The appellant challenged the Area Office’s determination that it was not a small business. It claimed the 500-employee cap was superseded by 15 U.S.C. § 637(a)(17), which includes a broader eligibility framework for nonmanufacturers. OHA disagreed. The appellant failed to meet all the elements for the 15 U.S.C. § 637(a)(17) safe harbor provision. The Area Office correctly determined that the appellant exceeded the 500-employee cap.
Size Appeal of Osang, LLC, SBA No. SIZ-6358 (2025)
- Appeal – SBA issued a size determination, finding the appellant was not a small business for the subject procurement. The appellant argued the determination was clearly erroneous because the Area Office improperly enforced the 500-employee cap for the nonmanufacturer rule outlined in SBA regulation and the FAR, rather than applying the broader eligibility framework established by 15 U.S.C. § 637(a)(17). This broader framework provides an overriding statutory safe harbor that supersedes the regulatory cap of 500 employees for non-manufacturers.
- Decision – OHA found the appellant did not meet all the elements of the 15 U.S.C. § 637(a)(17) test. Specifically, the appellant did not meet the second element, which requires that the prime contractor “be a small business concern under the numerical size standard for the Standard Industrial Classification Code assigned to the contract solicitation on which the offer is being made. The RFP set forth an alternative size standard of 500 employees for non-manufacturers, which is also required by 13 C.F.R. § 121.402(b)(2). The appellant did not dispute that it was a nonmanufacturer. Thus, OHA denied the protest.
Daniel H. Ramish and Jonathan D. Shaffer of Haynes and Boone, LLP appeared for the appellant. Shane J. McCall, Nicole D. Pottroff, John L. Holtz, Gregory P. Weber, Stephanie L. Ellis, and Annie E. Birney of Koprince McCall Pottroff, LLC appeared for Branch Medical LLC.
— Case summary by Joshua Lim, Assistant Editor.
