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In June 2016, AmSurg Corp. and Envision Healthcare Holdings, Inc. (Envision) announced they have signed a definitive merger agreement pursuant to which the companies will combine in an all-stock transaction. Upon completion of the merger, which is expected to be tax-free to the shareholders of both organizations, the combined company will be named Envision Healthcare Corporation and co-headquartered in Nashville, Tennessee and Greenwood Village, Colorado. The company's common stock is expected to trade on the New York Stock Exchange under the ticker symbol: EVHC. Bass, Berry & Sims served as lead counsel on the transaction, led by Jim Jenkins. Read more.

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Inside the FCA blogInside the FCA blog features ongoing updates related to the False Claims Act (FCA), including insight on the latest legal decisions, regulatory developments and FCA settlements. The blog provides timely updates for corporate boards, directors, compliance managers, general counsel and other parties interested in the organizational impact and legal developments stemming from issues potentially giving rise to FCA liability.

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GovCon Blog: Learning from Bid Protests: Responsibility vs. Acceptability


November 5, 2014

In government contracting, offerors are regularly evaluated in their proposed approaches to meet solicitation requirements. Occasionally, an offeror's proposed solution is immaterial, as the offeror's overall ability to perform the work required by a solicitation is called into question.

Whether it is inadequate financial resources, an inability to meet delivery schedules or an inability to obtain a security clearance, some offerors fail to meet general criteria of responsibility required to perform. Generally, the procuring agency can eliminate an offeror based on a determination of nonresponsibility. However, small businesses are provided a little cover.

Before a federal procuring agency can eliminate a small business offeror based on general criteria of responsibility, the agency is required to first refer the matter to the SBA. The SBA has the sole authority to measure a small business' ability to perform a contract. In such cases where a small business' ability to perform is at issue, the SBA can issue a Certificate of Competency, which effectively serves as an SBA seal of approval for the contractor on that specific contract.

However, there is a difference between responsibility and acceptability—whether a contractor is able to perform the work vs. whether the contractor actually proposed to perform the work sought by the agency. There is no requirement for procuring agencies to refer matters to the SBA when a contractor submits an unacceptable proposal, i.e., where it did not propose to actually meet the solicitation requirements.

This difference in responsibility and acceptability was demonstrated in a recent GAO decision, MT & Associates, LLC. This protest involved the award of a small business set-aside contract for sign language interpreting services. The solicitation required offerors to propose interpreters with Top Secret/Sensitive Compartmented Information (TS/SCI) security clearances. The protester, MT & Associates, failed to include information regarding the security clearances of its proposed interpreters. As a result, the agency determined MT & Associates to be ineligible for award and eliminated it from the competition.

MT & Associates argued that the ability to obtain a security clearance is a matter of responsibility, and thus the agency was required to refer the matter to the SBA under the Certificate of Competency procedures prior to eliminating its proposal. The agency countered by arguing that this was not an issue of responsibility, but rather the acceptability of MT & Associates' proposal. GAO agreed with the agency and denied the protest.

GAO found that proposing interpreters with the requisite security clearances was a material term in the solicitation. The issue wasn't whether MT & Associates could meet the requirement, but whether it proposed to meet the requirement. Because MT & Associates' proposal failed to propose interpreters with the TS/SCI security clearances, there was a legitimate question as to MT & Associates' commitment to complying with the requirement. Thus, GAO determined that the agency properly determined MT & Associates' proposal to be unacceptable.

This decision provides a couple of takeaways, one on acceptability and another on responsibility. First, offerors (of all sizes) should carefully review the terms of a solicitation and ensure that proposals adequately respond to each material term and condition. As in MT & Associates, failure to do so can result in rejection of a proposal for being unacceptable.

Finally, if an agency eliminates a small business offeror from consideration for award on the basis of a nonresponsibility determination, the small business should ensure that the issue is properly referred to the SBA. The Certificate of Competency program is but one of the various programs available to assist small businesses in the federal procurement marketplace, and "responsible" contractors would be wise to take advantage.

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