Court Cuts Off Last Avenue for Prototype Deal Protests

An Arizona federal court dismissed MD Helicopters Inc.'s protest of its exclusion from a U.S. Army Other Transaction Agreement (OTA) due to lack of jurisdiction to hear bid protests under the 1996 Administrative Dispute Resolution Act. This decision took away the last avenue bidders had to dispute OTAs, which may require an appeals court or Congress to clarify as the number of OTAs awarded continues to grow.

"Other contracting agencies don't yet seem to fully understand OTAs, and once they do, that could lead to widespread growth for the agreements," said Partner Eric Crusius. "Agencies' priority is to get the product or the service they need, and to get it as quickly as possible, and they view protests as an impediment to that. So if they can find a way to avoid protests using OTA, if it's appropriate, they'll certainly do that."

Mr. Crusius also speculated that "with more of these cases coming out, at least in this line of cases denying jurisdiction on these particular facts ... you might see some future legislation granting more avenues for a disappointed bidder in an OTA to find relief."

READ: Court Cuts Off Last Avenue for Prototype Deal Protests