On September 24, the Government Accountability Office (GAO) denied DynCorp International, LLC's (DynCorp) protest of the Department of the Army's award of a global intelligence logistics support task order to CACI Technologies, Inc. (CACI, Inc.). DynCorp alleged that the award was improper, citing the fact that CACI, Inc. no longer existed as a corporate entity. Additionally, DynCorp challenged the Department of the Army's evaluation of the proposals submitted. The GAO rejected both of DynCorp's arguments and found the task order's award to CACI, Inc. proper.
Conversion to Limited Liability Company Affects Bid
While the GAO's decision has the familiar discussion regarding the weight and comparison of proposal elements, its examination of CACI, Inc.'s corporate entity change and how that affects the bid process is particularly noteworthy as the Federal Acquisition Regulation (FAR) is silent on this issue. In this case, CACI Technologies, Inc. was awarded a GISS IDIQ contract in September 2014 under the CAGE code 8D014. On December 31, 2017, CACI Technologies, Inc. converted to CACI Technologies, LLC (CACI, LLC) while retaining the same CAGE code as the former entity.
After the conversion to a limited liability company, CACI, LLC worked with the Defense Contract Management Agency (DCMA) to effect a name change, per FAR 42.1205. CACI, LLC reached an agreement with DCMA on the terms of a conversion and name change by March 2018, but the agreement was not approved and finalized by DCMA until April 2020. In the interim between CACI, LLC's conversion and when DCMA approved the name change and conversion, CACI, LLC bid on the Department of the Army contract at issue.
Because DCMA had not yet officially recognized CACI, LLC as the successor to CACI, Inc. when proposals were submitted, the company used CACI, Inc. as the entity name when submitting its proposal, along with the unchanged CAGE code.
CAGE Code Was Critical
DynCorp alleged that CACI, Inc. was not the offering entity and that no entity by that name existed at time of bid or task order award, and therefore the awardee failed to comply with the requirement to maintain an accurate registration in the System for Award Management (SAM) at the time of proposal submission. GAO disagreed and held that CACI, LLC's actions in the situation were appropriate.
As the DCMA had not yet recognized the existence of CACI, LLC, it was appropriate for the company to use the entity name that matched its CAGE code (CACI, Inc.). The use of this CAGE code made it clear to the Department of the Army which corporate entity it was interacting with, even though that corporate entity no longer existed. The GAO stated that:
"when CACI submitted its proposal in January 2020, the government had not yet finalized the conversion and name change agreement. Accordingly, the federal government still considered the GISS IDIQ contract to be held by CACI Technologies, Inc., which is the same name CACI used on its FPR for this procurement. CACI did not update its SAM registration to show that it had converted into a limited liability company until June 2020, after the government finalized the conversion and name change agreement. Thus, given that the conversion and name change agreement was still pending when CACI submitted its proposal in January 2020, we find that the SAM registration accurately listed the entity as CACI Technologies, Inc."
Key Takeaways for Government Contractors
One key takeaway from this decision is that contractors that have recently undergone a corporate entity change can continue to submit proposals for contracts, even if DCMA has not yet approved the entity change. Contractors in this situation should continue to use their former entity name and CAGE code when submitting proposals until DCMA has recognized the new entity name. GAO's decision provides some clarity around an issue that is simply not addressed by the FAR.
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