Avoiding the Legal Pitfalls in the Lucrative World of Government Contracts and Procurements

In 2018, the United States federal government awarded private industry with nearly $550 billion in government contracts (an increase of more than $100 billion since 2015).  This elevated figure does not include the billions of dollars also awarded to private industry by state and local governments throughout the United States.  If you are a business owner, regardless of your industry or your appetite for government work, the procurement of government contracts presents a big business opportunity for your bottom line.

However, despite the obvious fiscal benefits of winning lucrative government contracts, the process for applying and obtaining a government contract can be challenging.  Government procurement practices are heavily regulated by government rules, laws, and administrative guidelines.  In some instances, a government project will draw funding from multiple levels of different governments and will, in return, subject the contract application process to multiple sets of competing rules, regulations, and administrative guidelines.

In addition, missteps by applicants in the procurement process can spell disaster if the government agency subsequently learns of a material error or omission by the applicant or if a losing applicant protests the award of the contract to the applicant.  Under certain circumstances, government agencies may even seek a suspension of debarment against a private contractor—which would preclude the private contractor from winning any government contracts for a set period of time.  This action by the government would not only banish a private contractor from the lucrative world of government contracts, it would also complicate the private contractor’s ability to seek private contracts, insurance, or bank loans, as well as cause public embarrassment to the private contractor in this increasingly communicative world.

For these reasons, applicants for government contracts should consider consulting an attorney to participate and monitor the private contractor’s application, negotiation, contracting, and performance of all government projects.  Early and ongoing consultation with an attorney can help a private contractor avoid the costly expense of defending a bid protest or an action for suspension/debarment.  Furthermore, if a private contractor finds itself on the wrong side of a bid protest or an action for suspension/debarment, that private contractor should immediately contact an attorney to discuss which steps can be taken to protect the contract in the short term and its business reputation in the long run.

By Jeff Donoho, Kennyhertz Perry, LLC

Jeff Donoho is an attorney at Kennyhertz Perry. He began his legal career as a judicial law clerk for two different trial judges in Jackson County, Missouri, which exposed him to a broad assortment of legal disputes and issues, ranging from minor property line disputes to multi-million dollar commercial and class action lawsuits. At Kennyhertz Perry, Jeff works with businesses of all sizes and businesspeople from all walks of life in addressing their complex commercial legal issues. Jeff has litigation, transactional, administrative, and appellate experience handling complex commercial matters. 

To learn more about Kennyhertz Perry, LLC, please visit kennyhertzperry.com.

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