Contracting Officer Decisions Must be Based on Facts, Not Innuendo

DHS (Department of Homeland Security) issued an RFP (Request for Proposal) for a company to help with management and support services. During the evaluation process, DHS eliminated one of the offerors, Archimedes Global, Inc (AGI) because of an "alleged" OCI (Organizational Conflict of Interest). AGI protested its elimination from consideration on the grounds the OCI did not exist.

By way of background, the predecessor contract required the contractor to have access to procurement sensitive information. Accordingly, the contract included a clause permitting DHS to disqualify the incumbent contractor from competing for follow-on work. The incumbent contractor was Ambit Group and everyone agreed that Ambit was precluded from competing for the current contract.

The OCI issue stemmed from the fact that AGI proposed to hire the senior and intermediate program managers currently working for Ambit. DHS found that Ambit employees could have provided AGI with unequal access to non-public, competitively useful information, and accordingly, that AGI had an apparent "unequal access" type of OCI. After an initial appeal of DHS's actions, DHS agreed to revisit its determination but once again, eliminated AGI for having an "appearance" of a conflict of interest. Note that DHS's opinion changed from an actual OCI to an appearance of an OCI but the results were the same, AGI was excluded from competition. Once again, AGI appealed the decision.

DHS disqualified AGI because the contracting officer believed that AGI may have had access to competitively useful, non-public information that may have been helpful in preparing its proposal.One of the two individuals AGI proposed to use, the intermediate program manager, had the capability to access files on DHS's computer system that contained competitively useful information, including an independent Government estimate, the statement of work, and budgetary information.

AGI submitted affidavits to DSH stating that neither of the Ambit employees that it proposed actually accessed competitively useful information during performance of the Ambit contract. Specifically, the proposed senior program manager represented that he was precluded from accessing the competitively useful information  because of a firewall. The intermediate program manager represented that, although theoretically he had access to non-public, competitively useful information, he did not, if fact, access the information during any relevant time.

Undeterred, the contracting officer reaffirmed that AGI was not eligible for award due to the appearance of conflict of interest.

AGI argued that it was unreasonable for DHS to disqualify it from consideration, principally because DHS's analysis ignored the fact that the individuals in question were not AGI employees and did not participate in the preparation of AGI's proposal. AGI merely offered them jobs in the event it was awarded the contract.

The GAO (Government Accountability Office) agreed with AGI and sustained its protest. The GAO ruled that DHS's decision to disqualify AGI was not based on hard facts, but, rather, on innuendo and supposition concerning the activities of the Ambit employees. The GAO wrote:
Chief amount our concerns is the fact that the contracting officer, without any underlying evidence, concluded that, because there was a possibility that the individuals in question may have had access to competitively useful, non-public information, that information necessarily was provided to AGI. However, the record shows that neither individual currently is employed by AGI, and there is no evidence to show that the individuals provided AGI with competitively useful, non-public information, or otherwise participated in preparing the AGI proposal.

Well, back to the drawing board for DHS. They will need to reconsider their exclusion of AGI's bid.