In my earlier blog post on the GAO’s decision in VSE Corporation (B-404833.4, November 21, 2011), I commented on GAO case law holding that “an appearance of impropriety” can justify the disqualification of a contractor from a procurement. In the VSE case, the GAO, in fact, did not uphold the Contracting Officer’s determination that VSE’s consulting relationship with a former Army Deputy Program Manager created “an appearance of impropriety.” Much of the case discussed the facts cited by the Contracting Officer to support her finding of “an appearance of impropriety.” Much of the case also addressed one fact the Contracting Officer ignored: the opinion provided by an Army ethics counselor stating that the former Deputy Program Manager could work “behind the scenes” with contractors submitting proposals for work on the program.
Most contractors are aware that there are “post-employment restrictions” for Government employees, also known as “revolving door” rules. Us government contract lawyers know that, when in doubt, a contractor should have a former government employee get an ethics opinion from the agency before establishing a consulting/employment relationship with the contractor who does, or intends to do, work for the same agency. In this case, it appears VSE did the right thing and that the Deputy Program Manager was permitted to assist VSE in developing its proposal for the Army requirement. That opinion should have been pretty persuasive in this case, don’t you think?
The Contracting Officer did not think so. Apparently, she was troubled by the term “behind the scenes.” At the hearing during the protest, she testified that she didn’t know what that term meant and that it was “vague” and “undefined” in the ethics opinion. The GAO did not share her concern and concluded that the Contracting Officer’s understanding of the government post-employment restrictions was not consistent with the applicable statutes and regulations.
Here are the issues. Generally speaking, former government employees at certain levels and that have participated “personally and substantially” in certain procurement matters are prohibited from taking employment with a Government contractor for a prescribed period where they will be communicating with the Government on behalf of the contractor. The reason for these rules is fairly obvious – the former employee’s status makes it more likely that he or she will unfairly influence government action in favor of the contractor. (I know what you cynics out there are saying – isn’t that the reason the former government employee was hired in the first place?)
The conduct prohibited by the post-employment restrictions is “communication” with the Government on behalf of another entity. Communication in this regard includes transmission of information of any kind, orally, in written correspondence, by electronic means and by any other means. Notably, the post-employment restrictions include the “physical presence” of the former Government employee before a Government employee, even if the former Government employee does not make any verbal or written communication.
The post-employment restrictions, however, do not prohibit “behind-the-scenes” work by a former Government employee for a contractor – provided that such employment does not include “communications” or an “appearance” before a Government employee – at least for the period prescribed by the regulations. The regulations actually list various examples of the types of communications and post-employment activities that fall within and outside the post-employment rules. Some of these examples include examples of “behind-the-scenes” work. Had the Contracting Officer looked at the actual post-employment rules and read these examples, she likely would have realized that the ethics opinion from the Army was right on point.
Curiously, the GAO did not focus on an aspect of the regulation that I think is critical in this case and for contractors seeking to comply with these post-employment restrictions. The Contracting Officer testified that the alleged prohibited communication to the Government was the proposal submitted by VSE. The communications that are prohibited by the post-employment restrictions, however, are those by a former Government employee to another Government employee. That did not occur here. More importantly, the restrictions only apply to communications which are intended to be attributed to the former Government employee. Without such attribution, there really isn’t the potential of improper influence.
In this context, with or without an Army ethics opinion, it is fairly clear, at least to this government contracts attorney in Northern Virginia, that VSE’s proposal, unless it quoted or otherwise highlighted VSE’s relationship with the former Deputy Program Manger (which it didn’t), does not qualify as a prohibited “communication.”
The Contracting Officer should have reviewed the post-employment restrictions. Even if she wasn’t going to do so, she should have checked with her Army counsel. In fact, FAR Part 9 advises Contracting Officers to “obtain advice of counsel and the assistance of appropriate technical specialists in evaluating potential conflicts.” FAR 9.504(b). Which brings me to this question – why wasn’t the Army ethics opinion dispositive (assuming, or course, that the former Deputy Program Manager acted in accordance with the opinion)? And why didn’t the CO try to discuss the issue with him? Seems like the right hand didn’t know what the left hand was doing here. And why did Army lawyers go on to defend the protest when she was pretty clearly in the wrong? Shocking. Not.