Relevant Cases

Protest of Laurels Medical Services, d/b/a Chariot, B-413047; B-413047.2; B-413047.3 (Aug. 8, 2016)

PilieroMazza successfully defended an award of a contract to our client by the U.S. Department of Veterans Affairs (“VA”) for special needs ground transportation services.  A competitor filed a protest of this award with the GAO, alleging that our client’s proposal did not satisfy certain solicitation requirements and that our client did not have the ability to perform the contract or the vehicles available to perform the contract.  We successfully argued that our client’s proposal satisfied the requirements of the solicitation, and that the VA reasonably determined the same.  We also demonstrated that the allegations regarding the availability of vehicles or our client’s ability to perform the contract were without merit.  GAO agreed and denied the protest, allowing our client to move forward with this important contract.

Tinton Falls Lodging Realty, LLC v. United States, Case No. 14-5140 (Fed. Cir. 2015)

PilieroMazza won an appeal before the U.S. Court of Appeals for the Federal Circuit, after earlier victories in the same case before SBA, SBA’s Office of Hearings and Appeals, and the U.S. Court of Federal Claims. The Federal Circuit appeal stemmed from an SBA size determination finding that our client was not affiliated with its subcontractor under the ostensible subcontractor rule.  Analyzing the solicitation and OHA’s decision, the Federal Circuit affirmed the Court of Federal Claims’ ruling because it found a rational basis in OHA’s determination that there was no ostensible subcontractor affiliation in this case.

SDVOSB Appeal of Robert F. Hyland and Sons, LLC, SBA No. VET-247 (2015)

PilieroMazza successfully defended our client’s service disabled veteran owned small business (SDVOSB) status in a SDVOSB and size status protest before the U.S. Small Business Administration (SBA). The U.S. Army awarded our client a construction contract under a SDVOSB set-aside procurement. A competitor protested our client’s size and SDVOSB status on the assumption that our client was unduly reliant on its proposed subcontract, in violation of the ostensible subcontractor rule. First, we successfully defended our client’s small business status. The protester then tried to use ostensible subcontractor arguments to assert that the service-disabled veteran did not control the company as required for SDVOSB eligibility. We successfully argued that the ostensible subcontractor rule does not apply in assessing veteran control of an SDVOSB, which contributed to SBA’s ruling that our client satisfied the veteran-control requirements for SDVOSB eligibility. SBA’s Office of Hearings and Appeals then confirmed SBA’s ruling on appeal.

The Gemini 3 Group, Inc. - Request for Reconsideration of an 8(a) Application

PilieroMazza successfully appealed SBA’s denial of Gemini 3 Group, Inc.’s (“G3G”) application for the 8(a) program. G3G’s owner had argued, in submitting her 8(a) application, that she was socially disadvantaged due to the gender bias she had faced throughout her career. The SBA disagreed that she was socially disadvantaged, because she did not belong to any of the groups presumed to be socially disadvantaged under SBA’s 8(a) regulations, and denied her 8(a) application, in part, on that basis. PilieroMazza assisted G3G with its request for reconsideration of its 8(a) application, and was able to successfully argue that SBA ignored, overlooked, and rejected relevant evidence in the record, failed to take reasonable inferences showing gender discrimination, and offered only vague or conclusory remarks in dismissing several incidents of discrimination that G3G’s owner reported. We were also able to demonstrate that G3G had the potential for success, given the owner’s qualifications, the Company’s financial health and successful record of performance on federal contracts. G3G was admitted to the 8(a) Program as a result.

Cherokee Nation Technologies, LLC v. United States, No. 14-371C (Fed. Cl. June 23, 2014) (order granting preliminary injunction)

PilieroMazza successfully delivered preliminary injunctive relief for its client in a bid protest action brought before the U.S. Court of Federal Claims (COFC).  Our client was the successful offeror on a U.S. Bureau of Indian Affairs (BIA) procurement acquiring information technology services.  After the incumbent contractor filed a U.S. Government Accountability Office (GAO) protest challenging our client’s award, the BIA canceled the solicitation, terminated our client’s contract, and issued a sole source award to the incumbent protester, all as part of a planned “corrective action,” which included the plan to reprocure the services with an increased scope of work at a future date.  Challenging the BIA’s actions on the basis of the improper nature of the sole source award and the scope of the corrective action taken in response to the incumbent’s GAO protest, the COFC agreed with PilieroMazza’s arguments that the BIA violated the law:  “In the court’s view, plaintiff has provided strong indication that both the award decision, and the associated corrective action here, were arbitrary, capricious, an abuse of discretion and otherwise contrary to law.”  The COFC enjoined the BIA from allowing the incumbent to continue performance on the sole source contract award, which forced the BIA to reprocure the services.  On the reprocurement, our client was once again able to successfully secure the contract award.

Tinton Falls Lodging Realty LLC v. United States, No. 14-353C, slip op. (Fed. Cl. July 8, 2014)

PilieroMazza successfully defended our client’s small business size status in a bid protest before the U.S. Court of Federal Claims (COFC).  The U.S. Navy awarded our client a contract requiring the prime contractor to coordinate and manage the lodging and transportation of numerous Civil Service Mariner trainees in New Jersey.  A competitor protested our client’s size, claiming that our client was unduly reliant upon its hotel subcontractor.  We successfully defended our client’s small business status before the U.S. Small Business Administration (SBA), leading the competitor to appeal to the SBA’s Office of Hearings and Appeals (OHA).  After PilieroMazza successfully defended SBA’s decision before OHA, the protestor then appealed OHA’s decision to the COFC.  Based on the deferential standard of review and the record before it, the COFC found no basis to question OHA’s decision.  Therefore, the COFC affirmed OHA’s ruling that our client is not affiliated with its subcontractor under the ostensible subcontractor rule and is eligible for the contract award.

Size Appeal of Crosstown Courier Service Incorporated, SBA No. SIZ-5571 (2014)

PilieroMazza successfully appealed a size determination in which the SBA erroneously found the protested firm to be an eligible small business.  The SBA did not examine affiliation through close family relationships, despite concluding that the protested firm and its alleged affiliate were owned and controlled by immediate family members.  On appeal, OHA agreed with PilieroMazza and held that the SBA should have more fully examined the family relationships and control by the family members in their respective firms.  As a result, OHA remanded the matter to the SBA for a new size determination.   

Size Appeal of Metis Technology Solutions, Inc., SBA No. SIZ-5538 (2014)

PilieroMazza delivered a victory for our client in this size appeal applying the newly organized concern affiliation rule.  The SBA’s Area Office determined that our client was affiliated with a very large government contracting entity due to the owner’s prior employment and managerial authority at the large entity, finding that she was a “key employee” of the large entity.  We appealed, and OHA reversed the Area Office’s decision, explicitly holding our client to be small under its size standard.  OHA found that the owner was not a key employee of the large concern, as she managed a very small portion of the large entity’s business. Moreover, OHA agreed with our analysis that the Area Office misunderstood the nature of what constitutes a key employee, stating that the Area Office’s finding that the owner had “critical influence or substantive control” over the large entity’s operations or management was not sustainable.

Size Appeal of Mali, Inc., SBA No. SIZ-5506 (2013)

PilieroMazza filed a size protest against a network of family-owned hotel companies in the Jersey Shore area. The SBA granted our protest and the protested firm filed an appeal with OHA. Rather than contest the affiliation findings, however, the protested firm’s appeal alleged that the area office lacked authority to issue the size determination because the procurement in question was a blanket purchase agreement (BPA). OHA agreed with our position that the solicitation was clearly for a requirements contract, not a BPA, and the SBA had authority to issue the size determination. Therefore, OHA confirmed that the protested firm was ineligible for the contract and the agency made award to the next in line, which was our client.

Basic Overnight Quarters, LLC, B-406964, October 9, 2012

PilieroMazza delivered a victory for a client challenging an indefinite delivery/indefinite quantity contract award, which resulted in a reevaluation of proposals and ultimately a contract award for our client. The Department of State had awarded our client’s competitors two contracts for long- and short-term temporary housing. The GAO agreed with PilieroMazza’s contention that the agency misevaluated our client’s proposal by improperly applying unstated evaluation criteria in its evaluation and by using perceived weaknesses in less important evaluation factors to assess weaknesses in unrelated factors. The GAO also agreed with PilieroMazza’s contention that the State Department evaluated offerors disparately by finding weaknesses in our client’s proposal that were unnoted in one of the awardee’s proposals. The GAO sustained the protest, holding that the State Department had unreasonably evaluated proposals and recommending that our client’s proposal be reevaluated and that it receive the costs incurred in its protest. After corrective action, the State Department made new awards, including one to our client.

Striker Electric, SBA No. BDPE-465 (2013), March 15, 2013; Admission to 8(a) Program, September 2013

PilieroMazza successfully appealed SBA’s denial of an application for the 8(a) program.  In March 2011, Striker Electric filed its initial 8(a) application stating that the owner was socially disadvantaged due to his physical disability.  At that time, not belonging to any of the groups presumed to be socially disadvantaged under the SBA’s 8(a) regulations, his application was denied.  In filing a request for reconsideration, our client provided additional testimony of bias yet SBA found that the applicant had not adequately demonstrated its social disadvantage as required for admission into the 8(a) Program.  An appeal was then filed with SBA OHA and, after reviewing the record, OHA granted our appeal that challenged the sufficiency of SBA’s denial.  The case went back to the SBA for a new determination, and SBA again denied Striker’s application.  PilieroMazza then assisted Striker with a new request for reconsideration to address SBA’s concerns.  In September 2013, SBA granted Striker’s latest request for reconsideration, admitting Striker into the 8(a) Program.

NAICS Code Appeal of Dial General Engineering, SBA No. NAICS-5375, July 10, 2012

PilieroMazza delivered a victory for a client before the SBA’s Office of Hearings and Appeals (“OHA”) in an appeal of a NAICS code designation.  In granting our appeal, OHA reversed a contracting officer’s (“CO’s”) decision to assign NAICS code 561730, Landscaping Services, with a corresponding size standard of $7 million, to a Department of Veterans Affairs solicitation.  OHA agreed with our arguments that the most appropriate NAICS code was 238110, Poured Concrete Foundation and Structure Contractors, with a corresponding size standard of $14 million.  Specifically, OHA found that the principal purpose of the procurement was for construction, not landscaping, as evidenced by the CLINs, the requirements for key personnel, and the contract clauses included in the solicitation.  As a result of OHA’s ruling, the work will now be available to firms that qualify as a small business under the $14 million size standard

Standard Communications Inc., B-406021, January 24, 2012

PilieroMazza recently delivered a victory for a client challenging a task order award to a competitor.  The U.S. General Services Administration, on behalf of the U.S. Department of Veterans Affairs, awarded our client’s competitor a task order for a complete digital/analog voice telephone system and related services for a VA medical facility.  The GAO agreed with PilieroMazza’s contention that the GSA engaged in discussions with the awardee, allowing the awardee to revise its proposal and lift its technical score from “unacceptable” to “acceptable” – even though our client was not afforded a similar opportunity to revise its own proposal.  The GAO sustained the protest, holding that the GSA’s actions constituted unequal discussions and was prejudicial to our client.

Size Appeal of SP Technologies, LLC, SBA No. SIZ-5319, January 20, 2012

PilieroMazza successfully appealed a size determination finding our client affiliated with another business based on the relationship between our client’s owner and her husband, a minority owner of the alleged affiliate.  The Area Office concluded that our client had not rebutted the presumption of affiliation between companies controlled by family members because the husband had previously worked for our client and because the husband’s company had provided most of our client’s revenues, before the wife resigned her position with her prior employer and began running our client as a full-time venture.

On appeal, OHA reversed the Area Office’s findings, agreeing with PilieroMazza that the size determination was flawed in multiple respects.  First, OHA held that the Area Office had erred by using the husband’s prior minority ownership of our client as evidence of a lack of clear fracture between the companies.  As OHA noted, size is determined as of a particular date, and as of the date in question, the husband was no longer a minority owner, nor had he been for some time.  OHA also held that the Area Office erred by using the history of revenues as evidence of a lack of clear fracture, because those revenues were generated before the wife began running our client as a full-time venture.  Finally, OHA held that even if the husband and wife had not demonstrated a clear fracture, the Area Office still would have committed error because it failed to address whether the husband controlled or had the power to control the alleged affiliate—a prerequisite for affiliation.  In fact, OHA indicated, another individual who owned a much larger interest in the alleged affiliate, but was not related to either the husband or wife, controlled it.

PilieroMazza recently delivered a victory for a client before the SBA’s Office of Hearings and Appeals (“OHA”).  OHA reversed the size determination issued by an SBA Area Office which found our client affiliated with a large contractor, its former mentor under the SBA’s 8(a) program.  The Area Office had found the two companies to be affiliated based on an identity of interest between our client’s sole owner and her husband, who was a former employee of the mentor but had not worked for the company for several years.  The case also involved the Area Office’s conclusion that only joint ventures are entitled to the exclusion from affiliation between mentors and protégés, but subcontracts and bonding assistance are not.  The Area Office then combined the familial identity of interest rule with the newly organized concern rule, finding that the 8(a) firm was a newly organized concern of the former mentor because the husband worked for the mentor at the time his wife formed the protégé.
On appeal, OHA reversed the Area Office’s findings on each alleged basis of affiliation.  First, OHA found that the Area Office clearly erred in basing its decision on circumstances outside of the three immediately preceding fiscal years; the Area Office had reached back to dealings as long as seven years ago.  Next, OHA found that the Area Office failed to afford the proper weight to the mentor-protégé agreement, which was in effect for the entire period for determining the 8(a) firm’s size and provides an exemption from affiliation based on joint ventures, subcontracts, and bonding assistance.  OHA found that the former mentor did not provide any assistance to the protégé that went “above and beyond” the type of assistance typically contemplated under such agreements.  Finally, OHA rejected the Area Office’s use of the familial identity of interest rule to create newly organized concern rule affiliation, for OHA found that the wife never worked for the former mentor and the Area Office also failed to analyze whether the protégé could be a newly organized concern several years after it was formed.

In an important victory for service-disabled veteran-owned (SDVO) firms, PilieroMazza helped to reverse an adverse SBA determination regarding the eligibility of an SDVO joint venture for a set-aside contract.  On appeal to the SBA’s Office of Hearings and Appeals (OHA), our attorneys challenged the SBA’s finding that an SDVO joint venture was ineligible for an SDVO contract because the joint venture was set up as an LLC.  The appeal argued that the SBA wrongly applied the SDVO regulations because the SBA ruled on the eligibility of the joint venture without discussing the specific SBA regulation that pertains to joint venture eligibility for contracting purposes.  The appeal also argued that two prior OHA decisions were wrongly decided because those cases found that a joint venture formed as a separate legal entity is treated differently under the regulations than a joint venture that is not formed as a separate legal entity.  In sustaining our appeal, OHA overturned its existing case law on this issue and ruled that the SBA’s regulations permit an SDVO joint venture to be formed as a separate legal entity.  As a result, SDVO firms and their joint venture partners may form joint ventures for SDVO contracts as separate legal entities such as an LLC, corporation, or partnership.

PilieroMazza successfully appealed a decision of the SBA’s Area Office finding a competitor of PilieroMazza’s client to be a small business.  In its decision, the SBA’s Office of Hearings and Appeals agreed with PilieroMazza’s contention that the competitor’s ongoing bankruptcy did not exempt it from affiliation with other businesses controlled by the bankruptcy trustee.   The Office of Hearings and Appeals further agreed with PilieroMazza that the competitor and three other companies were affiliated by virtue of common management.  As a result of the successful appeal, OHA vacated the SBA’s decision finding the competitor to be an eligible small business.

Size Appeal of Innovative Construction & Management Services, LLC, SBA No. SIZ-5202, February 18, 2011

PilieroMazza successfully appealed an adverse SBA size determination to the SBA’s Office of Hearings and Appeals (“OHA”), enabling the appellant to resume self-certifying as small for government contracts.

The appeal arose out of an SBA Area Office decision, analyzing the appellant’s size for purposes of its 8(a) application.  The Area Office found that the appellant was small as of the date of its application, but not small as of the date the Area Office issued the size determination.  In reversing the Area Office’s decision, OHA agreed with PilieroMazza the applicable regulation did not permit the Area Office to evaluate the appellant’s size as of the date of the size determination.  For 8(a) purposes, size is to be evaluated on two precise dates: the initial application date, and the date of certification as an 8(a) participant.  Because the appellant had not yet been certified as an 8(a) participant, the only relevant date, for size purposes, was the date of the appellant’s application, for which the appellant had already been found to be a small business.  OHA held that by also evaluating the appellant on the date of the size determination, the Area Office committed a clear error of law.

Delex Systems, Inc., GAO B-400403, October 8, 2008

PilieroMazza represented a protester in its successful and well-publicized bid protest to the U.S. Government Accountability Office (GAO).  This protest was the first of its kind under the GAO's new authority to hear protests of task orders valued in excess of $10 million.  Ruling in our client's favor, the GAO established significant precedent for the application of small business set-aside requirements to task orders

The protest alleged that the agency (1) failed to comply with the set-aside provisions of Federal Acquisition Regulation (FAR) § 19.502-2(b), when issuing, on an unrestricted basis, the solicitation for a delivery order under multiple-award contracts; and (2) erred in concluding that it had no reasonable expectation of receiving offers from two small businesses is sustained where the record shows that the agency's set-aside determination is not adequately supported by the record.  In sustaining the protest, GAO specifically determined that the set-aside provisions of the FAR apply to competitions for task and delivery orders issued under multiple-award contracts.