• Contractor Employee Not Required to Arbitrate Tort Claims
• "Excellent" Past Performance Was Worth Higher Price

• SBA Amends HUBZone Definition of "Employee"
• EAR Amended to Reflect Changes to Missile Control Regime

• All Terrain Vehicles - $438 Million
• Scientific and Engineering Support Services - $287 Million
• Software - $241 Million
• Construction - $194 Million
• Trucks - $172 Million

GAO Finds Fraud And Abuse in SDVOSB Program

An October 23, 2009, report issued by the Government Accountability Office finds fraud and abuse in the service-disabled veteran-owned small businesses program allowed ineligible firms to improperly receive millions of dollars in set-aside and sole-source SDVOSB contracts and potentially denied legitimate SDVOSB firms the benefits of the program. In 10 cases selected by the GAO for review, firms that did not meet SDVOSB requirements received approximately $100 million in SDVOSB contracts, and $300 million in other government contracts. The GAO's investigation revealed misrepresentations by: a firm whose owner was not a service-disabled veteran; a serviced-disabled veteran who did not control the firm’s day-to-day operations; a service-disabled veteran who was a full-time contract federal employee at a military base; and firms that served as a “pass-through” for large and sometimes foreign-based corporations.

In concluding the program lacks effective fraud-prevention controls, the GAO found agencies do not have processes for validating a firm’s eligibility for the program or a database of individuals who are service-disabled veterans. Moreover, according to the GAO, firms found to be ineligible do not face real consequences, can be allowed to complete their contracts, and are not suspended or debarred. The report recommends the government consider using an existing Department of Veterans Affairs database called "VetBiz" to validate all SDVOSB-eligible firms, and debarring contractors who knowingly misrepresent their status as an SDVOSB. For the text of the report, see: http://www.gao.gov/cgi-bin/getrpt?GAO-10-108. Related testimony, dated November 19, 2009, can be found at: http://www.gao.gov/cgi-bin/getrpt?GAO-10-255T.

Contractor Employee Not Required to Arbitrate Tort Claims

Tort claims brought by an employee against a contractor did not fall within the scope of the parties' arbitration agreement, according to the Court of Appeals for the Fifth Circuit, because the employee's sexual-assault allegations did not relate to or concern matters associated with her employment. Despite the contractor's argument the alleged incident was related to employment, which would have mandated binding arbitration, the court declined to adopt the contractor's expansive interpretation of the arbitration clause. Instead, the court found the employee was not acting in any way related to her employment by being the alleged victim of a sexual assault perpetrated by co-workers who were violating the contractor's policies. (Jones, et al. v. Halliburton Co., et al., CA-5, 53 CCF ¶79,192) [full story]

"Excellent" Past Performance Was Worth Higher Price

A challenge to a best value award for dry dock repairs was rejected because the government made reasonable past performance assessments and determined the awardee's more relevant performance was worth the higher price. The Comptroller General denied the protest, finding the past performance evaluation was reasonable and consistent with the solicitation. (Commissioning Solutions Global, LLC, 24 CGEN ¶112,949) [full story]

SBA Amends HUBZone Definition of "Employee"

The Small Business Administration has issued a final rule amending the Historically Underutilized Business Zone program's definition of the term "employee." The final rule amends SBA 126.103 to provide that "[e]mployee means all individuals employed on a full-time, part-time, or other basis, so long as that individual works a minimum of 40 hours per month." For the text of the rule, effective May 3, 2010, see ¶70,425.383. [full story]

EAR Amended to Reflect Changes to Missile Control Regime

The Bureau of Industry and Security has issued a final rule amending the Export Administration Regulations to reflect changes to the Missile Technology Control Regime accepted by MTCR member countries at the November 2008 Plenary in Canberra, Australia. Specifically, the rule amends the Commerce Control List (Supplement No. 1 to EAR 774.1) to reflect the MTCR Annex changes. For the text of the rule, effective November 9, 2009, see ¶72,750.176.[full story]

All Terrain Vehicles - $438 Million.

Oshkosh Corp., Oshkosh, Wis., was awarded on November 10, 2009, a $438,440,000 firm-fixed-price contract for 1,000 Mine Resistant Ambush Protected, All Terrain Vehicles (M-ATVs) and associated basic items of issue (BII) with an option for 400 M-ATVs and BII. U.S. Army TACOM Contracting Center AMSTA-TAC-ATBC, Warren, Mich., is the contracting activity. [full story]

Scientific and Engineering Support Services - $287 Million.

ManTech International Corp., Chantilly, Va., was awarded on November 9, 2009, a $286,541,415 cost-plus-award-fee contract for the scientific and engineering support services in support of the U.S. Army Electronic Proving Ground, Fort Huachuca, Ariz. Information Technology, E-Commerce and Commercial Contracting Center, Division C, Fort Huachuca, Ariz., is the contracting activity. [full story]

Software - $241 Million.

Raytheon Co., Integrated Defense Systems, Tewksbury, Mass., is being awarded a $241,270,876 modification to previously awarded contract for completion of Total Ship Computing Environment software for the DDG 1000 Zumwalt Class Destroyer Program to meet lead ship integration and construction schedules. The Naval Sea Systems Command, Washington, D.C., is the contracting activity. [full story]

Construction - $194 Million.

Kiewit Louisiana Co., Fort Worth, Texas, was awarded on November 6, 2009, a $194,463,128 firm-fixed-price contract for Lake Pontchartrain & vicinity Hurricane Protection Project, fronting protection and breakwater modification, Jefferson lakefront, Pumping Stations No. 1 through 4, Jefferson Parish, La. U.S. Army Corps of Engineers, New Orleans District, New Orleans, La., is the contracting activity. [full story]

Trucks - $172 Million.

Navistar Defense LLC, Warrenville, Ill., was awarded on November 6, 2009, a $171,640,345 firm-fixed-price contract for 783 petroleum/oil/lubricant trucks and 59 water trucks. U.S. Army TACOM LCMC, AMSCC-TAC-ADBA, Warren, Mich., is the contracting activity. [full story]

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