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The following is an installment in Crowell & Moring’s 2023 Bid Protest Sustain of the Month Series.  All through 2023, Crowell’s Government Contracts Practice will keep you up to date with a summary of the most notable bid protest sustain decision each month.  Below, Crowell Partner Cherie Owen discusses GAO’s decision in Mandex, Inc., involving organizational conflicts of interest (OCIs).

In Mandex, the Department of the Navy, Naval Information Warfare Systems Command, Naval Information Warfare Center (NIWC) sought to award a task order for Marine Air Ground Task Force Command and Control Systems and Applications (MC2SA) engineering support (“Engineering Support TO”).  The MC2SA integrated product team aims at delivering unique, timely, and effective solutions to the warfighter to enable situational awareness, enhance decision making, and increase lethality.  Under this procurement, the awardee will provide engineering support for MC2SA in a variety of functional areas, with primary services in software development, integration, test and evaluation, and cybersecurity.

After the solicitation for this procurement had been issued, but before it had been awarded, the Agency awarded another task order related to the MC2SA program – the MC2SA management support task order (“Management Support TO”) – to Imagine One.  The Management Support TO required Imagine One to provide programmatic and technical management support for MC2SA initiatives.  After Imagine One also won the MC2SA Engineering Support TO, Mandex protested, alleging that Imagine One’s performance of the Management Support TO created two types of impermissible OCIs with respect to the Engineering Support TO.  First, Mandex argued that the Management Support TO provided Imagine One with access to nonpublic competitively useful information, resulting in an unequal access to information OCI in the Engineering Support TO competition.  Second, Mandex argued that Imagine One’s work under the Management Support TO would entail evaluating its own work under the Engineering Support TO, and would result in Imagine One providing biased input to the government.

After the protest was filed, the contracting officer conducted an investigation into the OCI allegations.  With respect to the unequal access to information OCI allegations, the contracting officer concluded that, although the Management Support TO would provide access to nonpublic, competitively useful information, there was no OCI because Imagine One had not yet begun substantive work under the task order at the time that it submitted its Engineering Support proposal; rather, it had performed only transition type tasks at that point. 

With respect to the impaired objectivity OCI allegations, the contracting officer modified Imagine One’s Management Support TO performance work statement (PWS) to state that Imagine One was not permitted to evaluate its own performance (or its affiliates/subs) under the Engineering Support TO, nor could Imagine One recommend additional work, products, or services to be provided/acquired under the Engineering Support TO.  With these modifications, the contracting officer concluded that there was no potential for an impaired objectivity OCI.

GAO sustained the protest, concluding that the contracting officer’s conclusions with respect to both types of OCIs were unreasonable.  For the unequal access to information OCI, GAO noted that, while the contracting officer found that Imagine One performed only “transition tasks such as onboarding and credentialing its team members,” the contracting officer failed to consider whether Imagine One’s employees had access to nonpublic competitively useful information.  In addition, the contracting officer’s investigation relied on limited information and an incomplete investigation – for example, in assessing the types of work that Imagine One had performed under the Management Support TO, the contracting officer merely examined the timecards of employees, which did not reflect all of the employees’ tasks and did not indicate what types of information they had accessed.

For the impaired objectivity OCI, GAO first noted that the contracting officer’s analysis was improperly limited and failed to analyze the full spectrum of work that Imagine One would perform under the Management Support TO.  In addition, GAO found that, even with the contracting officer’s post-protest modifications to the scope of the PWS, “the plain terms of the MC2SA management support task order require Imagine One to advise the Navy on work in which it has a competing interest.”  As a result, the CO’s analysis of the impaired objectivity OCI was insufficient.

The Mandex decision serves as an important reminder that potential OCIs must be critically analyzed, even where the temporal overlap of two contracts may appear to be minimal.  Although GAO affords deference to agency determinations, this deference does not allow the government to overlook information relevant to the issues at hand. 

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Photo of Cherie Owen Cherie Owen

Government contractors of all sizes — from Fortune 10 companies to small businesses — trust Cherie Owen to represent and advise them on a wide range of government contract matters, including bid protests at the Government Accountability Office, the Court of Federal Claims…

Government contractors of all sizes — from Fortune 10 companies to small businesses — trust Cherie Owen to represent and advise them on a wide range of government contract matters, including bid protests at the Government Accountability Office, the Court of Federal Claims, federal procuring agencies, and state courts. Cherie draws on the unique insights she gained as a senior bid protest hearing officer during her 12-year tenure at the GAO to identify the legal arguments and practical strategies most likely to result in strategic wins for her clients.

Clients rely on Cherie to provide counseling regarding contract formation and negotiation with respect to procurement contracts, grants, cooperative agreements, and Other Transaction Agreements. She also advises government contractors on business and compliance matters, including subcontractor agreements, suspension and debarment, and ethics and conflicts rules and mitigation strategies. In doing so, Cherie takes a pragmatic approach to addressing her clients’ legal and business concerns, leveraging her experience as both a GAO bid protest hearing officer and a judge on the GAO Contract Appeals Board. During her time at the GAO, she resolved over 600 protests, issued over 500 bid protest decisions, and conducted approximately 20 bid protest hearings. As one of only a few former GAO bid protest hearing officials in private practice, Cherie’s extensive familiarity with the inner workings of the GAO protest process distinguishes her from most other bid protest practitioners.

Cherie is a thought leader on topics relating to bid protests and agencies’ use of their Other Transaction Authority, holds several leadership roles in the ABA Public Contract Law Section, and maintains an active pro bono practice.