Introduction
On April 14, 2025, the U.S. Small Business Administration (SBA) Office of Government Contracting — Area II (Area Office) issued Size Determination No. SIZ-2025-140, dismissing a size protest filed by C4CJV, LLC (Appellant) against PCG-SMX JV, LLC (PCG-SMX). The Area Office found that the protest was nonspecific as required by regulations at 13 C.F.R. § 121.1007. On April 24, 2025, Appellant filed an instant appeal. Appellant contends that the Area Office erred in dismissing the protest, and requests that SBA’s Office of Hearings and Appeal (OHA) reverse or remand. For the reasons discussed infra, the appeal is denied, and the size determination is affirmed.
*1 OHA decides size determination appeals under the Small Business Act of 1958, 15 U.S.C. § 631 et seq., and 13 C.F.R. parts 121 and 134. Appellant timely filed the instant appeal on April 24, 2025. Accordingly, this matter is properly before OHA for decision.
Background
On March 14, 2024, the U.S. Department of Navy (U.S. Navy), NAWCAD Procurement Group (NAWCAD) issued Request for Proposals (RFP) No. N0042124R0009 for assistance with enterprise-wide applications, server, storage, data protection/recovery, data transport, and data environment engineering, operations, and hosting support services—Information Technology (IT) Enterprise Engineering, Operations, and Hosting Support Services (EEOHSS). The Contracting Officer (CO) set aside the procurement entirely for small businesses and designated North American Industry Classification System (NAICS) code 518210, Computing Infrastructure Providers, Data Processing, Web Hosting, and Related Services, with a corresponding $40 million annual receipts size standard (CO’s Memorandum). Appellant and PCG-SMX submitted timely offers.
Protest
On March 25, 2025, the CO informed Protestor (Appellant) that the contract had been awarded to PCG-SMX (Letter from A. Hensler III to M. Vodzak (March 25, 2025), at 1.) On April 1, 2025, Appellant filed a timely protest with the CO. The CO forwarded Appellant’s protest to the Area Office for review.
In its protest, Appellant contended that PCG-SMX does not satisfy the criteria required to be an eligible small business under the appropriate NAICS Code given the mentor-protégé joint venture formed between Perrygo Consulting Group, LLC (Perrygo) and Smartronix, LLC (Smartronix). (protest at 2.) Appellant claimed that both Perrygo and Smartronix are affiliated outside of the mentor-protégé relationship. Id. Appellant stated that Perrygo received about $14,266,387 from the NAWCAD prime contract over FY23, FY24, and FY25, but that upon information and belief, “passed through a significant portion of this revenue to Smartronix as Perrygo’s principal subcontractor.” Id.
Appellant alleged that prior to the award of this task order to Perrygo, nearly all of Perrygo’s revenue was derived from subcontracts, primarily from Smartronix. Id. Appellant alleged that 100% of Perrygo’s subcontract awards were from Smartronix in 2019. Id. Appellant further asserted six of eight of Perrygo’s 2020 subcontract awards were from Smartronix. Id. In 2021, 100% of Perrygo’s subcontract awards were from Smartronix. Id. In 2022, three of five of Perrygo’s subcontract awards were from Smartronix. Id. Appellant believes that while the precise amount of revenue from these subcontracts is unavailable, on information and belief, they exceed 70% of Perrygo’s revenue. Id. Appellant further asserts Perrygo received 32 subcontracts over the last 10 years, twenty-three of which were from Smartronix. Id. Moreover, Appellant cited to a LinkedIn page to state that Perrygo’s Chief Operating Officer (COO), Mr. John Kuchta, “came to Perrygo in 2022, after resigning as Smartronix’s Vice President of Business Development after a ~20 career as an officer of Smartronix.” (Id. at 2-3.) Appellant observed that Mr. Kuchta directs the activities of PCG-SMX on behalf of his current and immediate past employers. (Id. at 3.)…
Next, Appellant argued Perrygo is economically dependent through contractual or other relationships upon Smartronix, as demonstrated by the totality of circumstances….
…Consequently, as there is no supporting basis provided for the remaining allegations, the Previous protest is dismissed as not specific. (Id., citing Size Appeal of Wilson Walton Int’l, Inc., SBA No. SIZ-6031 (2019).)
Appeal
On April 24, 2025, Appellant filed an instant appeal. In Appellant’s view, the Area Office erred in dismissing Appellant’s protest and concluding that PCG-SMX is a small business and therefore eligible for award, by ignoring controlling law and the facts….
Conclusion
Appellant has not shown that the Area Office’s dismissal of Appellant’s Previous protest was based upon any error of fact or law. Accordingly, the appeal is DENIED, and the size determination is AFFIRMED. This is the final decision of the Small Business Administration. See 13 C.F.R. § 134.316(d).
Read The Full Decision Document Here.
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