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The GAO decision underscores that while an Organizational Conflict of Interest (OCI) can be an extremely effective ground for protest, contractors considering making such allegations must be able to demonstrate beyond mere inference or suspicion that an OCI exists, particularly given that a Contracting Officer's (CO's) evaluation of OCI concerns is allowed broad deference.
The Procurement at Issue
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NASA asserted that it had taken reasonable and appropriate steps to avoid or mitigate any conflict of interest, that
Discussion
FAR 3.101-1 provides that "[g]overnment business shall be conducted in a manner above reproach and, except as authorized by statute or regulation, with complete impartiality and with preferential treatment for none . . . The general rule is to avoid strictly any conflict of interest or even the appearance of a conflict of interest in Government contractor relationships." Where the record establishes that a conflict exists, the GAO will presume that the protester was prejudiced unless the record shows there is no prejudice.
OCIs generally fall into one of three categories:
- Impaired objectivity. This OCI arises in circumstances where a contractor somehow evaluates itself or makes recommendations as to current or future procurement priorities. GAO will look to "whether a firm is in a position to make judgments or recommendations that would have the effect of directly influencing its own wellbeing."
L-3 Services Inc. , B-400134.11 et al.,Sept. 3, 2009 , 2009 CPD ¶ 171. - Biased ground rules: This OCI arises from situations where the contractor has somehow influenced the ground rules for the procurement, e.g., preparing statements of work or procurement requirements.
- Unequal access to information: This OCI arises from a contractor's performance under one contract, which provides the contractor with information that is not publicly available, giving it an unfair competitive advantage. This may include the improper disclosure of source selection information.
Generally, agencies are afforded broad discretion when evaluating whether an OCI exists.
GAO held that the record did "not establish any impropriety requiring Ball's disqualification for award, or otherwise indicate that the SSA had a conflict of interest that prejudiced the protester." The GAO went on to explain that the simple fact the SSA reports to the former Ball executive is inadequate to create a conflict of interest. The fact that neither the SSA nor the former Ball executive would financially benefit from Ball's selection as the awardee further demonstrates there is no conflict.
Key Lessons
The decision serves as a helpful reminder that establishing the existence of an OCI can sometimes prove difficult, particularly given the discretion afforded to agencies to evaluate OCIs and the sufficiency of mitigation plans. With that said, identifying one or more OCIs can be effective as protest grounds to the extent it is supported beyond mere inference or suspicion because once an OCI is established, it is presumed that the protester was prejudiced.
Also, while not mentioned in this GAO decision, violations of the Procurement Integrity Act (PIA) can be another effective ground for protest if the circumstances provide. The PIA prohibits the release of source selection and contractor bid or proposal information before the award of a federal agency procurement contract to which the information relates and bars federal officials from accepting compensation from contractors if they served in certain positions on a procurement action in excess of
Overall, the
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