Technatomy v. U.S.: VA Contract Awards Face Legal Challenge

The case of Technatomy Corp. v. United States, decided by the United States Court of Federal Claims in 2024, addressed significant issues in government procurement. It delved into bid protests involving the Department of Veterans Affairs (VA) and its decisions related to the Transformation Twenty-One Total Technology Next Generation Two (T4NG2) contract.

Background of the Case

The T4NG2 contract was a large-scale initiative by the VA aimed at overhauling its information technology systems. With a projected ten-year value of $60.7 billion, the contract sought to address various IT needs, including software, hardware, and cybersecurity services. The VA issued a solicitation in March 2023, later revised, and received 173 proposals.

The solicitation specified that up to thirty contracts would be awarded based on the highest-rated proposals, incorporating reserved slots for small businesses, service-disabled veteran-owned small businesses, and historically underutilized business zones. Ultimately, the VA awarded contracts to the thirty highest-rated offerors. However, this decision sparked protests from Technatomy Corp. and other unsuccessful bidders, leading to consolidated litigation involving over thirty plaintiffs.

Legal Issues

The case raised several legal questions about the VA’s procurement and evaluation processes, including:

1. Number of Awards: Plaintiffs argued that the VA arbitrarily limited the awards to thirty contracts, despite the solicitation allowing for more flexibility.
2. Evaluation of Small Business Participation: Several plaintiffs contended that the VA failed to adequately evaluate commitments to small business participation.
3. Validation of Veteran Employment Claims: Challenges were made regarding the VA’s assessment of veteran employment figures provided by offerors.
4. Joint Venture Eligibility: Plaintiffs questioned the eligibility of certain joint ventures under service-disabled veteran-owned small business criteria.
5. Proposal Disqualification: Specific offerors, like Tribility LLC, contested their disqualification due to procedural errors in their proposals.

Court’s Analysis and Decision

The court addressed the above issues, leading to a mixed outcome for the plaintiffs:

• Number of Awards: The court upheld the VA’s decision to limit awards to thirty, emphasizing that the solicitation’s terms were clear and allowed discretion in determining the number of awards.
• Evaluation of Small Business Participation: The court allowed challenges regarding the evaluation process, stating that these issues warranted further examination to determine compliance with the solicitation.
• Validation of Veteran Employment Claims: The court found that the VA had an obligation to perform a meaningful review of veteran employment claims and denied motions to dismiss these challenges.
• Joint Venture Eligibility: The court dismissed challenges related to joint venture eligibility, confirming that the solicitation required only the managing partner of a joint venture to be certified as a service-disabled veteran-owned small business.
• Proposal Disqualification: The court upheld the disqualification of Tribility LLC, ruling that its failure to designate a responsible manager constituted a material noncompliance with solicitation requirements.

Conclusion

Technatomy Corp. v. United States highlighted the complexities of federal procurement and bid protests. While the court supported the VA’s discretion in some areas, it underscored the need for thorough and transparent evaluation processes. This ruling serves as a critical reference for businesses navigating federal contract solicitations and protests.

Our Legal Expertise

At Whitcomb, Selinsky, PC, we specialize in assisting businesses with federal procurement challenges. Our experienced team stays informed on key rulings to provide the best legal guidance. Contact us today to discuss your legal needs.