“Equal Justice Under Law.” Those words are engraved above the entrance to the United States Supreme Court building. They express an aspirational goal rarely achieved. The dispensing of “justice” is, more often than not, unequal. It is no secret that in litigation rich people have a great advantage over the less affluent. Or to put it in contemporary terms, the one percent has a big advantage over the ninety-nine percent. Just to illustrate the point, I recall a story that a friend told me long ago. One day he was in the federal courthouse at Foley Square in Manhattan. It was at a time when the paparazzi were pestering Jackie Kennedy Onassis, and she was in the midst of litigation against one of the paparazzi. My friend peeked into the courtroom, and there was Jackie Onassis sitting at counsel table with no less than six lawyers from a large, blue-stocking New York law firm. Can most people afford that style of representation? Obviously not! When it comes to legal disputes, big, well-heeled litigants can not only grind down less well-financed adversaries, but they are also far better able to defend against actions by the government, such as debarment. Justice is not exactly equal.
The lack of equal justice certainly applies to the debarment system. Big contractors have a huge advantage. The government rarely debars big contractors, or even proposes them for debarment; and that is not just because big contractors are clean as a whistle. The disparity results mainly from the sheer size and “market power” of big contractors. Big contractors employ thousands of people; they have operations in multiple states; they perform many contracts; they have numerous subcontracts; they have plenty of lawyers and lobbyists on retainer; they have political clout. Debarring a large contractor would throw many people out of work, adversely affect important government programs, and create headaches for elected officials and political appointees. So, it just isn’t done. Several years ago, I heard a government official make an astonishing statement, astonishing for its candor and truth. He said: “If a small contractor does something wrong, we will debar the contractor; if a big contractor does something wrong, we will work it out.” There it is! Big contractors can rest easy, but small contractors, watch out. More often than not, debarment is lethal for small contractors. If debarred, or even proposed for debarment, a contractor cannot be awarded new business – no new contracts, task orders, options, etc. – and that includes subcontracts. (FAR 9.405) Debarment cuts off a contractor’s oxygen supply, and suffocation follows. The period of debarment is typically three years, and three years without new government business will end the life of most small government contractors.