The protester challenged the status of an SDVOSB joint venture. The joint venture agreement required the partners to collaborate on certain management decisions. The protester claimed this collaboration allowed the larger partner to control the SDVOSB partner. OHA, however, didn’t see how a collaboration requirement gave one partner power over the other.
VSBC Protest of Systematic Innovations, Re: DigiPathy LLC, SBA No. VSBC-339-P
- Protest – The VA awarded 30 contracts under the T4NG32 solicitation. Fifteen of those awards were set aside for SDVOSBs. One of those awardees, DigiPathy, was an SDVOSB joint venture. The protester filed a status protest alleging DigiPathy did not qualify as an SDVOSB.
- Joint Venture Agreement – SBA regulations specify several requirements for an SDVOSB joint venture agreement. Some of those requirements are contract specific. The protester noted the Digipathy joint venture had been formed before the solicitation. Thus, the protester argued, DigiPathy could not possibly comply with the SBA’s contract-specific JV requirements. But OHA didn’t see a problem. DigiPathy had amended its JV agreement to address the contract-specific requirements. Moreover, the solicitation called for the award of indefinite contracts for services. When a solicitation seeks indefinite services, OHA has found the joint venture requirements are not as stringent
- Collaboration – The joint venture agreement required collaboration between the venturers on some matters. The protester argued this collaboration requirement gave DigiPathy’s larger venturer negative control over the smaller partner. OHA didn’t see it. Rather, OHA read the collaboration requirement as merely requiring the partners to consult on some issues. It gave the lager partner a chance to voice its opinion on management questions but no ability to control the joint venture.
The protester is represented by Jonathan T. Williams, Meghan F. Leemon, Joseph P. Loman, and Annie B. Hudgins of PilieroMazza PLLC. The awardee is represented by Adam K. Lasky and Erica L. Bakies of Seyfarth Shaw LLP.
–Case summary by Craig LaChance, Senior Editor
