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Fundamentals of Government Contract Claims and Protests August 17, 2005 Alan A. Pemberton Covington & Burling
Overview <ul><li>Differences Between Protests and Claims </li></ul><ul><li>Protests  </li></ul><ul><ul><li>Where to protes...
What is the difference between a Protest and a Claim? <ul><li>PROTEST - a complaint about the Government’s handling of the...
Why do these differences matter? <ul><li>Strict timing rules apply, especially to protests. </li></ul><ul><li>Special proc...
Examples of Grounds for Claims and Protests  <ul><li>HHS releases RFP that says that any party awarded a contract for vacc...
Protests
Protests – Where to Protest <ul><li>Agency </li></ul><ul><ul><li>Contracting Officer </li></ul></ul><ul><ul><li>Higher Lev...
Protests – Basic Timing Requirements <ul><li>Agency or to GAO </li></ul><ul><ul><li>Preaward protests – before next offers...
Protests – Basic Timing Requirements <ul><li>Court of Federal Claims </li></ul><ul><ul><li>Court generally follows GAO rul...
Protests – Sample Protest Issues <ul><li>Pre-Award Issues: </li></ul><ul><ul><li>Restrictive Specifications </li></ul></ul...
Protest Procedures <ul><li>Agency  </li></ul><ul><ul><li>Quick, informal resolution, relatively low legal costs </li></ul>...
Protests – Strategic Considerations <ul><li>Angering the customer </li></ul><ul><ul><li>Agency protests less disruptive th...
Protests – Strategic Considerations Not subject to override, can be more difficult to obtain Extensive discovery, protecti...
Claims
Claims – Basic Statutory Requirements Contract Disputes Act <ul><li>CDA procedures begin with making a written demand or a...
Claims – Subcontractor Claims <ul><li>CDA claims do not generally include subcontractor claims against prime contractor. <...
Claims – Examples of CDA Claims <ul><li>Price Adjustment issues </li></ul><ul><li>Excusable delay/Government-caused delay ...
Claims – Examples of Claims NOT covered by CDA <ul><li>Fraud / criminal matters </li></ul><ul><li>Tort Claims </li></ul><u...
Claims – Alternative Dispute Resolution <ul><li>Boards and Courts encourage ADR and have a variety of approaches </li></ul...
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Claims and Protests

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Claims and Protests

  1. 1. Fundamentals of Government Contract Claims and Protests August 17, 2005 Alan A. Pemberton Covington & Burling
  2. 2. Overview <ul><li>Differences Between Protests and Claims </li></ul><ul><li>Protests </li></ul><ul><ul><li>Where to protest </li></ul></ul><ul><ul><li>When to protest </li></ul></ul><ul><ul><li>Protest procedures </li></ul></ul><ul><ul><li>Examples of protest issues and remedies </li></ul></ul><ul><ul><li>Strategic considerations </li></ul></ul><ul><li>Claims </li></ul><ul><ul><li>Basic statutory requirements </li></ul></ul><ul><ul><li>Examples of claims </li></ul></ul><ul><ul><li>Subcontract claims </li></ul></ul><ul><ul><li>Alternative Dispute Resolution </li></ul></ul>
  3. 3. What is the difference between a Protest and a Claim? <ul><li>PROTEST - a complaint about the Government’s handling of the procurement process up to and including award </li></ul><ul><ul><li>Pre-award (complaints about the rules of the game) </li></ul></ul><ul><ul><li>Post-award (complaints about the award decision and how the game was played) </li></ul></ul><ul><li>CLAIM – a complaint by a party to an existing contract against another party to the contract. </li></ul><ul><ul><li>Contractor Claims vs. Government </li></ul></ul><ul><ul><li>Government Claims vs. Contractors </li></ul></ul><ul><ul><li>3 rd Party Beneficiary Claims? </li></ul></ul>
  4. 4. Why do these differences matter? <ul><li>Strict timing rules apply, especially to protests. </li></ul><ul><li>Special procedures apply, especially to claims. </li></ul>
  5. 5. Examples of Grounds for Claims and Protests <ul><li>HHS releases RFP that says that any party awarded a contract for vaccine will have to produce it in the United States. </li></ul><ul><li>Manufacturer’s contract is terminated by DoD for default because of late deliveries, and DoD announces it will reprocure the item from another source. </li></ul><ul><li>Government awards a contract to a competitor that you know lacks the capacity to do the job right. </li></ul><ul><li>Government instructs contractor to make changes in product under fixed-price contract that will greatly increase contractor’s costs of performance. </li></ul>
  6. 6. Protests
  7. 7. Protests – Where to Protest <ul><li>Agency </li></ul><ul><ul><li>Contracting Officer </li></ul></ul><ul><ul><li>Higher Level Intra-Agency Authority </li></ul></ul><ul><li>Government Accountability Office </li></ul><ul><li>U.S. Court of Federal Claims </li></ul><ul><li>SBA </li></ul><ul><ul><li>protests of small business status in set-asides </li></ul></ul>
  8. 8. Protests – Basic Timing Requirements <ul><li>Agency or to GAO </li></ul><ul><ul><li>Preaward protests – before next offers are due </li></ul></ul><ul><ul><li>Postaward protests – if no debriefing, 10 days after notice </li></ul></ul><ul><ul><ul><li>Debriefing request – 3 days after notice </li></ul></ul></ul><ul><ul><ul><li>Protest filing – 5 days after a “required” debriefing to invoke automatic stay </li></ul></ul></ul><ul><ul><ul><ul><li>Protest filing still timely if 10 days after debriefing </li></ul></ul></ul></ul><ul><ul><ul><li>Exclusion from competitive range – similar to award notice </li></ul></ul></ul><ul><ul><li>Other Issues – within 10 days of knowledge </li></ul></ul>
  9. 9. Protests – Basic Timing Requirements <ul><li>Court of Federal Claims </li></ul><ul><ul><li>Court generally follows GAO rule as to preaward protests. </li></ul></ul><ul><ul><li>Equitable timing requirements – court will assess whether plaintiff has acted unfairly or without excuse in bringing suit long after award </li></ul></ul>
  10. 10. Protests – Sample Protest Issues <ul><li>Pre-Award Issues: </li></ul><ul><ul><li>Restrictive Specifications </li></ul></ul><ul><ul><li>Ambiguous Specifications </li></ul></ul><ul><ul><li>Improper Sole Source or Limit on Competition </li></ul></ul><ul><ul><li>Unreasonable bundling of requirements </li></ul></ul><ul><ul><li>Improper RFP terms </li></ul></ul><ul><li>Post-Award Issues: </li></ul><ul><ul><li>Improper Evaluation </li></ul></ul><ul><ul><ul><li>Use of unannounced criteria </li></ul></ul></ul><ul><ul><ul><li>Failure to follow RFP criteria </li></ul></ul></ul><ul><ul><ul><li>Unfair application of criteria </li></ul></ul></ul><ul><ul><li>Improper Exclusion from Competitive Range </li></ul></ul><ul><ul><ul><li>Failure to discuss significant weaknesses </li></ul></ul></ul><ul><ul><li>Unequal Discussions </li></ul></ul><ul><ul><ul><li>Technical transfusion </li></ul></ul></ul><ul><ul><li>Basic Theme – lack of equal treatment among offerors </li></ul></ul>
  11. 11. Protest Procedures <ul><li>Agency </li></ul><ul><ul><li>Quick, informal resolution, relatively low legal costs </li></ul></ul><ul><ul><li>Little discovery </li></ul></ul><ul><li>GAO </li></ul><ul><ul><li>Resolution in 100 days </li></ul></ul><ul><ul><li>Relatively full discovery with protective order </li></ul></ul><ul><ul><li>Supplemental protests based on documents produced </li></ul></ul><ul><ul><li>Possible hearings </li></ul></ul><ul><li>Court of Federal Claims </li></ul><ul><ul><li>No set time for resolution, but proceedings can be extremely expedited. </li></ul></ul><ul><ul><li>Relatively full discovery – possible depositions </li></ul></ul><ul><ul><li>Supplemental or amended protests possible </li></ul></ul><ul><ul><li>Oral argument on cross-motions </li></ul></ul>
  12. 12. Protests – Strategic Considerations <ul><li>Angering the customer </li></ul><ul><ul><li>Agency protests less disruptive than GAO or Court </li></ul></ul><ul><li>Likelihood of success </li></ul><ul><ul><li>Depends on the issue </li></ul></ul><ul><li>Effectiveness of stay </li></ul><ul><li>Cost / speed of decision </li></ul><ul><li>Likelihood of discovery to uncover new errors </li></ul><ul><li>Winning the protest versus winning the contract </li></ul><ul><ul><li>Possibility of “corrective action” that cures problem without helping protester </li></ul></ul>
  13. 13. Protests – Strategic Considerations Not subject to override, can be more difficult to obtain Extensive discovery, protective order Depends on case/ Most expensive Moderate (depends on situation) Court Subject to override Extensive discovery, protective order 100 days/ Relatively expensive Moderate (depends on situation) GAO Subject to override Least discovery Lowest cost/Fastest decision Lowest Agency Stay Discovery Cost/Speed “ Angering Customer” Forum
  14. 14. Claims
  15. 15. Claims – Basic Statutory Requirements Contract Disputes Act <ul><li>CDA procedures begin with making a written demand or assertion called a “claim.” </li></ul><ul><ul><li>Claim may be presented within 6 years of when it accrues. (Note different from appeal time from final decision.) </li></ul></ul><ul><ul><li>Claims over $100,000 must be certified. </li></ul></ul><ul><li>Claim results in Contracting Officer’s “final decision.” </li></ul><ul><li>Appeal from final decision </li></ul><ul><ul><li>To a Board of Contract Appeals within 90 days OR </li></ul></ul><ul><ul><li>To the Court of Federal Claims within one year. </li></ul></ul><ul><li>CDA procedures are exclusive. </li></ul>
  16. 16. Claims – Subcontractor Claims <ul><li>CDA claims do not generally include subcontractor claims against prime contractor. </li></ul><ul><li>Subcontractor claims are generally subject to ordinary state contract law governing contracts between private parties, with federal law used to interpret FAR-type provisions </li></ul><ul><li>Some subcontractors may obtain agreement of prime contractor to “sponsor” a CDA claim, in which the sub sues the Government in the prime’s name. </li></ul>
  17. 17. Claims – Examples of CDA Claims <ul><li>Price Adjustment issues </li></ul><ul><li>Excusable delay/Government-caused delay </li></ul><ul><li>Appeal of default termination </li></ul><ul><li>Defective pricing </li></ul><ul><li>Alleged noncompliance with contract terms </li></ul>
  18. 18. Claims – Examples of Claims NOT covered by CDA <ul><li>Fraud / criminal matters </li></ul><ul><li>Tort Claims </li></ul><ul><li>Subcontractor claims </li></ul><ul><li>Contracts between U.S. and Foreign Govt. </li></ul>
  19. 19. Claims – Alternative Dispute Resolution <ul><li>Boards and Courts encourage ADR and have a variety of approaches </li></ul><ul><ul><li>Non-binding mini-trials </li></ul></ul><ul><ul><li>Mediation </li></ul></ul><ul><ul><li>Settlement judges </li></ul></ul><ul><ul><li>Party-designed processes </li></ul></ul>

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