Government Contracting Database

Defacto debarment occurs when an agency bars a contractor from competing for government contracts for a certain period of time without following the applicable debarment procedures found in the Federal Acquisition Regulations. See FAR § 9.406-3. In brief, the regulations require that an agency provide the contractor with a notice and opportunity to be heard prior to debarment. 

Previous courts considering this matter have established a high standard for plaintiffs to meet when trying to establish a defacto debarment claim. To succeed, a contractor must demonstrate a “systematic effort by the procuring agency to reject all of the bidder’s contract bids.” CRCMarineServ., Inc. v United States, 41 Fed. CL 66, 84 (1998) (citing Stapp Towing, Inc. v United States, 34 Fed. CL 300, 312 (1995)). Two options exist to establish a defacto debarment claim: 1) by an agency’s statement that it will not award the contractor future contracts; or 2) by an agency’s conduct demonstrating that it will not award the contractor future contracts. Id.; TLT Const. Corp. v. United States, 50 Fed.Cl. 212, 215–16 (2001); and Avkare, Inc. v. United States, 125 Fed. Cl. 11, 29 (2016), aff’d, 673 F. App’x 1011 (Fed. Cir. 2017). 

Updated: June 15, 2018