B-160538, NOV. 15, 1967

B-160538: Nov 15, 1967

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BECAUSE IT DID NOT HAVE N.Y. STATE LICENSE WHEN IT CERTIFIED IT WAS NOT PINKERTON DETECTIVE AGENCY. WAS PARTIALLY BASED ON INACCURACIES IN ADMINISTRATIVE REPORT. ALTHOUGH BIDDER WAS NOT ELIGIBLE BIDDER UNDER INVITATION SINCE IT DID NOT HOLD LICENSE AT DATE OF AWARD. DEFICIENCY WAS CORRECTED AND CONTRACTOR IS NOT A PROHIBITED DETECTIVE AGENCY BUT IS LICENSED TO PROVIDE GUARD SERVICES. THEREFORE CONTRACT WAS AT THE MOST VOIDABLE AND IN VIEW OF PROCUREMENT AGENCY'S POSITION THAT IT WOULD NOT BE IN GOVT.'S INTEREST TO REGARD THE CONTRACT AS PROHIBITED BY ANTI-PINKERTON STATUTE. CANCELLATION IS NOT REQUIRED. INC.: FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF APRIL 14. THE BASIS OF YOUR PROTEST IS THAT THE CONTRACTOR EXECUTED FALSE STATEMENTS IN ITS BID WITH REGARD TO ITS ELIGIBILITY UNDER THE ACT OF MARCH 3.

B-160538, NOV. 15, 1967

BIDDERS - ANTI PINKERTON DETERMINATION DECISION TO METROPOLITAN SECURITY SERVICES, INC., DENYING PROTEST AGAINST AWARD BY GSA OF ARMED GUARD SERVICE CONTRACT TO INVESTIGATIVE BUREAU OF N.Y. INC. BECAUSE IT DID NOT HAVE N.Y. STATE LICENSE WHEN IT CERTIFIED IT WAS NOT PINKERTON DETECTIVE AGENCY. COMP. GEN. DECISION OF MARCH 24, 1967, WAS PARTIALLY BASED ON INACCURACIES IN ADMINISTRATIVE REPORT. ALTHOUGH BIDDER WAS NOT ELIGIBLE BIDDER UNDER INVITATION SINCE IT DID NOT HOLD LICENSE AT DATE OF AWARD, DEFICIENCY WAS CORRECTED AND CONTRACTOR IS NOT A PROHIBITED DETECTIVE AGENCY BUT IS LICENSED TO PROVIDE GUARD SERVICES. THEREFORE CONTRACT WAS AT THE MOST VOIDABLE AND IN VIEW OF PROCUREMENT AGENCY'S POSITION THAT IT WOULD NOT BE IN GOVT.'S INTEREST TO REGARD THE CONTRACT AS PROHIBITED BY ANTI-PINKERTON STATUTE, 5 U.S.C. 3108, CANCELLATION IS NOT REQUIRED.

TO METROPOLITAN SECURITY SERVICES, INC.:

FURTHER REFERENCE IS MADE TO YOUR TELEGRAM OF APRIL 14, 1967, PROTESTING AGAINST THE AWARD OF A CONTRACT TO INVESTIGATIVE BUREAU OF NEW YORK, INC., ON APRIL 5, 1967, UNDER INVITATION FOR BIDS NO. 2PBO RC-375. THE CONTRACT COVERS THE FURNISHING OF UNIFORMED UNARMED GUARD SERVICE AT THE FORDHAM ROAD PROJECT, FORDHAM ROAD AND THIRD AVENUE, BRONX, NEW YORK. THE BASIS OF YOUR PROTEST IS THAT THE CONTRACTOR EXECUTED FALSE STATEMENTS IN ITS BID WITH REGARD TO ITS ELIGIBILITY UNDER THE ACT OF MARCH 3, 1893, 5 U.S.C. 53 (NOW CODIFIED AS 5 U.S.C. 3108) BECAUSE IT DID NOT HAVE THE REQUIRED NEW YORK STATE LICENSE ON DECEMBER 6, 1966, WHEN IT CERTIFIED THAT IT WAS NOT A PINKERTON DETECTIVE AGENCY OR A SIMILAR AGENCY AS CONTEMPLATED BY THE CITED ACT.

YOUR PROTEST AGAINST CONSIDERATION OF THE BID OF INVESTIGATIVE BUREAU OF NEW YORK, INC., WAS THE SUBJECT OF OUR DECISION B-160538, B 160540, DATED MARCH 24, 1967, WHEREIN WE HELD THAT SINCE INVESTIGATIVE BUREAU WAS THE LOWEST ELIGIBLE BIDDER UNDER THE INVITATION, AWARD TO THAT BIDDER WOULD SEEM TO BE IN ORDER PROVIDED SUCH ACTION WAS PROPER IN OTHER RESPECTS. OUR DECISION WAS BASED ON THE FACTS THEN OF RECORD FURNISHED TO US BY THE GENERAL SERVICES ADMINISTRATION.

HOWEVER, ON THE BASIS OF FURTHER INVESTIGATION, THE GENERAL SERVICES ADMINISTRATION NOW ADVISES THAT THERE WERE CERTAIN INACCURACIES IN ITS REPORT UPON WHICH OUR DECISION OF MARCH 24, 1967, WAS PARTIALLY BASED. THESE INACCURACIES APPEAR TO HAVE RESULTED, IN PART AT LEAST, FROM THE GENERAL SERVICES ADMINISTRATION'S FAILURE TO HAVE MADE CLEAR TO THOSE FROM WHOM INFORMATION WAS REQUESTED THE SIGNIFICANCE OF THE DISTINCTION BETWEEN THE TWO TYPES OF LICENSES WHICH ARE ISSUED BY THE STATE OF NEW YORK, BOTH OF WHICH AUTHORIZE PERFORMANCE OF WATCH, GUARD OR PATROL AGENCY SERVICES. THE SUMMARY QUOTED BELOW REFLECTS THE ADDITIONAL INFORMATION OBTAINED BY THE GENERAL SERVICES ADMINISTRATION AND FURNISHED TO OUR OFFICE IN CONNECTION WITH YOUR CURRENT PROTEST: "NEW YORK LAW PROVIDES THAT NO PERSON OR COMPANY MAY ENGAGE IN THE BUSINESS OF WATCH, GUARD OR PATROL AGENCY WITHOUT HAVING FIRST OBTAINED FROM THE STATE A LICENSE TO DO SO. A PRIVATE INVESTIGATOR LICENSE PERMITS THE HOLDER TO PERFORM THE SERVICES OF A PRIVATE INVESTIGATOR AND OF A WATCH, GUARD AND PATROL AGENCY. A WATCH, GUARD OR PATROL AGENCY LICENSE LIMITS THE HOLDER TO THE PERFORMANCE OF SERVICES AS A WATCH, GUARD AND PATROL AGENCY, AND DOES NOT AUTHORIZE PRIVATE INVESTIGATOR SERVICE. "THE CERTIFICATE OF INCORPORATION OF INVESTIGATIVE BUREAU, FILED MAY 22, 1962, AUTHORIZED THE COMPANY TO ENGAGE IN PRIVATE DETECTIVE AND INVESTIGATIVE WORK. THE ELIGIBILITY OF THE COMPANY, HOWEVER, IS DETERMINED BY THE TYPE OF LICENSE WHICH IT HOLDS, AS INDICATED IN THE LAST PARAGRAPH OF YOUR DECISION OF MARCH 24, 1967. "AT THE TIME OF THE SUBMISSION OF ITS BID, INVESTIGATIVE BUREAU DID NOT HAVE EITHER TYPE OF LICENSE. ON DECEMBER 2, 1966, IT HAD APPLIED TO THE STATE OF NEW YORK FOR A WATCH, GUARD OR PATROL LICENSE (HEREINAFTER REFERRED TO AS A GUARD LICENSE). HOWEVER, UNKNOWN TO GSA, ON OR ABOUT JANUARY 10, 1967, INVESTIGATIVE BUREAU WITHDREW ITS APPLICATION FOR SUCH A LICENSE. "APPARENTLY THIS FOLLOWED ADVICE GIVEN TO INVESTIGATIVE BUREAU BY THE STATE DIVISION OF LICENSING AND SERVICES THAT A GUARD LICENSE WOULD NOT BE NECESSARY, SINCE PRIVATE INVESTIGATOR LICENSE NO. 10236, PREVIOUSLY ISSUED TO MR. EDWARD J. SHINNICK, VICE PRESIDENT AND SECRETARY OF THE COMPANY, COULD, UPON ENDORSEMENT TO INVESTIGATIVE BUREAU, AUTHORIZE THE PERFORMANCE OF GUARD SERVICES BY THE COMPANY. "SUBSEQUENTLY, MR. JACK RYBACK, JR., PRESIDENT OF INVESTIGATIVE BUREAU, ADVISED OUR REGIONAL OFFICE IN NEW YORK THAT THE COMPANY HAD OBTAINED A LICENSE. IT WAS INCORRECTLY ASSUMED THAT HE REFERRED TO A GUARD LICENSE, SINCE IT WAS KNOWN THAT THAT TYPE OF LICENSE HAD BEEN APPLIED FOR. "ON JANUARY 26, 1967, PRIVATE INVESTIGATOR LICENSE NO. 10236 WAS ENDORSED TO INVESTIGATIVE BUREAU. ACCORDINGLY, INVESTIGATIVE BUREAU BECAME AUTHORIZED TO PROVIDE GUARD SERVICES OF THE TYPE REQUIRED UNDER THE PROPOSED CONTRACT, BUT BY VIRTUE OF THE NATURE OF THE LICENSE BECAME AUTHORIZED ALSO TO ENGAGE IN INVESTIGATIVE WORK. "IN DISCUSSION OF THIS MATTER AFTER THE LATEST PROTEST, THE PRINCIPAL CLERK OF THE STATE DIVISION OF LICENSING SERVICES ADVISED ONE OF THE ATTORNEYS IN OUR REGIONAL COUNSEL'S OFFICE AT NEW YORK THAT, IN PROVIDING INFORMATION PRIOR TO THE AWARD OF THE CONTRACT, SHE WAS UNAWARE OF THE PROVISIONS OF THE ANTI-PINKERTON ACT AND THE EFFECT THAT THE TYPE OF LICENSE HELD WOULD HAVE UNDER THE PROVISIONS OF THAT ACT. FROM THE CORRESPONDENCE, IT APPEARS ALSO THAT INVESTIGATIVE BUREAU WAS UNDER THE MISUNDERSTANDING THAT THE TYPE OF LICENSE AUTHORIZING IT TO PERFORM GUARD SERVICES WAS NOT IMPORTANT AS LONG AS THE COMPANY DID NOT IN FACT PERFORM INVESTIGATIVE SERVICES. "ON MAY 18, 1967, AN APPLICATION FOR A GUARD LICENSE WAS RECEIVED BY THE STATE DIVISION OF LICENSING SERVICES FROM INVESTIGATIVE BUREAU. SUCH A LICENSE WAS ISSUED JUNE 8, 1967. "WE HAVE BEEN ADVISED BY TELEPHONE BY THE STATE DIVISION OF LICENSING SERVICES THAT PRIVATE INVESTIGATOR LICENSE NO. 10236 WAS ENDORSED BY INVESTIGATIVE BUREAU TO P. I. SYSTEMS, INC., ON SEPTEMBER 8, 1967. WE ARE INFORMED THAT P. I. SYSTEMS, INC., IS A SEPARATE CORPORATION HAVING THE SAME OFFICERS AS INVESTIGATIVE BUREAU, INC., - THE IDENTITY OF OFFICERS IS NOT, HOWEVER, MATERIAL (44 COMP. GEN. 564).'

WE HAVE HELD THAT THE ANTI-PINKERTON LAW IS A PROHIBITION AGAINST THE EMPLOYMENT IN GOVERNMENT SERVICE OF EMPLOYEES OF DETECTIVE AGENCIES AND IS APPLICABLE TO CONTRACTS WITH DETECTIVE AGENCIES AS FIRMS OR CORPORATIONS AS WELL AS TO CONTRACTS WITH OR APPOINTMENTS OF INDIVIDUAL EMPLOYEES OF SUCH AGENCIES. 8 COMP. GEN. 89; 38 ID. 881. AND WE HAVE ALSO HELD THAT THE CHARACTER OF SERVICES RENDERED BY A DETECTIVE AGENCY OR EMPLOYEES THEREOF MAY NOT BE RELIED UPON TO WORK AN EXCLUSION FROM THE PROHIBITION BUT THAT CONTRACTS WITH PROTECTIVE AGENCIES AND THEIR EMPLOYEES AS DISTINGUISHED FROM DETECTIVE AGENCIES ARE NOT WITHIN THE PURVIEW OF THE LAW. 26 COMP. GEN. 303; 41 ID. 819; 44 ID. 564. THIS BRINGS US TO THE QUESTION WHETHER THE STATEMENT CONTAINED IN THE BID OF INVESTIGATIVE BUREAU THAT THE COMPANY IS NOT A PINKERTON DETECTIVE AGENCY OR SIMILAR AGENCY, AS CONTEMPLATED BY THE 1893 ACT, NOR AN EMPLOYEE OF SUCH AGENCY, IS A FALSE STATEMENT WHICH RENDERED THE AWARD VOID.

ALTHOUGH WE MUST AGREE THAT INVESTIGATIVE BUREAU WAS NOT AN ELIGIBLE BIDDER UNDER THE INVITATION TERMS AND CONDITIONS SINCE IT WAS NOT QUALIFIED TO PERFORM AT THE DATE OF AWARD, WE DO NOT REGARD ITS CERTIFICATE OF COMPLIANCE WITH THE ANTI-PINKERTON STATUTE AS A FALSE STATEMENT. AT THE TIME THE CONTRACTOR EXECUTED THAT CERTIFICATE IN ITS BID, IT DID NOT HOLD ANY KIND OF LICENSE WHICH WOULD HAVE PERMITTED IT TO PERFORM DETECTIVE SERVICES. IN THE ABSENCE OF SUCH A LICENSE, THE FACT THAT THE CERTIFICATE OF INCORPORATION OF THE CONTRACTOR AUTHORIZED IT TO ENGAGE IN PRIVATE DETECTIVE AND INVESTIGATIVE WORK DOES NOT HAVE THE EFFECT OF MAKING THE CONTRACTOR A DETECTIVE AGENCY OR SIMILAR AGENCY UNDER THE PROHIBITORY STATUTE. SEE OUR MARCH 24, 1967, DECISION, SUPRA.

THERE WAS INVOLVED, THEREFORE, AN AWARD OF A CONTRACT TO A BIDDER WHO, BECAUSE OF ITS LICENSE DEFICIENCY, WAS NOT A RESPONSIBLE BIDDER AT THE DATE OF AWARD. HOWEVER, THAT DEFICIENCY, WHICH DID NOT AFFECT THE RESPONSIVENESS OF THE BID, WAS CORRECTED AND, AT THIS DATE, INVESTIGATIVE BUREAU IS NOT A PROHIBITED DETECTIVE AGENCY BUT IS LICENSED BY THE STATE OF NEW YORK TO PROVIDE GUARD SERVICES. HENCE, WHILE THE CONTRACT WAS, AT THE MOST, VOIDABLE BECAUSE OF THE LICENSING DEFICIENCY, IT IS APPROPRIATE AND NECESSARY TO GIVE GREAT WEIGHT TO THE PROCUREMENT AGENCY'S POSITION THAT IT DOES NOT BELIEVE THAT IT WOULD BE IN THE GOVERNMENT'S INTEREST TO NOW REGARD THE CONTRACT AS IN A PROHIBITED CATEGORY. HENCE, WE DO NOT BELIEVE THAT IT WOULD BE APPROPRIATE TO INVOKE RETROACTIVELY THE ANTI- PINKERTON STATUTE AS A BASIS FOR CANCELING THE CONTRACT WHICH IS NOW LEGALLY SUFFICIENT.