DynCorp Issues Redacted Complaint In $10B Contract Fight

DynCorp Issues Redacted Complaint In $10B Contract Fight

Law360, New York (January 23, 2017, 7:43 PM EST) — U.S. defense contractor DynCorp has filed a redacted version of a previously sealed complaint in its bid dispute over a $10 billion State Department counter-narcotics contract awarded to a competitor it claims stole its trade secrets to improve its bid.
DynCorp has asked the State Department to reverse its award of a $10 billion contract DynCorp long held for air support for counter-narcotics operations on multiple continents to rival company AAR Airlift Group, Inc., claiming the department violated its obligation to take into account AAR Airlift’s record on business ethics and integrity by ignoring the company’s alleged efforts to steal DynCorp trade secrets and past safety problems.

“State’s award decision to AAR was fundamentally flawed, irrational, and contrary to the solicitation’s requirements, and but for these errors, [DynCorp] would have been awarded the contract,” the complaint states.

DynCorp is currently embroiled in a separate suit with AAR Corp. in Florida federal court over its allegations that AAR stole a profit margin analysis containing confidential information on DynCorp’s management of the State Department’s counter-narcotics program and hired away DynCorp employees in an effort to learn trade secrets related to the program.

State, the defense contractor claims, did not appropriately investigate DynCorp’s allegations in awarding the contract, which DynCorp has executed for two decades, to AAR.

DynCorp further claims that the State Department improperly eliminated its proposal from competition for the contract and, following a 2015 Government Accountability Office protest, continued to overstate the contractor’s weaknesses, undermined its strengths and applied unstated evaluation criteria to its proposal, which it again rejected in September.

By contrast, the company claims, the State Department gave high marks to AAR for past performance, despite “a troubling pattern of safety problems,” including two fatal crashes in 2009, another in 2012 and another in 2016, after the contract was awarded.

“State engaged in a pervasive pattern of disparate treatment of DI’s and AAR’s highly comparable solutions across all of the solicitation’s technical factors and sub-factors, as well as with regard to the past performance factor,” the complaint states.

DynCorp is seeking an order overturning the award of the contract to AAR and directing the State Department to award the contract to DynCorp, or failing that, directing the agency to request “best and final” offers from DynCorp and AAR and award the contract to the best value offer.

DynCorp’s suit against AAR gained new life in November when the Eleventh Circuit overturned a Florida district court’s 2016 ruling that its allegations AAR misused insider information were not adequately specific.

DynCorp is represented by David M. Nadler, Adam Proujansky, David Y. Yang, Stephanie M. Zechmann and Philip E. Beshara of Blank Rome LLP.

The United States is represented by Douglas V. Edelschick of the U.S. Department of Justice, Civil Division.

The case is DynCorp International LLC v. The United States, case number 1:16-cv-01704-LJB, in the U.S. Court of Federal Claims.

–Editing by Jack Karp.

Updated to reflect the district court’s overturned ruling against DynCorp in its suit against AAR was made in 2016, not 2017. The case is currently proceeding.

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