Awardee Relationship with Incumbent Does Not Create an OCI

(Editor’s Note. The following shows the advantage of teaming with former incumbents while making sure that potential conflicts of interests are adequately addressed.)

In its small business set-aside solicitation for a range of operational and administrative activities, ITP proposed to use Wackenhut, the incumbent who was a large business, as a subcontractor where it would retain a number of Wackenhut’s employees as key personnel on the contract. In its protest of the award to ITP, PAI asserted (1) the government improperly handled potential conflicts of interest issues due to Wackenhut’s access to information as the incumbent and (2) erred by considering the corporate experience of subcontractors when it gave ITP an “excellent” rating. The Court sided with the government on both assertions. It said the government properly addressed potential OCI issues and revised the solicitation to require that offerers certify their participation in the procurement did not give rise to any OCIs. It added that any advantage Wackenhut offered ITP was the result of experience rather than having access to nonpublic information received through its special relationship. As for improperly giving credit to Wackenhut’s prior performance history, the court ruled that the solicitation established a “contractor team arrangement” with subcontractors so the government could properly take Wackenhut’s experience into account (PAI Corp. v US, Fed. Cl., No. 09-04).

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