Government Contracts Lawyer & Attorney : Sheppard Mullin Law Firm : Bids, Licenses, Awards, Conflict of Interest.

The Court of Federal Claims' most recent decision in Axiom Resource Management v. United States, 2008 WL 541675 (Feb. 26, 2008) ("Axiom II"), suggests that extended judicial oversight of contract administration functions may be a viable bid protest remedy, particularly in the context of organizational conflicts of interest (OCIs).  The case also highlights the importance of preparing and implementing an OCI mitigation plan that will withstand rigorous judicial scrutiny, during the proposal phase, so that the Government's and the offeror's apparent front end indifference to the issue of OCIs does not jaundice the court's views with respect to their willingness or inclination rigorously to implement a mitigation plan to which they were dragged "kicking and screaming."

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• Do understand the OCI rules and the different categories of OCIs.
• Do be particularly attuned to "impaired objectivity" OCIs.
• Do think broadly - OCIs are created at a company-wide level, not simply a division or sector level.
• Do consider the long-range business plan for a particular procurement; be aware that winning a small, preliminary award could create conflicts on a massive, future award.
• Do be aware of the potential restrictions on follow-on contracts that may accompany SETA work.
• Do not simply ignore an institutional competitive advantage when preparing a proposal.
• Do ensure that every proposal considers and, as required, implements an OCI mitigation plan.

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The Court of Federal Claims’ recent decision in Axiom Resource Management v. United States, 2007 WL 2840414 (Sept. 28, 2007), illustrates the trend toward more robust judicial review of organizational conflict of interest (OCI) allegations. The case also highlights several issues contractors should consider in drafting successful OCI mitigation plans.

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