News for the Week of May 22, 2017

Legal News: Major Contract Awards:
Legal News:

Costs Were Not Expressly Unallowable and Subject to Penalty
A contractor's appeal from a government claim imposing penalties for expressly unallowable costs was sustained in part by the Armed Services Board of Contract Appeals because the costs included in the contractor's corporate incurred cost rate proposal were not expressly unallowable and therefore not subject to a penalty. The challenged costs included aircraft fractional lease costs, costs for an aircraft used by the contractor's CEO, and costs to design a database for mergers and acquisitions and divestitures. (Raytheon Co., ASBCA, ¶95,158)

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Attorney Sanctioned for Improper Removal of Contract Documents
A contractor's attorney was publically reprimanded by the full Civilian Board of Contract Appeals because his removal of the government's contract documents from the board's courtroom interfered with the administration of justice and impeded the orderly and expeditious disposition of the appeals. The attorney's decision to remove drawings from opposing counsel's table and transport them out of the courtroom and the building without permission, his failure to promptly return the documents in the same condition as removed, and his shifting justifications for his actions warranted some sanction. (Suffolk Construction Co. v. GSA, CBCA ¶95,151)

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Evaluations Were Inconsistent with RFP, Inadequately Documented
A protest of a contract award for financial operations services was sustained because the past performance evaluation, the price evaluation, and the best-value tradeoff decision were unreasonable, inconsistent with the terms of the request for proposals, and inadequately documented. Nothing in the "limited" record explained or otherwise justified the deficiency under the past performance factor, and the record was "devoid of any contemporaneous documentation whatsoever showing that the [government] evaluated ... prices consistent with [the Federal Acquisition Regulation] and the explicit terms of the [RFP]." (Verdi Consulting, Inc., 32 CGEN ¶115,529)

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No Evidence Government Resolved Employee Retention Concerns
A protest of a contract award for safety and mission assurance support services was sustained because the evaluation under the mission suitability factor and the cost realism analysis were unreasonable. The RFP provided for a FAR 52.222-46 assessment of professional employee compensation and a cost realism analysis, but the Comptroller General found nothing in the record explaining how the government concluded the awardee would be able to retain a high percentage of the incumbent employees at the compensation offered. (A-P-T Research, Inc., 32 CGEN ¶115,526)

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Major Contract Awards:

Rotary Wing Airlift Services — $949 Million
AAR Airlift Group Inc., Palm Bay, Florida; Construction Helicopters Inc., doing business as CHI Aviation, Howell, Michigan; and Columbia Helicopters, Aurora, Oregon, have been awarded indefinite-delivery/indefinite-quantity, fixed-price contracts to provide rotary wing airlift services, which support the U.S. Central Command area of responsibility. The total value of the rotary wing program through fiscal 2021 is $948,817,666. The contracting activity is the U.S. Transportation Command, Directorate of Acquisition, Scott Air Force Base, Illinois.

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AH-64 Apache Helicopters — $488 Million
The Boeing Co., Mesa, Arizona, was awarded a $488,076,762 modification to a foreign military sales (United Kingdom) contract for the remanufacture of 38 AH-64 Apache aircraft, and to procure three Longbow crew trainers and associated spares. U.S. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity.

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Water Well Drillers — $378 Million
Kipper Tool Co., Gainesville, Georgia, has been awarded a maximum $377,500,000 fixed-price with economic-price-adjustment contract for water well drillers. This is a five-year contract with no option periods. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania.

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Research & Development — $332 Million
Northrop Grumman Space & Mission Systems Corp., Colorado Springs, Colorado, is being awarded $332,000,000 for a modification to the Joint National Integration Center Research and Development contract to increase the estimated maximum from $3,850,000,000 to $4,182,000,000 and extend the period of performance of task orders. The Missile Defense Agency, Schriever Air Force Base, Colorado, is the contracting activity.

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Missile Defense Radar — $327 Million
Raytheon Co., Marlborough, Massachusetts, is being awarded a $327,146,998 fixed-price-incentive (firm target) modification to a previously awarded contract to exercise options for Air and Missile Defense Radar low-rate initial production. The Naval Sea Systems Command, Washington, District of Columbia, is the contracting activity.

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Food Distribution — $301 Million
USFI Inc., Gardena, California, has been awarded a maximum $301,000,000 firm-fixed-price, indefinite-delivery/indefinite-quantity contract for full food line distribution. This is a five-year bridge contract, inclusive of a six-month ramp up period, with no option periods. The contracting activity is the Defense Logistics Agency Troop Support, Philadelphia, Pennsylvania.

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About this Newsletter

From Wolters Kluwer Legal & Regulatory's Government Contracts editors, here are summaries of the important recent developments in this practice area. Complete coverage of these issues, and more, appears in Government Contracts Reports, the Government Contracts Reporter, and related CCH products.



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Federal Acquisition Regulation (FAR) & Department of Defense FAR Supplement (DFARS), January 2017 Combo