Supreme Court Ruling

Kingdomware Technologies, Inc., v. United States, No. 14-916 (2016)

Supreme Court Ruling Mandates How the VA Sources Products

The U.S. Supreme Court’s (SCOTUS) unanimous decision in Kingdomware Technologies, Inc. vs. United States is a huge win for Service Disabled Veteran Owned Small Businesses (SDVOSB). As a result of this ruling, Red One gained priority access to VA contracting opportunities through our SDVOSB status.

A Closer Look at the Supreme Court Ruling

  • The ruling makes SDVOSB as the highest priority VA set aside status, followed by VOSB (Red One Medical is both an SDVOSB and VOSB)
  • The Supreme Court ruling utilizes commanding and clear language leaving no room for optional compliance.
  • The ruling supersedes any priority requirements of VAAR 808.002(a).
  • The ruling decided that “Orders” are still considered “Contracts” and are not exempt from the ruling.
  • The VA must first perform a Rule of Two analysis and may only buy from a non-veteran source when the conditions of the Rule of Two are not satisfied.
  • Contracting officers must prioritize SDVOSBs by applying the Rule of Two under 38 U.S.C. § 8127(d).
  • Contracting officers must perform documented market research in an attempt to allow SDVOSBs and VOSBs a fair chance to compete for an opportunity.
  • To determine whether the Rule of Two was appropriately applied a review of original market research and VA Form 2268 will be conducted. If the Rule of Two was not appropriately considered and offers were not received from two or more qualified, capable and verified SDVOSBs or VOSBs at a fair and reasonable price, then an amendment is issued that cancels the solicitation.

The Rule of Two

  1. If the contract is between $3,000 and $150,000, it’s automatically reserved for small businesses according to their priority status. (SDVOSB is the highest set-aside priority for the VA and other agencies, and the SCOTUS ruling also applies to contracts greater than $150,000).
  2. If the contracting officer does not have access to at least two responsive, responsible small businesses, he/she is allowed to award to any qualified contractor through full and open competition.
  3. If the opportunity goes to full and open competition, the contracting officer must justify their decision. That justification is reviewed and accepted or rejected by other members of the acquisition team – including the small business advocate, who will not sign off on the contract unless market research has been conducted to determine if there are any qualifying small businesses. (With the VA, these are first and foremost SDVOSBs like Red One Medical and next in line VOSBs.)

Work with Red One and Our Priority SDVOSB Status