The June 26, 2012 decision in Agility Defense & Government Services, Inc. v. United States Department of Defense, No. 11-4111 (N.D. Ala. June 26, 2012) [pdf] reflects an important limitation on the government’s authority to suspend contractors simply because they are affiliated with companies accused of wrongdoing.
Agility Defense and Government Services, Inc. and Agility International, Inc. filed suit seeking to undo their suspensions after spending 31 months on the Excluded Parties List and being unable to convince the Defense Logistics Agency to lift the suspensions. DLA suspended the two companies not because they had engaged in wrongdoing, but because they were indirect affiliates of their ultimate parent company, Public Warehousing Company, K.S.C. The parent company was under indictment for defrauding the government of over $6 billion on food supply contracts in the Middle East. ADGSI and Agility had proposed a management buyout and other measures designed to remove PWC’s ability to control them and to assure their compliance with federal procurement laws. DLA nevertheless refused to lift the suspension.Continue Reading Limits on the government’s long-term suspension of affiliates