GSA’s has a case now before a D.C. District Court judge that could have a significant impact on the future of defense contracting not only in the transportation sector but across all defense department contracts. It is generally recognized that doing business with the Pentagon is challenging at the best of times, involving unique regulations and accounting practices. Moreover, contracts can be cancelled at the convenience of the government. GSA’s behavior with respect to one contract could add an additional complicating factor into a private firm’s decision on both how to respond to a contracting officer’s requests or even whether to pursue a government contract in the first place.
If GSA wins its case, companies in the defense space will have to worry not only about meeting the needs of the contracting officer, but also about being second-guessed by GSA or penalized for responding to the contracting officer’s legitimate requests. This could lead to a flurry of court cases in the best of circumstances. At worst, it could compromise national security, should companies take a more self-protective stance and adhere strictly to the letter of a contract as interpreted by GSA.