Government Contracts Monitor

Pre-Award Departure of Proposed Project Manager: Is it a False Statement Not to Amend Your Proposal?

February 9, 2015

The United States Court of Appeals for the Sixth Circuit recently tackled the interesting issue of whether or not an awardee’s failure to modify its proposal prior to award – to reflect the pre-award departure of its proposed Project Manager – represents a false statement under the False Claims Act (FCA). Under the facts presented in United States ex rel. American Systems Consulting, Inc. v. ManTech Advanced Systems International (ASCI), the Court said “no”: Mantech’s failure to amend its proposal during the Best and Final Round of proposals, to reflect that its proposed Program Manger had left the company, was not considered “a material misrepresentation as a matter of law” in violation of the FCA. This decision presents an interesting contrast to the General Accountability Office’s (GAO’s) position on the need to amend proposals, recently reported here (beware-the-bait-and-switch).

In ASCI the incumbent disappointed bidder, after several rounds of protests that did not yield the desired results, resorted to filing a False Claims Act case in federal court alleging that ManTech made false representations to the government when it failed to correct its proposal to reflect that its Program Manager (PM) was no longer with the company. According to ASCI, the government evaluated ManTech’s proposal, and awarded the contract to ManTech, based upon the misrepresentation by ManTech regarding its PM – the qualifications of a PM who was a former, not current, employee of the company.

The Sixth Circuit disagreed, upholding the decision of the lower court that while the solicitation required offerors to identify the individual who would serve as the PM, and provide a copy of such person’s resume, the “government neither expected nor required that a designated individual ultimately perform as Program Manager, as a company’s employees were free to terminate their employment at any time.” The parallel requirement in the solicitation that if a contractor needed to replace its Program Manager, the replacement would be subject to the government’s approval, apparently signaled to the court that the “skill level, knowledge, and experience of the personnel that the bidder was capable of offering”, as evidenced by the PM proposed, was what the government evaluated and required to be maintained even if/when the identified individual departed.

Here the Court’s focus was entirely on whether the failure to modify the proposal to remove and replace the proposed PM was a material misrepresentation – not whether offerors are required to update their proposals in order to maintain technically complaint offers. Nonetheless, the Court’s approach to the unavailability of ManTech’s PM is in line with decisions of the Court of Federal Claims that proposal amendment may not be required, a position that conflicts with GAO precedent on this issue.

Lesson: If any key personnel proposed have departed, and there is an opportunity to submit a revised proposal or otherwise to amend the proposal, be sure to do so in order to avoid both the possibility of a non-compliant offer and a False Claims Act violation.

Attorneys

Lindsay Simmons