SBA Size Protest Law
Size Protests, Size Determinations, and SBA Appeals Lawyers
Aggressively Protecting or Defending Small Businesses’ Rights in Affiliation Protests.
Size Standard Appeal Representation: Watson & Associates, LLC represents small businesses in a wide range of high-stakes size protest litigation nationwide, particularly matters that raise issues at about 
affiliation (Ostensible Subcontractor Rule), affiliation through ownership, identity of interests and other allegations of violating Size Standards. Small businesses get the benefit of obtaining cost-effective resolutions from attorneys that have been on the other side. Clients can feel comfortable with our skill when attacking mistakes made by government officials. Our government contracts law firm has extensive experience handling size protests before the Small Business Administration (SBA) or size protest appeals before SBAOHA.
Our clients include SBA 8a companies, service disabled veteran owned businesses and other socio-economic categories. Clients originate from various industry groups including information technology (IT), construction companies engaged in teaming agreements, aerospace, medical and more. Small businesses clients hire us to litigate and defend them in size protest and appealing adverse rulings from the SBA to Office of Hearing and Appeals. The firm can help you with size protest decisions that stem from varying perspectives to include:
- Affiliation through ownership
- Negative control
- Indirect ownership through third parties
- The present effect rule
- Common management
- Identity of interest (family members etc.)
- Common investments
- Ostensible Subcontractor Rule…and more
Zealous Advocacy and Litigation: When litigating or defending size protests, your rights are protected through creative legal and factual analysis and strategy coupled with zealous advocacy. Sometimes that means wining at the initial stages of the bid protest. Sometimes it means winning through motion practice. Sometimes it means litigating issues on appeal or negotiating a favorable settlement that avoids litigation risk and expense. Sometimes it means counseling on issues so that the client can avoid size protest litigation altogether. You can also benefit from the firm’s strong small business regulatory and public policy practices. Our multidisciplinary approach to government contracting enables us to draw on the technical experience of our size protest lawyers to develop creative defenses and pursue every avenue to resolve your’ problems. See recent case where Watson & Associates overturn SBA affiliation decision.
Survive SBA Size Protest Investigations: If your company recently lost competition for a federal small business set-aside contract, Theodore Watson & Associates’ government contract attorneys can help to file or defend a size protest on your behalf. The U.S. Small Business Administration (SBA) will investigate your company’s small business size status. Therefore, you want to avoid the deadly land mines that may weaken your case. Our law firm has successfully helped contractors to challenge or defend allegations of violating the Ostensible Subcontractor Rule. Therefore, we have the necessary experience and skill to help you. Our protest attorney will help you to:
- Properly respond to or file your size protest
- Aggressively fight for your rights
- Assess the reason for the size protest
- Ensure you have standing
- Draft and file the appropriate pleadings
- Support your position with case law
- Address common ownership challenges
- Prepare necessary exhibits
- Address the Ostensible Subcontractor Rule challenges
Violating the NAICs Size Standards Can be Devastating
Government contractors often join forces to compete for government contracts. This is often accomplished by using teaming agreements under FAR 9.6. Having a properly drafted teaming agreement by a federal procurement lawyer can minimize the risk a bid protest due to violating the NAICs size standards. Our law firm will review your documents for adequacy and legal sufficiency.
The result of an improperly-drafted teaming agreement could be that the SBA deems you “affiliated” with the other company under the Ostensible Subcontractor Rule. This is grounds for overturning the award.
As a small business, you must be aware of the Small Business Size Regulation and Methodology and Use of Size Standards for Government Procurement. In government contracting, a contracting officer analyzes a small business’ size by referring to 13 C.F.R. 121. However, you can be caught in a situation where you are teaming with another business (usually a large business) where instances of affiliation may be present. This is where a government contracts attorney that understands the NAICS size standard rules can help you.
Size Protests in General
Understanding the process is critical: When you bid on a government contract, the agency will generally accept the small business’ certification as being small. However, your size determination can be challenged in a bid protest to the contracting officer or to the SBA. When the SBA investigates your small business size, the contracting officer must accept the SBA determination as final. Protecting your rights is critical because you can end up waiving them on appeal. Having a size protest attorney may then allow you to appeal to the SBA Office of Hearing and Appeals (SBAOHA).
Size protest defense can become problematic when you wait until the appeal stage to hire an attorney. This is true simply because your initial response to the SBA can be already damaged. Always consider retaining a size protest attorney that is familiar with SBA NAICs Standards and the Ostensible Subcontractor Rule.
Who can File a Size Protest?
Not just anyone can file a bid protest. Having standing to file a Size bid protest is critical at the beginning stage. In order for you to file a small business size protest, you must show that you have standing. As a small business you should have submitted a proposal as a prime contractor and must not have been eliminated from the competition. In addition, government contractors should have some reasonable grounds to challenge the size standard. The bid protest lawyers at Theodore Watson & Associates can help you with this analysis.
The following parties can file an SBA size protest.
- Unsuccessful Offeror
- Contracting Officer
- SBA Government Contracting Area Office
- Other Interested Parties
- Other Government Officials
Size Appeals
You are facing short protest and appeal deadlines: The SBA area office makes initial size determinations within very tight time constraints (usually within 10 days of receiving a protest). Area office determinations may be appealed to the SBA Office of Hearing and Appeals at SBA headquarters in Washington, D.C. by any of the interested parties (there is no legal right to an appeal.)
An appeal for a size determination must begin by serving and filing an appeal petition in writing. The following lists the basic rules for appeals:
- If the appeal is for a size determination in procurement or pending government property sale, then the appeal petition must be served and filed within 15 calendar days after the size determination was made.
- If the appeal is for a size determination other than one in a pending procurement or pending government property sale, then the appeal petition must be served and filed within 30 calendar days after the size determination was made.
- An untimely appeal will be dismissed.
The SBA Office of Hearing and Appeals will do a standard review of the appeal, issue a decision containing the facts and the conclusion that was made based on the appeal, and notify in writing all parties involved. This is the final decision of the SBA. To understand your appeal rights, call our government contract attorneys for immediate help at 1-866-601-5518.
The Ostensible Subcontractor Rule
The silent weapon – be aware of the Ostensible Subcontractor Rule: Under 13 C.F.R. 121.103, a contractor and its ostensible subcontractor are treated as joint venturers, and therefore affiliates, for size determination purposes. An ostensible subcontractor is a subcontractor that performs primary and vital requirements of a contract, or of an order under a multiple award schedule contract, or a subcontractor upon which the prime contractor is unusually reliant.
All aspects of the relationship between the prime and subcontractor are considered, including, but not limited to, the terms of the proposal (such as contract management, technical responsibilities, and the percentage of subcontracted work), agreements between the prime and subcontractor (such as bonding assistance or the teaming agreement), and whether the subcontractor is the incumbent contractor and is ineligible to submit a proposal because it exceeds the applicable size standard for that solicitation. Given the fact that a lucrative contract is at stake, you should seriously consider retaining a government contract law firm that understands the law. Call Watson & Associates for immediate help at 1-866-601-5518.
Learn How to Avoid Costly Size Bid Protest Mistakes
As government contract bid protest lawyers, we often find that protestors sometimes make costly mistakes when filing a SBA size determination protest. The following are some key practices to avoid.
- Never file a size standard protest to GAO
- Never file a protest after 5 days of being aware of the size deficiency
- Never make general allegations without support
- Never file based upon “information and belief.” You should provide specific facts about the business in question
In determining the business’ size, the SBA counts the receipts, employees, or other measure of size of the concern whose size is at issue and all of its domestic and foreign affiliates, regardless of whether the affiliates are organized for profit. Ensure that you provide adequate responses and documents in the initial SBA investigation.
Exceptions to Affiliation
When filing a request for size determination, you or your bid protest lawyer should be aware that certain business concerns are exempt from affiliation rules. This includes:
- Business concerns owned in whole or substantial part by investment companies licensed, or development companies qualifying, under the Small Business Investment Act of 1958, as amended, are not considered affiliates of such investment companies or development companies.
- Business concerns owned and controlled by Indian Tribes, Alaska Native Corporations (ANCs) organized pursuant to the Alaska Native Claims Settlement Act, Native Hawaiian Organizations (NHOs), Community Development Corporations (CDCs), or wholly-owned entities of Indian Tribes, ANCs, NHOs, or CDCs are not considered affiliates of such entities.
NAICS Size Standard – Control & Affiliation
Control is the underlying target in this type of bid protest: Businesses and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists. The Small Business Administration (SBA) considers factors such as ownership, management, previous relationships with or ties to another business, and contractual relationships, in determining whether affiliation exists.
Control may be affirmative or negative: Negative control includes, but is not limited to, instances where a minority shareholder has the ability, under the business’ charter, by-laws, or shareholder’s agreement, to prevent a quorum or otherwise block action by the board of directors or shareholders.
NAICS Size Standard Affiliation may be found where an individual, concern, or entity exercises control indirectly through a third party.
In determining whether affiliation exists, the SBA will consider the totality of the circumstances, and may find affiliation even though no single factor is sufficient to constitute affiliation. At Watson & Associates LLC, our bid protest attorneys understand the slippery slope. Giving up a lucrative contract is usually devastating experience.
Nationwide Representation
Regardless of your state, our law firm can help. Our attorneys can represent you in a small business size protest in Denver, Washington D.C., Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, and Virgin Islands. Cities include: San Diego, Dallas, Miami, Atlanta, Anchorage, San Francisco, Denver, Colorado Springs, Indianapolis, Austin, San Antonio, Philadelphia, Santa Clara, San Jose and Chicago.
Contact us for Immediate Help
If you need help bringing or defending an SBA NAICS size standard protest, contact online or call the Theodore Watson & Associates’ law firm at 866-601-5518.
