Change In Your Scope of Work (SOW)? Know What Costs You Can Seek in Your Request for Equitable Adjustment (REA)

Contractors for the United States Government (USG) sometimes encounter unforeseen circumstances that cause major obstructions and/or costs associated with their projects.  For example, maybe you have contracted for USG construction work, and half way through laying the foundation on the building, the Contracting Officer changes the type of cement he wants you to use. Or, maybe the Contracting Office suddenly shut down your access to the site for a month, leaving you and your subcontractors and vendors on standby and your materials on the site deteriorating beyond use. Or, maybe, you are starting to clear an area for a parking lot for the building, and you discover the site has landmines that neither you or the USG knew about.

Such incidents cause a contractor much concern because they create additional work that will cost you more money and delay your project delivery schedule.

If you find yourself in such a situation with a USG contract, you do not need to just accept the additional work and cost. Instead, you can ask for more money and/or time to complete the new or additional work. The process for asking for this additional money or time is called a Request for Equitable Adjustment (REA).  If you ask the USG Contracting Officer for an REA, the USG may agree to modify the contract to give you more time to do the work and to pay you more money for the additional cost related to the new or additional work.

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Where Can You File a Legal Complaint for Your Contracting Dispute?

If you are a contractor or subcontractor and have a dispute involving a United States Government (USG) project, you may be wondering what Court or other legal forum would be the proper place to bring a dispute or file a complaint.  Unfortunately, there is no quick answer, and the potential forum(s) for a legal complaint will depend on the contract, laws and factual circumstances involved.  This article will describe some of those factors.  Keep this in mind: there are usually some legal options and potential forums available for a USG- related contract dispute.  And if you are a contractor based outside the United States and your legal forum(s) for disputes are limited to Courts or agencies within the United States, you can still pursue your rights within a U.S.-based forum effectively and efficiently, without excessive travel, etc.

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Threatening You Will Hire An Attorney? There are Better Ways to Resolve Your Dispute

Are you in the middle of a dispute with a large organization, such as an agency of the U.S. government, or a prime contractor?  Is that party not being reasonable in the dispute, and causing you frustration?  If so, you may feel tempted to threaten you will get an attorney if your dispute is not resolved how you want.

Please know that making this threat– that you may get an attorney, rather than actually having one already representing you– is usually a bad idea.  Rarely does a large entity react to the threat the way you would want them to (i.e. rarely do they back down, give you what you want, etc.).   The large entity may react to an attorney threat in ways that make the situation worse for you.

Here are common negative reactions a large organization could make in response to an attorney threat:

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Subcontractor Files Lawsuit Against Parsons for Delay of Settlement Payment

The attorney-authors represent a subcontractor that recently filed a lawsuit against Parsons Global Services Inc.  and other Parsons entities (collectively referred to here as “Parsons”) in the Central District of California Federal Court.  Parsons was a primary contractor to the United States Government (USG) for construction work in Iraq.

The subcontractor that filed the lawsuit, Al-Marzoog Contracting Company (based in Iraq), alleges that Parsons unreasonably delayed settlement payments.  Al-Marzoog and Parsons had agreed to the settlement amounts years ago, but to date, Parsons has not paid Al-Marzoog, according to the lawsuit.

The lawsuit alleges Parsons has claimed it will not pay Al-Marzoog until the USG reviews the construction work matters and pays Parsons.  The lawsuit alleges that this “pay-when-paid” arrangement is unlawful because an unreasonable amount of time (years) has passed without payment.

For more details about the lawsuit, you can review the Complaint, posted below.

If you have a subcontractor settlement in which payment has been unreasonably delayed, please feel free to contact the blog-author attorney Vonda K. Vandaveer at vonda@vkvlaw.com or +1-202-340-1215.

Negligent Estimate Response and Reply Briefs (AGT v. U.S. Army)

The blog’s attorney authors wrote here about a contractor, AGT, which we represent before the Armed Services Board of Contract Appeals for a negligent estimate claim (and summary judgment motion) against the U.S. Army.  Here are links to the summary judgment response and reply briefs submitted thus far:

Negligent Estimate Summary Judgment Motion, AGT v. US Army

The blog’s attorney-authors represent a contractor in a case against the U.S. Army. The case is in litigation before the Armed Services Board of Contract Appeals (ASBCA), ASBCA No. 56758, Under Contract No. DABM06-03-C-0009.

The contractor we represent, American General Trading & Contracting (AGT), provided laundry services for U.S. Army soldiers in Iraq.  In the legal case, AGT alleges, among other issues, that the Army included negligent estimates in the parties’ contract that severely overestimated the amount of clothing items to be laundered.  Once the contract was performed, AGT had laundered substantially fewer laundry items than the average-item number estimated in the contract.

We recently filed a motion for summary judgment with ASBCA, trying to win the negligent estimate claim and other issues for AGT.  The summary judgment brief is below.

Problem with Government Contract Solicitation or Award Process? Consider Acting Immediately To Preserve Your Legal Rights

Act Now

The Situation: You bid on a big U.S. Government contract and just learned your competitor down the road won instead. You are shocked because this competitor just opened up for business a month ago, has no experience in contracting, and you heard they were even given a chance to revise and resubmit their bid, but you were never given that option. You’ve also seen this contractor hanging out in the same restaurants as the government’s contracting officer. You aren’t sure the award was unlawful, because you have no evidence, but you also aren’t sure the rules were properly followed. What can you do?

The Solution: You might be able to file a protest against the government agency that awarded the contract, but you should act immediately or you may lose your right to act, as some legal deadlines can pass very quickly.

Contractors who have lost bids and question the legality of the process, or who notice problems earlier in the process during the solicitation phase, before bids are even submitted, can file a protest in one of several forums, including federal courts, the relevant agency, or the General Accountability Office (GAO).

Each forum has its own rules and which one is best for you depends on your unique situation. Where you are located does not affect whether you may protest a government contract award. Whether you are in New York or Iraq, or Kuwait, or Germany, you may file a protest. An attorney can best evaluate whether you have a protest and where you should file.

The most important thing to remember, though, is you should consider acting quickly and contacting an attorney if you think you want to protest involving a solicitation or contract award. If you wait too long, you will lose your right to file a protest. For example, protests with the GAO involving the award itself must be filed within ten (10) days of the contract award. For protests involving the solicitation process before bids are submitted, the protest may have to be filed even before the proposal submission deadline.

The advantages of filing a protest in some cases include the government issuing a “stay” (an order sent to the government to stop issuance of a contract or an order sent to the winning contractor to stop work on the contract pending resolution of the protest).

If you win your protest, the remedies for a defective solicitation or contract award may include potential termination of the awarded contract, a re-bid of the contract, or a re-evaluation of the submitted bids and new award in accordance with the rules.

The attorney authors represent contractors in award protests against the U.S. government. For more information about our services for U.S. government contractors and subcontractors, see our Legal Services page or contact attorney-author Vonda Vandaveer at vonda@vkvlaw.com or (202)340-1215.

GAO Protest Win For Client: Army Agreed to Re-Evaluate Bids and Ordered to Pay Client Legal Fees

Some of our blog posts cover cases with contractors represented by the attorney-authors, including the case below.  The cases and articles we write serve as examples of the types of issues, settlements, awards, and verdicts obtained on behalf of our clients. The description below is not meant to explain all facets of the case, but to provide an idea of the type of contractor cases with which the attorney-authors have been involved.

 GAO Protest Win

Al Qabandi United Company; American General Trading & Contracting—Costs, B-310600.3,B-310600.4

Attorney Vandaveer obtained corrective action and attorney fees from the U.S. government on behalf of its client in Kuwait who protested the faulty award of a laundry services contract to another vendor. Ms. Vandaveer’s client, American General Trading & Contracting (AGT), along with another contractor, Al Qabandi United, filed protests involving this laundry contract, alleging the government failed to follow required bid evaluation procedures.

In response to the protests, the U.S. Army first attempted to seek dismissal, but was denied. Eventually, the Army agreed to take corrective action by re-evaluting the bids in accordance with required procedures.

Because the Army delayed taking corrective action, Ms. Vandaveer sought reimbursement from the U.S. government of her client’s attorney fees for pursuing the protest. The GAO granted the request and awarded AGT its protests costs. You can read a copy of the GAO decision here.

For more information about the legal services we provide to government contractors and subcontractors to primes, see our Legal Services page or contact us at vonda@vkvlaw.com.

Media Site Publishes Top 100 U.S. Government Contractors for 2012

Washington Technology media and information site has published a list of the top 100 contractors to the U.S. government. Click here to see the site’s list for 2012: http://washingtontechnology.com/toplists/top-100-lists/2012.aspx

Hint:  Despite KBR’s, DynCorp’s and Fluor’s extensive activities overseas under LOGCAP, none is No. 1.

The site also provides interesting analysis on the future of U.S. government contracting, taking into consideration mission needs and budget cuts.

 

 

Non-U.S. Contractor Dealing With a U.S.-Based Bully? There Are Rules (Laws) for the International Playground

English: A Bully Free Zone sign - School in Be...

If you are reading this blog, chances are that you may be part of a small- or mid-sized company that is not based in the U.S., and that you have contractual dealings with a large party– perhaps the United States Government (USG) or a large contractor– that is based in the United States.

If you run into a dispute with that large party, you may feel a bit, well… bullied, like the days of being a young child in the school play yard. Even if the U.S.-based bully does not insult you or your family, or take your lunch money (or your soccer ball), you still may feel the bully is pushing you around. For example, the USG or U.S.- based contractor may seem to be taking advantage of you based on its larger size and financial strength, its knowledge of U.S. laws and protocols, and so on.

However, much of a bully’s behavior is based on what you believe, as compared to the reality of the situation. In reality, you are stronger than you may think. There are several factors that can give you leverage against a U.S.-based bully, and equality on the international playground.

These leveraging factors can include:

  • Laws and legal rights that are available based on the language in your contract, and/or based on laws of the U.S. Federal Government or States.
  • A lawyer you hire to show the bully you are in a position of knowledge of your legal rights and the ability to pursue them.
  • The value of your goods, services and work, and the fact that treating you fairly (once you stand up for your legal rights) is in the best long-term interest of the USG or U.S.-based contractor interacting with you.

If you are dealing with a U.S.-based bully, its unfair conduct and even corruption can often be effectively addressed, even if this may not have been your experience with other companies or governments outside the United States.

If you want to know more about your contractor’s rights relating to a USG project, please feel free to contact us.

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