Background - Practices (Details)

Defective Pricing


Our practice covers the full range of defective pricing issues and related disputes. We field questions on cost or pricing data issues in real time, such as the following:

  • What is effective disclosure?
  • How do you deal with subcontractor data?
  • What about commercial items and interdivisional work orders?
We provide comprehensive advice to clients — civilian and military, GSA supply schedule and FMS, prime and subcontractors — in grappling with disclosures, audits, and fraud risks. We respond to defective pricing audit reports, develop compliance strategies, and handle defective pricing/fraud investigations. We also have performed dozens of compliance reviews of contractors' policies, procedures, and practices to ensure TINA compliance. In addition, we have won the two largest cases in the history of the Truth in Negotiations Act (TINA).

Representative Engagements

  • Defeated $299 million defective pricing claim after a 33-day trial and Federal Circuit appeal, covering nearly every facet of TINA, from disclosure and judgments to offsets, reliance, and causation. 
  • Sustained a contractor's appeal of a final decision that it had defectively priced a multiple-award-schedule contract for systems furniture. In this 55-page decision, the GSBCA concluded, inter alia, that GSA had failed to establish defective pricing because the undisclosed commercial discounts upon which it based its case were not for relevant products and that, even if GSA had demonstrated defective pricing, its method of calculating damages was unreasonable. 
  • Defended a defective-pricing-based False Claims Act case (in federal district court, one of the few tried to conclusion) principally involving alleged nondisclosure of changes to a bill of materials. 
  • Prevailed on $90 million claim testing when a management decision having possible cost reduction impacts becomes cost or pricing data. Lockheed Corp., ASBCA Nos. 36420, 37495, and 39195, 95-2 BCA ¶ 27,722.