until award to complain about this OCI that it knew about from the beginning?

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Guest Vern Edwards

See the GAO's bid protest regulations, 4 CFR Sect. 21.1(a):

An interested party may protest a solicitation or other request by a Federal agency for offers for a contract for the procurement of property or services; the cancellation of such a solicitation or other request; an award or proposed award of such a contract; and a termination of such a contract, if the protest alleges that the termination was based on improprieties in the award of the contract.

See also FAR 33.101:

Protest means a written objection by an interested party to any of the following:

(1) A solicitation or other request by an agency for offers for a contract for the procurement of property or services.

(2) The cancellation of the solicitation or other request.

(3) An award or proposed award of the contract.

(4) A termination or cancellation of an award of the contract, if the written objection contains an allegation that the termination or cancellation is based in whole or in part on improprieties concerning the award of the contract.

Now, into which of those does submission of a proposal by an offeror with an OCI fall? Answer: None.

An interested party can protest something that the government has done or has not done. The law provides no basis for protesting something that a prospective or actual offeror may or may not have done before that offeror is selected for award. Nothing requires an interested party to notify a CO of a prospective OCI before the firm with the OCI has been selected for award.

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In addition to Vern's points, why should the protester go through the non-reimburseable expense of filing a protest against something that is merely speculative, i.e., the award of a contract to X? It is only after X receives the award that the protester has suffered a potential injury. One issue you have overlooked in this is the possibility that X may have violated the Procurement Integrity Act. If that is the case, the protester would have had to have brought the matter to the attention of the agency IG before filing a protest with GAO.

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Morning Retreadfed,

I did not overlook the procurement integrity provisions. In GAO's Health Net Federal Services, LLC, B-401652.3;B-401652.5, November 4, 2009, it warns you not to confuse the two issues---procurement integrity and unfair competitive advantage. My facts are clearly predicated on an unfair competitive advantage stemming from the former government employee's inside knowledge of the protester's pricing information, etc. facts which do not necessarily turn on prohibited behavior under the procurement integrity rules.

I also don't understand why you say there would be an expense associated with the protester turning over this unfair advantage allegation to the contracting officer prior to award. The protester had all the facts/knowledge of this unfair advantage by X, why not share what you know with the contracting officer prior to award? Instead, the protester waited for award and then had to spend money--not just on a postage stamp, but money to pay for a team of lawyers to bring this "OCI" issue to the contracting officer's attention via a protest. I find GAO's handling of OCI issues in this manner rather draconian. What happened to good faith dealings between all the parties? I believe GAO shouldn't be rewarding and encouraging this kind of behavior by allowing the offeror to file a timely protest. If an offeror suspects OCI misconduct is ongoing during the solicitation phase, it needs to bring the matter to agency official's attention for investigation. GAO seems to reward these individuals, despite how long they may have known about this information before filing their protest, by not ruling that protest as being untimely. Typically if the OCI is substantiated by the agency (in my fact pattern that the individual participated in the preparation of the proposal) the contract is terminated. The agency must now waste more time, resources, etc to select an new awardee....not necessarily the protester either...need to conduct another best value/trade off.

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I am more concerned about the facet of your scenario that has a government employee on the offeror's proposal team. You did not say it was a "former" government employee. I hope your scenario is not based on a real situation. It seems very unlikely to me that a Fed would have permission for outside employment with an organization that competes for government contracts, especially if that FED is in a position that gives him or her privy to proposals submitted in response to solicitations. Where's the GAO when you need them!

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Guest Vern Edwards

The protester had all the facts/knowledge of this unfair advantage by X, why not share what you know with the contracting officer prior to award?

There are two issues here. First, did the protester behave unethically by not going to the CO about a possible OCI? Second, should the GAO have declared the protest untimely in light of the fact that protester knew some things that might have affected the source selection decision before it was made?

I cannot speak to the question of ethics, but think of it from the standpoint of competitive tactics. Why should the protester have put you on notice -- so you could ensure that their competitor eliminates an obstacle to their selection? Really? Please. The incumbent's goal is to win the contract, not to prevent OCIs. If you had selected the incumbent, then they would have had no issue. Since you gave the award to their competitor, they have a chance to prevent or delay award or performance, and they may even get another chance to win. You might not like that, and I understand why you don't. But, and forgive me for putting it this way, who cares what you don't like? It's business, not personal. (I think.)

I believe GAO shouldn't be rewarding and encouraging this kind of behavior by allowing the offeror to file a timely protest.

Okay. We can get that you are upset,. but you don't seem to understand the law. The GAO is not rewarding or encouraging anything. The GAO's timeliness rules reflect the limited scope of the GAO's protest authority as set forth in statute, 31 U.S.C. Sec. 3551 et seq. It cannot declare a protest untimely because an interested party did not take action to prevent the basis for its protest before it happened. The protester in this case was not required by law to intervene and had no legal basis for filing a protest before the government selected its competitor. Interested parties can protest a violation of the law. They cannot protest to prevent a violation of the law, and they cannot be punished for failing intervene to prevent the thing that they are protesting. Get it?

But I understand your desire to rant. I've done it myself. So go ahead and get it out of your system. Make the same point as many times as you like.

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Correct. In my fact pattern he was a former government employee now a contractor working for X. None of the trip wires for a procurement integrity issue are implicated in my fact pattern. Instead, the individual while working for the federal government had access to the incumbent's pricing information, labor rates, list of employees, etc..etc...The incumbent knew the former government employee had access to the firm's information. The incumbent waited to ssee who would win and when it was X's firm, filed its protest, waiving the gotcha OCI flag. My bone of contention is that the protester could have raised the issue preaward and failed to do so. GAO in my opinion should therefore rule that the OCI argument has been waived. I can't find a case supporting my belief. One would hope that contractors might think that a greater risk exists by sitting on an OCI concern.

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Vern,

Unfortunately my fact pattern above strays tremendously from the reality of life that I must actually address on a daily basis when it comes to dealing with OCI issues. I do understand the law very clearly. I'm tired of reading GAO cases on this topic. Typically what I have been seeing in practice is when an incumbent loses an award the incumbent will grab onto any protestable excuse--usually it is the OCI flag that pops up more often than not. It seems, at least to me, that the incumbent is just trying to buy themselves more time and will use any protest excuse they can find in their bag of tricks. Extra time equates to more money for their firm. Typically, I've been finding that these OCI allegations raised for the first time in a protest are generally pretty speculative once a full investigation is launched. This really doesn't upset me. I just find it wasteful and nonproductive. I guess I'm the only one who feels this way. My pitch is if you got something you think is wrong that is going on pre-award you've got to tell me so I as a Contracting Officer can properly address it. If I fail to do so to your satisfaction then protest after I have taken corrective action.

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Guest Vern Edwards
Typically what I have been seeing in practice is when an incumbent loses an award the incumbent will grab onto any protestable excuse--usually it is the OCI flag that pops up more often than not. It seems, at least to me, that the incumbent is just trying to buy themselves more time and will use any protest excuse they can find in their bag of tricks. Extra time equates to more money for their firm.

Bingo.

I just find it wasteful and nonproductive. I guess I'm the only one who feels this way.

You're not alone in feeling that way.

My pitch is if you got something you think is wrong that is going on pre-award you've got to tell me so I as a Contracting Officer can properly address it. If I fail to do so to your satisfaction then protest after I have taken corrective action.

Okay, now you're being idealistic and naive. Your statement assumes the every competitor wants a well-run competition. The problem is that by "well run" what every competitor means is "a competition that I win."

Once you're past being upset, think of this as window into the truly fascinating world of competitive strategy and tactics. Seriously. You can't change any of what is upsetting you. You can deal with it, but more, you can study it. There is a huge literature about all of this. A lot of it is dry in the way that only academics can make it, but a lot of it is fascinating and kind of fun. The people who make the rules for competitions cannot foresee all of the ways in which the game can be played. It's not just industry that does it. The government does it, too. Any rule system can be gamed to advantage. Read this http://en.wikipedia.org/wiki/Gaming_the_system and go from there. It'll be fun. There's a book in it somewhere.

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In a FAR Part 15 acquisition, the Government generally does not share or acknowledge the number of offerors or identity of other offerors -- so really, an incumbent/unsuccessful offeror/protester doesn't have real knowledge the successful offeror was even an offeror until AFTER the pre- or post-award notification to unsuccessful offerors.

If an aggrieved party wants an injunction to stop the Government from doing something in the future, well, that's called an injunction and one normally would get those from a court. A protest at the Court of Federal Claims can, and sometimes does, result in an injunction. The GAO does not have injunction authority.

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Ji20874 what you say is true, but again in the real world everybody knows everybody's business when it comes to government contracting, especially when JV teaming is in the works. Everybody is running around trying to find a sub to pair up with. Eventually word gets out and most of the players and their subs are known to all despite FAR part 15. Interestingly, it seems that COFC treats OCI issues a bit differently than does GAO.

Thanks Vern! I'm done venting or ranting as you say. Maybe one day those who make the rules might grow weary of this strategy that is constantly being used to game the system and change the rules--that would be sweet.

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First, it is not always true that everybody knows everybody's business when it comes to government contracting. It depends on the arena you are working in. I've worked many procurements where contractors did not know who their competition was. So, I agree with ji20874 on that point.

Second, if the rules for a timely protest on OCI were changed, and contractors were required to notify the CO when they thought there might be a competitor who might have an OCI with a particular procurement or else they couldn't protest an award about an OCI, it is easy for me to imagine how contractors could manipulate the situation and spin our COs wheels on fruitless speculative (or downright false) accusations.

I like the rules the way they are.

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Once you're past being upset, think of this as window into the truly fascinating world of competitive strategy and tactics. Seriously. You can't change any of what is upsetting you. You can deal with it, but more, you can study it. There is a huge literature about all of this. A lot of it is dry in the way that only academics can make it, but a lot of it is fascinating and kind of fun. The people who make the rules for competitions cannot foresee all of the ways in which the game can be played. It's not just industry that does it. The government does it, too. Any rule system can be gamed to advantage. Read this http://en.wikipedia....ming_the_system and go from there. It'll be fun. There's a book in it somewhere.

The "strategery" is fun. More to the point, as long as government and the competition game the system, everybody has to. In the scenario discussed, if the ex-government employee is on the incumbent's proposal team and the government would like to retain the incumbent, the consequences of notification and "cure" might change everyone's position dramatically. In my experience, in my industry, it's not worth the expense and disruption of protest just to keep a contract running a few more months, profit margins are too slender. But only a fool would throw away the option.

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Let's have some more fun here with my facts. I'm prepared to argue there is no OCI here. In our fact pattern above, we agreed that X's firm had access to protester's sensitive company information because it hired a former government employee. Our fact pattern above suggests that this former government employee obtained through his/her duties access to protester's information while a government employee. This individual immediately upon quitting his/her government job joined X's proposal team. They of course won the award. Upon hearing of this award, the protester immediately filed its protest claiming X had an OCI that should disqualify it from award arguing FAR 9.505-4(a). Claiming X had an unfair competitive advantage. I would submit there is no OCI here. Some thoughts to consider and ponder before responding. Did the government employee participate directly in the preparation of the solicitation protested? We'll say NO. In fact it was exactly two years from the date he/she quit when the RFP was finally released. If 9.505-4(a) doesn't apply then what do we have here? I would suggest what you really have in the making is a potential PIA violation that requires more facts to substantiate whether or not the act was in fact violated. If you can't substantiate the PIA violation then the gaming goes on.

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