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Pentagon Headed to Court Against Small Business Advocate

Judge sets December trial for unfulfilled FOIA request on mystery contracting program.

A small-business advocate has won a day in court with Pentagon attorneys to argue whether the Defense Department should release shielded internal documents that the plaintiff argues will reveal a government bias against small defense contractors.

Lloyd Chapman, founder of the Petaluma, Calif.-based American Small Business League, for years has sought to expose the workings of the 28-year-old Comprehensive Subcontracting Plan Test Program designed to “determine if comprehensive subcontracting plans on a corporate, division or plant-wide basis [instead of for individual contracts] would lead to increased opportunities for small businesses.”

Chapman argues the program covers up ways in which large contractors get work intended for eligible small businesses, and even the Pentagon has expressed a desire for Congress to terminate the program as not effective in organizing contact awards.

On April 12, the small business league announced a new stage in its ongoing suit against the helicopter maker Sikorsky Aircraft Corp. (acquired by  Lockheed Martin in 2015) and the DOD. U.S. District Court Judge William Alsup of the Northern District of California, last week set December as the time for a full trial that will include discovery and as many as 10 depositions from the Defense Department on the mysterious program. “The ASBL believes the release of the information will prove the Pentagon has defrauded small businesses out of over two trillion dollars in subcontracts since the program was established in 1989,” the league said.

Sikorsky had appealed a 2014 loss in district court to the 9th Circuit, which this January ruled in favor of the company and the Pentagon. During the litigation, the league reported, Sikorsky argued that parent company Lockheed Martin was a competitor that would gain an unfair advantage with the release of the information submitted to the CSPTP.

But when the 9th Circuit Court remanded the case back to the District Court this January, the league was given an opportunity by the Justice Department to press for a trial—considered unusual in FOIA cases. "So it would be more like a David and Goliath,” the district judge said in a 2014 hearing described by the league. “You get to come in there and be the underdog again against the big company and against the big government. They are trying to suppress the evidence."

A spokesman for Sikorsky told Government Executive that “at this time Sikorsky is not a party to the ongoing case and has no additional comment.”

A Pentagon spokesman said the department does not comment on pending litigation.

Chapman told Government Executive that he is emotional over what he called a “historic” development.

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