Loose Lips Sink Ships: Award Revoked for Relying on Inside Information from Former Navy Officials

We want to make something clear: simply having a former government official as an employee does not mean your company can’t bid on federal contracts or needs to let that person go. The government, while it puts certain restrictions in place, doesn’t forbid government contractors from hiring former government employees, and it can be very beneficial to have employees with such experience and still perfectly ethical. What it does forbid is when the company is or even just appears to be getting some sort of unfair advantage in acquiring contracts as a result of having former government workers as employees. For example, what if the contractor hires someone who was with the procuring agency and had access to information on competitors for an upcoming solicitation? This is the sort of thing that will result in awards being lost, as one company learned.

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Playing Games? GAO Requires NASA to Scratch $650 Million Contract Due to Foosball Snafu

While most of our get-togethers these days involve mask wearing, social distancing, and even virtual happy hours, spending time with friends is a great way to keep spirits light. Unfortunately for one group of friends, their weekly hangouts led GAO to conclude in its recent decision, Teledyne Brown Engineering, Inc., B-418835 (Sept. 25, 2020), that NASA had to cancel a more than $650 million deal and start the procurement process all over.

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GAO: Agency Didn’t Reasonably Evaluate a Potential OCI

In all competitive procurements, agencies must identify and analyze, as soon as possible, whether a potential contractor has an actual or potential organizational conflict of interest. (OCIs come in three general varieties: unequal access to information, biased ground rules, and impaired objectivity.) If the agency finds one, it must avoid, neutralize, or mitigate the potential OCI to ensure fairness.

As one recent GAO decision illustrates, an agency’s failure to reasonably investigate a potential OCI can lead to a sustained protest.

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