Lost protest leads to layoffs at NetCentrics
By
Nick Wakeman
NetCentrics will lay off nearly 100 people after it lost a protest to hang onto a large incumbent contract with the Defense Department.
Bid protests are deadly serious business: just ask the folks at NetCentrics.
Last week, NetCentrics filed a notice with the state of Virginia that it is planning to lay off 95 employees in its Arlington and Alexandria, Virginia, locations.
The notice was filed Oct. 3 and the layoffs take effect on Nov. 30. The notice on the Virginia Employment Commission website offers few other details. The Washington Business Journal first reported that NetCentrics had made the filing.
That comes in the wake of a lost court battle that NetCentrics fought to keep a $268.5 million incumbent contract to support the Defense Department’s Joint Service Provider organization.
NetCentrics won the recompete for IT support services, competitor NCI Information Systems filed a protest saying that NetCentrics’ bid included a person who no longer worked for the company.
DOD looked into the matter and agreed. They ruled that this was a “material misrepresentation” and rescinded the award. NetCentrics argued that while the person no longer worked for the company the intention was to bring the person back once an award was made. The person knew this as well and knew he was part of NetCentrics’ proposal, according to the company’s filings.
NetCentrics also requested that the court delay implementation of its decision because the company is appealing to the Court of Appeals for the Federal Circuit. In that request, NetCentrics says both the government and the court have erred. “The agency’s quibbles are irrelevant,” the company wrote. In the next sentence, NetCentrics says that the government is being “irrational.”
The company asked for a stay of the Court of Federal Claims decision so the Joint Service Provider would not transition work away from NetCentrics, pending its appeal. But the court denied the request for a stay.
That means the Defense Department can start to transition the work from NetCentrics. NCI was named the winner of the contract on Sept. 16.
With those decisions, it seems NetCentrics was left with little choice but to announce the layoffs, given the size of the contract and that the company is the incumbent.
The company has filed a notice of appeal with the Court of Appeals for the Federal Circuit, so while the layoffs are coming NetCentrics isn’t giving up the fight. No hearings are set yet.
NetCentrics officials did not return request for comment nor did their attorney.
The battle is unfortunate for NetCentrics because is a former small business that for the last two years or so has been competing with some success in the full-and-open environment.