Could your business be banned from public contracting because of your views on controversial issues?

Sunday, November 26th, 2017

Could your business get banned from public contracting because of something controversial posted by someone associated with your business on social media?

For example, what if a member of your senior management posts a strong view on Facebook either for or against illegal immigration? Could someone in the government ban your firm from competing for a government contract because its political leadership holds the opposite view?

Chick-fil-A ran into this problem. In 2012, Chick-fil-A president Dan Cathy remarked in an interview that he was “guilty as charged” of believing marriage is solely between a man and a woman.

As a result, in 2015, some members of the Denver City Council opposed permitting Chick-fil-A to become a concessionaire at the Denver International Airport.

Ultimately, the council approved letting Chick-fil-A operate at the airport after the council declared itself satisfied that Chick-fil-A would not discriminate in its employment practices. One wonders if the marketplace popularity of Chick-fil-A played a role in that decision.

But what about businesses with less marketplace clout? In many cases you probably can’t be banned legally for what you say, but proving your case could be tough and expensive.

The Free-Speech Clause of the First Amendment controls this issue. Government employees and public contractors have some constitutional protection against being punished or terminated by the government because of their speech.

In 1996, the Supreme Court held that a county government couldn’t fire a waste-disposal contractor because of his criticisms of county officials. The court noted public employees have constitutional protections against being fired or disciplined for certain kinds of speech. In this case, it extended that limited protection to those holding existing government contracts.

The court declined to address whether the same free-speech rule applied to those bidding for government contracts. Yet, due to how that opinion was written, such protection almost certainly applies to bidders.

Still, winning a disappointed-bidder case against the government on free-speech grounds would be difficult.

You would have to show that the government nixed your contract bid because of your speech.
Unless you can point to a public statement by a government official to that effect, as was the case with Chick-fil-A, how would you prove that?

If you suspect but do not know that your bid got nixed because of something said, you would have to sue and go through expensive discovery to look for proof. That’s might not pan out.

And if you get that far, then you must convince a court that your speech was about a matter of public concern – an issue the general public cares about.

And if you cross that hurdle, the government could argue that its legitimate interests on the subject of your speech outweigh the free-speech interests at stake.

What constitutes an acceptable government justification is case specific. There is no bright-line rule here for what qualifies.

For example, if your company is bidding to supply photocopiers and service to a government agency, controversial views on immigration shouldn’t disqualify your bid. But if the government contract is for teaching classes on English-as-a-second-language, it might.

Also, in the end, the government could defeat your claim by showing you would not have gotten the contract regardless of what you said or published.

The bottom line is this area of the law is murky. Perhaps the Supreme Court eventually will clarify it.

Because of political wide divisions in our country, it is tempting for political partisans in power to bully and punish those who express opposing “unacceptable” viewpoints. Because of the large number of state and municipal governments and public universities, it’s nearly certain some government-contract bidder will get banned over a speech issue, and that contractor will push the issue through the courts.

The Supreme Court has shown strong, recent interest in free-speech issues. Just this summer it issued two rulings giving broad protection to speech.

My non-legal advice for those interested in government contracts is to try to avoid the situation. If you want to vent politically on social media, create an anonymous account using a non-identifying email address from Gmail, Hotmail, or the like. Then limit stuff you post in your own name to non-controversial matters. That’s cheaper than a risky, expensive lawsuit.

Written on November 21, 2017

by John B. Farmer

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