Identifying Unequal Access OCIs Is Harder Than It looks
July 27, 2018
By: Eric Whytsell and Emely Garcia
Unequal access to competitively useful, non-public information can give contractors an unfair advantage in the procurement process. Accordingly, the Federal Acquisition Regulation (FAR) requires contracting officers to identify and evaluate potential “unequal access” organizational conflicts of interest (OCIs) and directs agencies to avoid or mitigate potential conflicts. Following this direction, however, is not always as easy as it might sound. Agencies sometimes have difficulty correctly identifying unequal access OCIs. Such errors can cut both ways. As evidenced by the recent decision in Archimedes Global, Inc., B-415886.2 (June 1, 2018), contracting officers sometimes paint with too broad a brush and eliminate bidders for nonexistent OCIs. On the other end of the spectrum, agencies may fail to identify OCIs due to an improper analysis of potential conflicts, a situation described in the decision in Dell Services Federal Government, Inc., B-414461.3; B-414461.4; B-414461.5 (June 19, 2018).
Archimedes Global, Inc. involved the elimination of Archimedes Global (AGI) from consideration for a Department of Homeland Security, United States Citizenship and Immigration Services contract award based on an alleged unequal access OCI. Due to a previous contract with the agency, Ambit Group, LLC (Ambit) was precluded from competing for the contract at issue. AGI submitted a proposal that identified two Ambit employees for prospective positions. The agency eliminated AGI from consideration because it determined one of the two Ambit employees may have had access to competitively useful, non-public information, including the statement of work from the Ambit contract and agency budget information. The agency concluded that AGI appeared have an unequal access OCI and removed it from consideration.
When AGI protested that decision, the Government Accountability Office (GAO) first noted the mere appearance of an OCI is not enough to eliminate a contractor from consideration for a contract. An unequal access OCI exists where the offeror obtains non-public information that may be competitively useful in acquiring a contract and uses that information in preparing its proposal. As the GAO explained, contracting officers considering whether an OCI exists must examine the particular facts of the contracting situation and the nature of the proposed contract, then use “common sense, good judgement, and sound discretion” in reaching a decision. Unfortunately, the exercise of such discretion sometimes leads to incorrect determinations. In AGI, the agency’s mistake was to focus exclusively on whether there was a possibility of an OCI.
In its AGI decision, the GAO noted that although one of the Ambit employees had the ability to access competitively useful, non-public information, the record showed that the employee did not in fact access that information. Furthermore, while the Ambit employees agreed to be included in AGI’s proposal, they did not actually participate in the preparation of the proposal—in part because they were still Ambit employees at the time AGI was preparing its proposal. The GAO characterized the agency’s decision to disqualify AGI as being based on “innuendo and supposition” instead of actual facts concerning the real activities of the Ambit employees. While Ambit as a contractor was precluded outright from the competing for the contract, Ambit employees were not prohibited from helping to perform it if no unequal access OCI existed. In other words, guilt by association is not a sufficient ground for an agency to find an unequal access OCI and disqualify an offeror.
Whereas some contracting officers go too far and find unequal access OCIs when they are not supported by the facts, other contracting officers are guilty of not going far enough--missing OCIs that do exist because they didn’t properly consider the facts. In Dell Services Federal Government, Inc., Dell Services (DSFG) protested the Department of Education’s award of a task order for IT services, known as PIVOT I, to SRA International (SRA). DSFG previously provided the agency with IT services and products under a ten-year contract called Education Department Utility for Communications, Applications and Technology Environment (EDUCATE). DSFG previously filed a pre-award protest regarding the new PIVOT I contract because SRA had improperly obtained DSFG’s old proposals in connection with the EDUCATE contract.
The GAO sustained DSFG’s pre-award protest because the agency failed to consider the impact of the improper disclosure and SRA’s potential unequal access OCI. The GAO recommended in part that the agency reassess whether SRA had an unequal access OCI. The agency conducted an investigation and determined SRA did not have an OCI and was eligible for the contract in part because DSFG’s old proposals were outdated and not competitively useful. Also, the agency concluded based on the record that SRA did not access the improperly disclosed information. DSFG filed its follow-on protest arguing that the agency should have concluded that SRA had an unequal access OCI and precluded SRA from consideration for the contract.
As stated in the AGI decision, in order to determine that an unequal access OCI exists, a contracting officer must conclude that the contractor both accessed non-public information and used that information in preparing its bid to gain a competitive advantage. The FAR primarily discusses unequal access OCIs in terms of improper access to proprietary information. The Dell Services decision makes clear, however, that even if proprietary information is not involved, a contracting officer must still consider the potential unfair advantage an offeror might gain from other non-public, competitively useful information.
During the course of its investigation into the alleged unequal access OCI, the contracting officer identified an individual that had access to and had learned confidential information from his involvement in the performance of the EDUCATE contract. That individual went to work for a teaming partner of SRA and assisted SRA in preparing its proposal for the PIVOT I contract. The contracting officer specifically noted that the individual’s insights were “highly qualified” and based on non-public facts not intended for use by a competitor of DFSG. Still, the contracting officer concluded there was no OCI because the individual did not share DSFG’s proprietary information and the information that was provided was general in nature. The GAO determined that the contracting officer failed to identify an OCI because it improperly limited its OCI analysis to whether or not the individual provided DFSG’s proprietary information to SRA. Instead, the agency should have considered whether the non-public information that the individual obtained while performing a previous contract was provided to SRA and gave it a competitive advantage.
The AGI and DSFG protests demonstrate two opposite but equally improper approaches to identifying unequal access OCIs. Both can be avoided if the contracting officer properly considers the relevant facts and makes the OCI determination based on what the facts actually show, no more and no less. Contractors that have been eliminated from consideration on unequal access OCI allegations should be on the lookout for OCI findings based solely on the mere appearance of a conflict or those that don’t take into account the impact of information other than proprietary information. If either of those circumstances exists, you should consider whether an OCI-related protest is in order.
Emely Garcia and Eric Whytsell are responsible for the contents of this article.
© 2018 Jackson Kelly PLLC