Filing a size protest requires more than just pointing the finger at the protested concern and hoping SBA decides to investigate further. The protest must contain at least some level of specific information that demonstrates why the protested concern is other than small.
SBA regulations, in particular, require that the size protest be “sufficiently specific to provide reasonable notice as to the grounds upon which the protested concern’s size is questioned.” 13 C.F.R. § 121.1007(b). The protest should provide a basis for the belief or allegation. In other words, the protester can’t simply allege a concern is other than small or affiliated without providing specific information to support the claim. SBA warns that a protest lacking “sufficient specificity” will be dismissed.
Now, it doesn’t happen too often, but a recent decision shows that SBA will dismiss protests when it finds the initial support to be lacking.
In C4CJV, LLC, Appellant, SBA No. SIZ-6362, 2025 (July 28, 2025), C4CJV, LLC (Appellant) argued that the Area Office erred in dismissing a size protest on the grounds of non-specificity.
Appellant was an offeror for a U.S. Department of Navy procurement under North American Industry Classification System (NAICS) code 518210, Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services, with a corresponding $40 million size standard.
The contract was awarded to PCG-SMX JV, LLC (Awardee), a mentor-protégé joint venture between Smartronix, LLC (Smartronix) and Perrygo Consulting Group, LLC (Perrygo).
Appellant filed a size protest against Awardee, alleging that Perrygo and Smartronix had a long-standing relationship prior to executing an MPA.
The protest alleged that Perrygo had been economically dependent on Smartronix and the concerns were affiliated based on identity of interest. A concern is economically dependent upon another (and thus presumed affiliated) if the concern derives 70% or more of its receipts from another concern over the previous three fiscal years. 13 C.F.R. § 121.103(f)(2).
Appellant alleged affiliation based on the subcontracts Perrygo received from 2019 to 2022, noting the following:
- 100% of Perrygo’s subcontracts were from Smartronix in 2019;
- six of the eight subcontracts Perrygo was awarded in 2020 were from Smartronix;
- 100% of the subcontracts awarded to Perrygo in 2021 were from Smartronix; and
- three of the five subcontracts awarded to Perrygo in 2022 were from Smartronix.
The precise amount of revenue from the subcontracts was not provided. But Appellant argued that on information and belief, the revenue from the subcontracts exceeded 70% of Perrygo’s revenue.
The Area Office dismissed the protest, finding there was insufficient evidence or documentation to support the allegations. Specifically, the Area Office noted that the revenue used to calculate whether there was affiliation due to identity of interest upon economic dependence should have been from 2021-2023. Appellant only provided documentation for 2019-2022.
Additionally, the documentation only stated the value of the prime contracts, rather than the exact amounts Perrygo received as subcontractor. The Area Office found that this evidence alone was not specific enough to support the allegation that Perrygo received 70% or more of its receipts from Smartronix from 2021 to 2023.
Appellant appealed, arguing that the Area Office erred in ignoring the fact that Perrygo and Smartronix were affiliated prior to executing the MPA in 2023.
When considering non-specific protests, SBA’s Office of Hearings and Appeals (OHA) will “consider whether (1) the protest was sufficiently specific to provide notice of the grounds upon which the protestor was contesting the challenged firm’s size; and (2) whether the protest included factual allegations as a basis for these grounds.”
OHA agreed with the Area Office, finding “Appellant’s protest did not raise specific, credible evidence that PCG-SMX was other than small on the basis of identity of interest.”
A concern alleging identity of interest due to economic dependence is required to show that the protested concern derived 70% or more of its receipts from another concern over the previous three fiscal years. The protested concern’s size is determined as of the date of initial offer, which was May 6, 2024. Thus, the three prior fiscal years were 2021-2023. Appellant’s protest did not include revenue for the entirety of the three fiscal years.
OHA stated that “Appellant cited to the wrong fiscal years in its protest.” It appears that OHA is saying, if the protest had included the year 2023 instead of 2022, the protest might have survived dismissal. So, it’s possible that one numeral may have decided the fate of this size protest.
Further, even if the information from 2019-2022 was true, OHA noted that it would not constitute a basis for challenging Perrygo’s size because the information did not contain specific credible facts demonstrating a size violation.
This decision may reflect a more heightened evidentiary standard than is sometimes used by the SBA. For instance, our firm has seen many dismissal motions denied even when the size protest was quite skimpy. Although, it’s hard to tell from one decision if this is a trend or merely the circumstances of one particular protest.
SBA understands that publicly available information does not always reveal everything the protester is trying to allege against another concern. But the protester has to bring more to the table than just an accusation. The protest should include specific facts and adequate documentation to support the allegations. Even more so than in the past, it seems that protesters must provide a litany of documentation to support all of its allegations, or risk dismissal. On the flip side, those receiving a protest might consider requesting dismissal as an initial response to a size protest. It just might work.
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