United States: Bad Faith And Biased Procurement Officials (Post-Award Protest Primer #16)

Last Updated: May 17 2018
Article by Daniel E. Chudd and James A. Tucker

We previously have referred in passing to Government bad faith as a protest ground that almost never is worth raising. Today, we'll address this rarely successful protest ground and discuss why it's almost always a loser, as well as the rare circumstances in which it may lead to a sustained protest.

When an offeror loses a competition, it sometimes blames the loss on biased Government officials. Maybe it thinks the contracting officer loves the incumbent and put his thumb on the scale to help the incumbent out. Maybe it thinks the contracting officer hates the incumbent and skewed the evaluation in favor of new blood. Maybe the source selection authority was hopelessly biased because his cousin's sister-in-law is godmother to the awardee's assistant program manager. Once in a while, we've even seen evidence that suggested that a Government official probably did act in bad faith in a procurement. Even then, though, our advice generally is not to raise suspected bias and bad faith as a protest ground.

Here's why. Although the GAO (and the Court of Federal Claims) will consider allegations of bad faith, the protester's burden of proof is almost impossibly high: "[G]overnment officials are presumed to act in good faith, and a protester's contention that procurement officials are motivated by bias or bad faith must be supported by convincing proof; our Office will not consider allegations based on mere inference, supposition or unsupported speculation." Hewlett Packard Enter. Co., B-413444.4; B-413444.5, Jan. 18, 2017, 2017 CPD ¶ 29 at 7 n.5 (emphasis added). "To establish bad faith, a protester must present convincing evidence that agency officials had a specific and malicious intent to harm the firm." Trailboss Enters., Inc., B 415812.2 et al., May 7, 2018, 2018 CPD ¶ __ at 12 (emphasis added). Or, to use an older formulation of the same ridiculously high standard: "[T]he record must show 'well-nigh irrefragable proof' that the agency had a malicious and specific intent to injure the party alleging bad faith." Delta Data Sys. Corp., B 213396, Apr. 17, 1984, 84-1 CPD ¶ 430 (quoting Kalvar Corp. v. United States, 543 F.2d 1298, 1301 (Ct. Cl. 1976)) (emphasis added).

The presumption of good faith means that, right out of the gate, the GAO has decided that the procurement officials were not biased and did not act in bad faith. To rebut that presumption, the protest has to produce evidence that agency officials specifically set out to harm the protester – not merely that they took an action that, as collateral damage, happened to harm the protester. And the protester's evidence must be "convincing" and "well-nigh irrefragable proof." This is not a "more likely than not" standard. It essentially requires the protester to present hard facts that basically admit of no other rational explanation but that the agency official was out to get the protester.

What does it take to prove bad faith or bias? A criminal conflict of interest might do it. Lockheed Martin Corp., B-295402, Feb. 18, 2005, 2005 CPD ¶ 24 is one of the few protests sustained on the basis of bad faith and bias. Following Darlene Druyun's criminal conviction for violating conflict-of-interest provisions and steering Air Force awards toward Boeing, Lockheed Martin protested a contract awarded to Boeing years earlier. The GAO found that Ms. Druyun's demonstrated bias in favor of Boeing prejudiced Lockheed Martin (despite the Agency's arguments that her involvement in the procurement was not "significant") and recommended that Phase II of Boeing's contract be competed. Similar protests based upon Ms. Druyun's involvement in the C-130 avionics modernization upgrade program also resulted in victory for the protesters, years after the contract was awarded to Boeing. See Lockheed Martin Aeronautics Co. et al., B-295401 et al., Feb. 24, 2005, 2005 CPD ¶ 41. These rare victories are very much outliers.

Apart from a situation where a procurement official has been convicted of rigging procurements, and in the absence of unambiguous, black-and-white proof of prejudicial bad faith, it usually is not advisable to allege bad faith and bias. The odds of losing that protest ground are astronomically high, even if the official really is biased. The odds of gravely offending a customer or potential customer are also very high. Agency counsel and intervenors – who know bad faith and bias are nearly impossible to prove in a protest – are probably the only ones who like allegations of bad faith: they are sure to latch onto those allegations to make the protester look silly and call into question the credibility of its remaining protest grounds.

Finally, as we've noted before, competitive prejudice is an essential element in every protest. That is, even in the unlikely event a protester can convince the GAO that one or more agency officials acted in bad faith or were biased against the protester, the protester also must show that it had a substantial chance of being awarded the contract but for the bad faith. If the biased official was not in a position substantially to alter the source selection decision, or if other issues unrelated to bias would have independently prevented you from winning the competition, proving bad faith won't do you any good.

Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Morrison & Foerster LLP. All rights reserved

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