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Responsibility Determination Based on Legal Opinion Was Flawed

A negative responsibility determination was likely arbitrary, capricious, and an abuse of discretion, according to the Court of Federal Claims, because it was based on unwarranted conclusions regarding the protester's relationship with an affiliate. The post-award protester challenged the government's determination it was not eligible for award of a job order contract for construction services in Italy. The solicitation required offerors to submit an Italian certification for qualification of construction firms, and the protester, the Italian branch of the parent company, submitted the certificate of a subsidiary that had been debarred from government contracting. Based on an Italian legal opinion regarding the certification, the government concluded the protester was "relying on the technical capabilities and resources of a debarred firm ... to qualify itself and to execute work under this contract." The Government Accountability Office denied the protester's challenge to the responsibility determination (25 CGEN 113,153).

Core Legal Issue

However, the court found the requirements for injunctive relief were met and granted a preliminary injunction suspending performance and further issuance of task orders under the JOC. The government did not pass on to the Italian attorney the protester's representations the debarred firm would "have no links whatsoever with the awarding agency" and the protester was "absolutely capable" of performing the contract with its own requirements and resources. In addition, the government did not seek an opinion on the core legal issue, which was whether the protester could submit the affiliate's certificate while simultaneously disclaiming reliance on the affiliate's resources to perform the contract. Moreover, the opinion did not support the government's conclusion the protester was required to use the affiliate's resources as a matter of Italian law. It therefore was likely the government acted arbitrarily when it determined the protester was required to utilize and would utilize the resources of a debarred contractor. (Bilfinger Berger AG Sede Secondaria Italiana v. U.S., et al., FedCl, 55 CCF 79,481)




(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )


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