Morrison Foerster’s Government Contracts Insights provides our in-depth analysis of developments and trends impacting government contracting. Through Insights, our attorneys offer a real-time assessment of the statutory, regulatory, legal, and business-related developments and trends that are shaping the industry. We also examine a full array of non-U.S. public procurement issues, mindful that our clients compete in a global marketplace.Morrison Foerster’s nationally recognized Government Contracts and Public Procurement practice represents the world’s leading companies in the aerospace and defense, intelligence, cybersecurity, information technology, financial and professional services, education, healthcare, infrastructure, and logistics support sectors. We are enlisted to address our clients’ most complex and important legal issues. Our work includes contract and subcontract negotiation and other transactional matters, business and regulatory compliance counseling, internal investigations, bid protests, and a wide array of enforcement and litigation matters. Our clients range from Fortune 50 companies to small and medium-sized companies just entering the public sector. We advise both U.S. and non-U.S. companies involved in municipal, state, federal, and non-U.S. procurement matters.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

Social

Search

GAO Protest Timeline

govcon-gao-protest-timeline-thumb.jpg

Govcon GAO Post Award Protest Timeline Article

Contract Disputes Act Claim Timeline

govcon-contract-disputes-timeline-thumb.jpg

The Bayh-Dole Act

govcon-bayhdole-thumb.jpg

Anatomy of a Protest

govcon-federalclaimsprotest-thumb.jpg

Allowability of Legal Costs

govcon-allowabilityoflegalcosts-thumb.jpg

Procurement Integrity Act

240715-procurement-integrity-act-resized.jpg

Govcon-Resources

Tina is Co-chair of Morrison Foerster’s Government Contracts & Public Procurement practice. She represents a wide variety of government contractors including information technology, defense, biotechnology, and pharmaceutical companies, with a focus on general contract counseling and compliance, particularly concerning intellectual property, and cybersecurity matters and federal grant funding.Tina counsels contractors on compliance with federal, state and local acquisition and ethics regulations and with the evolving myriad of requirements pertaining to data security and cybersecurity. She has been involved with numerous internal investigations and compliance reviews, and with mandatory and voluntary disclosures to agencies, and litigation of False Claims Act matters.Tina routinely advises clients concerning:<ul><li>Prime-subcontractor relationships</li><li>Sources of supply and country of origin requirements</li><li>Price reductions and price reporting issues</li><li>Organizational conflicts of interest</li><li>Safeguarding of intellectual property and other proprietary interests</li><li>Licensing and data rights issues</li><li>Handling of classified materials and controlled unclassified information</li><li>Agency suspension and debarment proceedings</li></ul>She also assists clients with due diligence and other activities related to the acquisition of government contracting concerns, and with the drafting and negotiation of teaming agreements, subcontracts, licensing agreements, and cooperative research and development agreements. She also assists clients applying for federal grants (including SBIR and STTR agreements), and those who seek to obtain other transactional authority agreements, as well as those competing for state and local government work.Tina’s litigation experience includes government contracts claims litigation in federal courts and before boards of contract appeals, bid protests before the Government Accountability Office and the Court of Federal Claims, and complex disputes in federal courts, including civil fraud and False Claims Act litigation and reverse Freedom of Information Act litigation.Prior to joining Morrison Foerster, Tina worked at another large national firm and as a trial attorney in the Office of the General Counsel of the Navy, Navy Litigation Office.<h4>Representative Experience</h4><ul><li>Negotiation of largest CHIPS Act federal funding agreement between multinational semiconductor corporation and U.S. Department of Commerce.</li><li>Negotiated prime contract and major subcontracts related to the Department of Energy’s next generation supercomputer program, including extensive IP rights negotiations and negotiation of associated patent rights waivers.</li><li>Negotiated series of other transaction authority agreements with DARPA and associated subcontracts with more than a dozen research universities on behalf of a firm biotech client, including complex IP rights allocations and material transfer agreements.</li><li>Assist clients with FedRAMP authorization process and with development of license agreements for software products sold to federal, state and local government agencies.</li><li>Cyber incident response counseling to some of the largest companies and organizations impacted by security incidents.</li><li>Advises clients on Bayh-Dole reporting of inventions and IP strategies for contracts and grants.</li><li>Conducts due diligence for major government contract mergers and acquisitions.</li></ul>

reynolds_tina_blog_150x150.png

reynolds_tina_common_640x280.jpg

reynolds_tina_heroretina_2700x1160.jpg

reynolds_tina_mobileretina_750x1040.jpg

reynolds_tina_social_600x600.jpg

Partner

Tina is co-chair of Morrison Foerster’s Government Contracts & Public Procurement practice. She counsels a wide variety of government contractors on compliance with federal acquisition and ethics regulations. She drafts and negotiates contracts on their behalf and has been involved with numerous internal investigations and compliance reviews, and with bid protest, contract claims, and False Claims Act litigation. She also advises on M&A transactions involving government contractors.

Tina D. Reynolds

Jim Tucker is of counsel in Morrison Foerster’s Government Contracts and Public Procurement Practice Group and is based in the firm’s Washington, D.C. office.Jim’s practice runs the gamut of litigation and counseling in federal procurement matters, with an emphasis on bid protests, Cost Accounting Standards disputes, and small business matters. He has represented both protesters and awardees in scores of protests before the Government Accountability Office, the Court of Federal Claims, and procuring agencies, in acquisitions ranging from small business procurements to multibillion-dollar contracts of global significance. His representative protest matters span the aerospace sector, the Intelligence Community, base operations and logistics, healthcare, nuclear and environmental work, and information technology and software acquisitions. His protests have included both classified and unclassified programs. In addition to prevailing in published decisions, Jim has also secured favorable corrective action on behalf of clients in a wide variety of protests that were resolved without a published decision.Jim’s work also focuses on disputes over cost allowability and compliance with the Cost Accounting Standards, and he has appeared before the Armed Services and Civilian Boards of Contract Appeals, in size and status protests before Small Business Administration (SBA) area offices, and appeals before the SBA Office of Hearings and Appeals. Jim regularly counsels clients on contract interpretation, organizational conflicts of interest, and small business compliance.Jim graduated with high honors from the George Washington University Law School, where he focused his studies on federal procurement law, was a member of the Law Review, and interned with the General Services Administration’s suspension and debarment office. Jim also holds a degree in theology magna cum laude from the Pontifical Gregorian University in Rome and a bachelor’s degree in classical languages and literature summa cum laude from the University of Kentucky, where he graduated Phi Beta Kappa.

tucker_james_blog_150x150.png

tucker_james_common_640x280.jpg

tucker_james_heroretina_2700x1160.jpg

tucker_james_mobileretina_750x1040.jpg

tucker_james_social_600x600.jpg

Of Counsel

Jim maintains an active practice in bid protests before the Government Accountability Office and contracting agencies and counsels clients in contract disputes and compliance obligations.

Jim Tucker is of counsel in Morrison Foerster’s Government Contracts and Public Procurement Practice Group and is based in the firm’s Washington, D.C. office. Jim’s practice runs the gamut of litigation and counseling in federal procurement matters, with an emphasis on bid protests, Cost Accounting Standards disputes, and small business matters.

James Tucker

<div style="margin-bottom: 15px;" class="videoWrapper"><iframe class="sticky-video" title="Meet Alex Ward, Government Contracts Practice Co-Chair" src="https://www.youtube-nocookie.com/embed/TkliwdSlTaQ?rel=0" frameborder="0" allow="autoplay; encrypted-media" allowfullscreen="1" title="iframe"></iframe></div>J. Alex Ward is co-chair of Morrison Foerster’s Government Contracts and Public Procurement group. His practice covers a full range of government contracts matters, including investigations, bid protests, claims, general litigation, corporate transactions, and counseling. Alex strives in all matters is to provide his clients the highest level of efficient and effective representation.Alex represents contractors in internal and external investigations, disclosures to the government, and qui tam litigation, with great success in reducing or eliminating his clients’ exposure through active engagement with the government. His work in this area includes obtaining numerous declinations and dismissals of False Claims Act cases in their earliest stages, sparing his clients the cost, risk, and exposure of litigation.He has also served as lead counsel in dozens of bid protests involving military and civilian agency procurements of a wide range of products and services, including all manner of pre- and post-award protests in the GAO, the U.S. Court of Federal Claims, and state tribunals, as well as appeals to the U.S. Court of Appeals for the Federal Circuit and size protest appeals before the SBA’s Office of Hearings and Appeals.Alex handles all aspects of the claims process, from the initial assessment and drafting of requests for equitable adjustment through litigation in the Boards of Contract Appeals and the Court of Federal Claims. Alex’s practice also covers the full gamut of other controversies confronting government contractors, including prime-sub, teaming partner, employer-employee, competitor, and indemnification disputes. His litigation work also includes a wide variety of pro bono engagements, in which he has represented both individual and institutional clients in matters ranging from immigration and criminal defense to sustainable procurement and protection of the environment.Prior to joining the firm, Alex served in the U.S. Army as a commissioned officer and an Assistant to the General Counsel of the Army responsible for civil works and international matters, and as a clerk for judges on the U.S. Courts of Appeals for the Armed Forces and the D.C. Circuit. He is a member of the Boards of the Morrison & Foerster Foundation and the Chesapeake Bay Foundation and of Law360’s Government Contracts Editorial Board.

ward_alex_blog_150x150.png

ward_alex_common_640x280.jpg

ward_alex_heroretina_2700x1160.jpg

ward_alex_mobileretina_750x1040.jpg

ward_alex_social_600x600.jpg

Alex is co-chair of Morrison Foerster’s Government Contracts and Public Procurement practice. His practice covers a full range of government contracts matters, including bid protests, claims, investigations, corporate transactions, and counseling.

J. Alex Ward

favicon.ico

favicon-16x16.png

favicon-32x32.png

apple-touch-icon.png

MoFo Favicons

Morrison Foerster’s Government Contracts Insights blog provides an in-depth analysis of news, developments, and trends impacting government contracting and procurement. Through Insights, attorneys from our nationally recognized Government Contracts and Public Procurement practice will offer a real-time assessment of the statutory, regulatory, legal, and business-related developments that are shaping the industry. This blog will also examine a full array of U.S. and non-U.S. public procurement issues, mindful that our clients compete in a global marketplace.Read about our <a href="http://govcon.mofo.com/editors/">Authors</a>.Never miss a post. Subscribe to get real-time updates.

Brad is a partner in Morrison Foerster’s Litigation Department, Managing Partner of the Austin office, and Chair of the firm’s Israel practice. He is the former Co-Chair of the firm’s Global Litigation Practice and the Government Contracts + Public Procurement Practice.

Bradley Wine

gov-con-feature-image-thumb1.jpg

Welcome to the Government Contracts Insights Blog

Welcome to the Government Contracts Insights Blog

gov-con-feature-image_(1)1.jpg

The United States Capitol building

Morrison Foerster’s Government Contracts Insights blog provides an in-depth analysis of news, developments, and trends impacting government contracting and proc

Announcements & Press

Blog - Terms of Use

Blog - Privacy Policy

Blog - Blog Disclaimer

Blog - Attorney Advertising

morrison-foerster-blog-logo.png

Provides insights and reports on the most current class actions lawsuits and product liability issues that affect consumer-facing companies.

Class Dismissed Blog

Class Dismissed

Looks behind the headlines to explore the trends, identify the opportunities, analyze the issues, and provide guidance for science and technology-based companies.

MoFo Tech

Mofo Tech

News and thought leadership from lawyers who are adding value to the legal profession and the communities we call home.

  External-Link

MoFo + Blog

Mofo+

Stay on top of emerging issues and stay informed of developments related to the law and business of social media.

Socially Aware

Our Government Contracts Insights blog provides in-depth analysis of developments and trends impacting U.S. government contracting and non-U.S. public procureme

Government Contracts Insights

  Linkedin

MoFo LinkedIN

Blog - Govcon RSS

Stay Connected

Never miss a post from Government Contracts Insights. Enter your email below to stay up-to-date.

Subscribe

The latest updates and analysis from Morrison Foerster

Morrison Foerster - Footer

Small business regulations create one of the stickier wickets in bid protest litigation. 

Blogs -  Home Button

Home

Blog - Topics

Acquisition Regulations

Artificial Intelligence + Robotics

Compliance

Coronavirus

Cybersecurity & Data Privacy

Data Rights

Defense

Domestic Preferences

False Claims Act

Federal Procurement

Foreign Corrupt Practices Act

Grants

Health Care

Intellectual Property

International Public Procurement

Labor & Employment

Mergers & Acquisitions

National Security

Protests & Litigation

Resources

Schedule Contracting

Small Business

Topics

Blog - Editors

Editors

Blog - About

About

Blog - Subscribe

GAO Finds Company's BPA BID Remains Eligible for Award Despite a Transaction, Recertification, and Change in Size Status in Connection with Its Underlying Federal Supply Schedule Contract | Government Contracts Insights

Damien C. Specht

James A. Tucker

Small business regulations create one of the stickier wickets in bid protest litigation. Although the Small Business Administration (SBA) has exclusive authority to determine a company’s size and socioeconomic status, the Government Accountability Office (GAO) sometimes must wrestle with size and status questions to adjudicate bid protests. The GAO’s recent decision in <a href="https://www.gao.gov/assets/870/864489.pdf" target="_blank" dir="ltr">Washington Business Dynamics, B-421953, B-421953.2, Dec. 18, 2023</a>, includes a lengthy analysis of a particularly complicated question: the effect of a merger or acquisition on a pending quotation for an order or Blanket Purchase Agreement (BPA) under a Federal Supply Schedule (FSS) contract. In this decision, the GAO held that, although a company recertified its size under an FSS contract following a merger or acquisition, that recertification did not trigger a further recertification in connection with its pending quotation for a BPA under that FSS contract. That, at least, was the outcome under the regulations as they stood at the time and the facts of this particular case.Factual BackgroundThe protest involved an Office of Personnel Management (OPM) Request for Quotations (RFQ) for a BPA under Federal Acquisition Regulation (FAR) Subpart 8.4. OPM issued the RFQ to service-disabled veteran-owned small businesses (SDVOSB) holding FSS contracts for professional services. The RFQ did not request vendors to recertify their size or status in connection with the procurement.On February 1, 2023, the protester (which was the incumbent for these services) submitted its quotation in response to the RFQ. At that time, and as of the date of its initial offer for its underlying FSS contract, the protester was an SDVOSB. On June 28, 2023, which was 147 days after it submitted its quotation, the protester was acquired by a non-SDVOSB firm and lost its SDVOSB status as a result. In accordance with FAR 52.219-28(b)(2), the protester timely notified OPM under the protester’s incumbent BPA of the acquisition and that it was no longer an SDVOSB.OPM completed the procurement for the new BPA, documented that the protester was no longer an SDVOSB, and awarded the BPA to a vendor with a lower price and equal non-price ratings. The protest followed.AnalysisAs a threshold matter—and the question on which this article focuses—OPM requested that the GAO dismiss the protest because the protester’s change in size status allegedly meant it was no longer eligible for award of the BPA. According to OPM, because the protester ceased to be an SDVOSB within 180 days after the submission of its BPA quotation, the protester was ineligible for award pursuant to 13 C.F.R. § 121.404(g)(2)(iii). That regulation, in the form it existed at release of the RFQ, provided:If the merger, sale or acquisition occurs after offer but prior to award, the offeror must recertify its size to the contracting officer prior to award.  If the merger, sale or acquisition (including agreements in principal [sic]) occurs within 180 days of the date of an offer and the offeror is unable to recertify as small, it will not be eligible as a small business to receive the award of the contract.  If the merger, sale or acquisition (including agreements in principal [sic]) occurs more than 180 days after the date of an offer, award can be made, but it will not count as an award to small business.13 C.F.R. § 121.404(g)(2)(iii) (emphasis added). SBA subsequently amended this regulation to provide that it applies not only to offers for the award of a contract, but also to offers for the award of an order or agreement; it appears unlikely this change would have altered the outcome here, but that is an open question, as the GAO found the amendment had no effect on this procurement. The GAO sought input from SBA, which apparently agreed with OPM and the awardee that the acquisition required the protester to recertify in connection with the procurement and, because the transaction occurred within 180 days after submission of the protester’s quotation for the BPA, the protester’s change in status made it ineligible for award.The GAO disagreed and found that OPM’s and SBA’s interpretation of the governing SBA regulations was unreasonable. In the GAO’s view, these recertification and ineligibility provisions do not apply to quotations for orders and BPAs under an FSS contract.  In Odyssey Systems Consulting Group, Ltd., B-419731 et al., July 15, 2021, 2021 CPD ¶ 260, the GAO previously considered the 180-day rule in the context of a task order competition under a non-FSS multiple-award contract, where the contract was previously set aside for small business. In that context, where the contracting officer had not specifically required a recertification in connection with the order, the GAO held that an offeror remains eligible for award of the order, regardless of any transactions or size status changes inside or outside the 180-day window. As we have <a href="https://govcon.mofo.com/topics/220222-january-2022-bid-protest-roundup" target="_blank" dir="ltr">previously discussed</a>, SBA’s Office of Hearings and Appeals (OHA) has made the same determination. See Size Appeal of Odyssey Systems Consulting Group, Ltd., SBA No. SIZ-6135 (2021).Turning to the FSS BPA competition at issue here, the GAO began by quoting OHA’s recognition of the general rule that “a prime contractor that is small at the time of the contract award remains small for all orders issued under the contract, unless the [contracting officer], in his or her role discretion, chooses to request recertification on an individual order-by-order basis.” Size Appeal of EBA Ernest Bland Assocs. PC, SBA No. SIZ-6139 (2022), 2022 WL 529352 at *5.The GAO acknowledged that there are exceptions to this general rule. One of the exceptions applies to subsequent set-aside competitions under unrestricted multiple-award contracts. In such contexts, “a concern must recertify its size status and qualify as a small business at the time it submits its initial offer, which includes price, for the particular order or Blanket Purchase Agreement.” 13 C.F.R. § 121.404(a)(1)(i)(A) (for unrestricted multiple-award contracts assigned a single NAICS code); see also 13 C.F.R. § 121.404(a)(1)(ii)(A) (same for unrestricted multiple-award contracts assigned multiple NAICS codes). By the terms of the regulations themselves, however, this exception to the general rule does not apply to “orders and Blanket Purchase Agreements issued under any Federal Supply Schedule contract.” 13 C.F.R. § 121.404(a)(1)(i)(A); see also 13 C.F.R. § 121.404(a)(1)(ii)(A). Thus, there is no standalone requirement for vendors to recertify in connection with offers for orders or BPAs under an FSS contract. The GAO noted that SBA’s OHA has expressly held the same thing. Size Appeal of Oxford Gov. Consulting LLC, SBA No. SIZ-5732 (2016), 2016 WL 4990545 at *2 (“[R]ecertification is not required under a BPA issued against an FSS.”); see also Size Appeal of EBA Ernest Bland Assocs. PC, SBA SIZ No. 6139 (2022), 2022 WL 529352 at *6 (finding that, absent a specific order-level recertification requested by the contracting officer, there was no requirement to recertify at the FSS-order level).The GAO briefly noted that, for contracts already awarded, 13 C.F.R. § 121.404(g)(2)(i) (like FAR 52.219-28(b)) requires a contractor to recertify as small or notify the agency of a change in status under an awarded contract within 30 days after a merger, sale, or acquisition, where contract novation is not required. If the contractor is no longer small, the agency may continue to exercise options and issue new orders under the contract but can no longer count them towards its small business goals. This post-award recertification/notification requirement does not apply to pending offers.The GAO finally turned to 13 C.F.R. § 121.404(g)(2)(iii), which articulates the 180-day rule for pending offers. This rule is a creature of regulation and does not come from any specific statutory requirement. If a transaction occurs more than 180 days after the offer submission, and that causes a concern to exceed the size status, then, similar to 13 C.F.R. § 121.404(g)(2)(i), the concern remains eligible for the set-aside award, but the agency may not count the award towards its small business goals. If, however, the transaction occurs within 180 days after offer submission, then the concern will be ineligible to receive the award. The GAO agreed with the protester that 13 C.F.R. § 121.404(g)(2)(iii) is inapplicable to pending offerors for FSS orders or BPAs. The GAO observed that set-aside orders and BPAs issued against the FSS are expressly exempt from recertification requirements. 13 C.F.R. §§ 121.404(a)(1)(ii)(A), 121.404(a)(2). It also noted that SBA’s OHA has previously held that a transaction requiring an FSS contract-level recertification under 13 C.F.R. § 121.404(g)(2)(i) does not trigger a similar recertification obligation with respect to pending quotations for orders or BPAs under that FSS contract. Size Appeal of EBA Ernest Bland Assocs. PC, SBA SIZ No. 6139 (2022), 2022 WL 529352 at *4. Thus, consistent with this OHA holding, the GAO found the transaction had no effect on the protester’s eligibility for award of the BPA here.The GAO acknowledged, in a footnote, that the SBA raised policy reasons to support its position that the recertification regulations apply to all orders and agreements, including those under the FSS. But policy considerations cannot override the text of the regulations, which the GAO found expressly exempted FSS orders and agreements.The GAO, in another footnote, highlighted the “incongruous” results that would flow from OPM’s and SBA’s interpretation. Under the agencies’ interpretation, if the protester had been acquired before offer submission, then 13 C.F.R. § 121.404(a)(1)(ii)(A) would govern the subsequent BPA competition, under which the protester would not be required to recertify in connection with the offer and would be eligible for award. The GAO reasoned that, because there was no apparent reason for such an absurd result, the agencies’ preferred interpretation did not appear reasonable.The GAO noted its decision was “limited to the unique factual circumstances presented in this case,” but that was enough to find the protester was eligible for award and thus was an interested party with standing to protest. Unless the SBA amends its regulations, though, this decision will be instructive for FSS contractors in the not so “unique factual circumstances” of undergoing transactions while they have FSS order or BPA bids pending.Takeaways<ol><li dir="ltr">Small business regulations are complicated, as a general rule. And, as the GAO observed in Odyssey Systems, the regulations governing transactions in particular are “not a model of clarity.” Companies with small business contracts and proposals (and those interested in acquiring them) should seek legal counsel prior to any merger or acquisition.</li><li dir="ltr">Don’t assume the rules applicable to contracts are also applicable to orders and BPAs, or that the rules governing FSS orders and BPAs are the same as those governing non-FSS orders and agreements.</li><li dir="ltr">Careful parsing of the regulatory text is always necessary. What the small business regulations require and what the SBA intended them to require are not necessarily the same thing. Although the GAO will give due deference to SBA’s views, this and similar protest decisions show the GAO will not endorse an SBA interpretation that it finds is inconsistent with the text of a regulation.</li></ol>

GAO Finds Company's BPA BID Remains Eligible for Award Despite a Transaction, Recertification, and Change in Size Status in Connection with Its Underlying Federal Supply Schedule Contract

More

The Tortured Regulations Department: SBA’s New Rule and Its Effect on Investments

Bid Protest Spotlight: Standing, Relationships, Responsibility

House’s Passage of the SAMOSA Act Signals Policy Shift Towards Government-Wide Enterprise Software Licensing

New DFARS Regulation on Small Business Affiliate Past Performance

Bid Protest Spotlight: Unclear Criteria, Data Rights, Conflicts

LinkedIN