How to Avoid Costly Contractor Teaming Agreement Mistakes in a Bid Protest
When submitting a government proposal, you may choose to submit a contractor teaming agreement to show evidence of relationships with another subcontractor. Yet, a question arises in a bid protest whether your teaming agreements were sufficiently evaluated by the Source Selection Authority (SSA). Drafting proper teaming agreements is obviously a critical question.
Things to Consider for Bid Protests: The first question when challenging an adverse decision in a bid protest is whether the solicitation had specific teaming agreement requirements.
Second, you must ask whether the solicitation further stated that the contractor teaming agreement was required as proof of a commitment from the teaming partner.
If the answer to both of those questions is yes, then there are some uphill battles for you to fight.
Submitting Properly Executed Federal Teaming Agreements
If you are partnered with other companies, you must submit signed teaming agreements at the time final proposals are submitted. Under these circumstances, you cannot submit teaming agreements that any court can construe as a preliminary agreement. It may not be deemed enforceable.
- Many government contractors submit their own version of a teaming agreement, only to find out later that the SSA does not recognize it as meeting the solicitation requirements or SBA regulations.
Therefore, filing a bid protest challenging the acceptability of your ‘teaming agreements’ may not help you. If your teaming agreement is not signed, or if there is language of potential relationship, you may be in trouble. The Federal Circuit Court has made this clear in its ruling of LaSalle Partners v. United States, 48 Fed. Cl. 797, 804-05 (2001).
Contractor Teaming Agreement Requirements – Wording is Critical
As a government contractor, drafting contractort teaming agreements using the words “good faith to enter into the contract if awarded” will be looked at as non-binding.
The legal question is whether a signed teaming agreement constitutes an enforceable contract. The following two cases confuse matters even worse when challenging the question in a bid protest.
In Cyberlock Consulting, Inc. v. Info. Experts, Inc., the U.S. District Court for the Eastern District of Virginia found a teaming agreement between two contractors unenforceable under Virginia law given the wording; the agreement included future transactions which the court found to be an agreement to agree, rather than a binding contract. The court confirmed what other state and Federal courts have decided about a teaming agreement.
In 2013, the Fifth Circuit in X Technologies, Inc. v. Marvin Test Sys., Inc., confirmed that exclusivity in a teaming agreement is enforceable to recover damages.
What are Your Chances of Winning in a Bid Protest?
When your teaming agreement is challenged in a bid protest, the agency’s decision about language containing “good faith efforts to contract” can cause two problems.
First, will a court disturb the agency’s solicitation requirement of a signed teaming agreement as proof of a binding relationship? Even if the answer is yes, then the second question becomes when did you file the protest? Arguably, you should have filed the protest before bid closing.
By arguing the Cyberlock Consulting case above, you may still not prevail on a pre-award protest because the result is that signed teaming agreements have no impact on the agency’s ability to evaluate because there is no binding relationship.
Although the agency has a right to want to see a teaming agreement, your only hope is to discuss the issue “of proof of a binding relationship” for Cyberlock to help you.
The logical approach using the X Technologies, Inc. v. Marvin Test Sys., Inc. is to use exclusivity language in your teaming agreement.
What makes up acceptable teaming agreements depends on the solicitation’s stated requirements. It is your responsibility to show that your proposal writing efforts meet the agency’s solicitation’s mandatory teaming agreement requirements to be technically acceptable.
For more help with submitting contractor teaming agreements for federal proposals, call our government contracts attorneys at 1-866-601-5518 for a free initial consultation.