Other Transactions: A Flexible and Efficient Acquisition Tool for the Department of Defense

Scott Arnold and Samarth Barot 

On March 6, 2025, the Defense Secretary released a memorandum directing the Department of Defense (“DoD”) to adopt the Software Acquisition Pathway (“SWP”) to speed up the development, procurement, and delivery of software needed for weapons and business systems. Specifically, the memorandum directed DoD to use Commercial Solutions Openings and Other Transactions (“OTs”) as the default solicitation and award approaches for acquiring capabilities under the SWP. As a result, we are likely to see an expansion in DoD’s use of OTs. Thus, contractors should be aware of the rules and regulations regarding OTs.

Background

While OTs have been in the news a lot these days, they are not a new concept. OTs date back to 1958, when Congress granted the National Aeronautics and Space Administration (“NASA”) the authority to enter into transactions other than contracts, grants, or cooperative agreements in order to foster innovation and speed in the space race.

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Claims Court Breathes Life into Another Path to Protest OTAs

Merle M. DeLancey, Jr. ●

On Monday, February 24, 2025, the Court of Federal Claims (“COFC”) released the public version of a February 13 decision declining to dismiss Raytheon Company’s protest of a $648.5 million award under the Missile Defense Agency’s (“MDA”) interceptor development program. Judge Armando O. Bonilla held that the award was within the court’s jurisdiction over Other Transaction Authority agreements (“OTAs”).

Unsuccessful offerors have had difficulty finding a tribunal with jurisdiction over post-award protests involving OTAs. Under COFC and U.S. General Accountability Office (“GAO”) precedent, an offeror’s ability to protest an OTA award is limited. OTAs are not considered procurement contracts. They are considered non-traditional acquisitions usually involving innovative research and development or prototyping services. They are not based on the Federal Acquisition Regulation (“FAR”) or Defense Federal Acquisition Regulation Supplement (“DFARS”) and are not subject to the Competition in Contracting Act (“CICA”). Under CICA and the GAO’s Bid Protest Regulations, GAO’s bid protest jurisdiction is limited to protests concerning alleged violations of federal agency procurement statutes or regulations in the award or proposed award of contracts for the procurement of goods and services, and solicitations leading to such awards. Under the COFC’s Tucker Act bid protest jurisdiction, COFC’s review is limited to protests “in connection with a procurement or a proposed procurement.” Disappointed OTA competitors also have been unsuccessful seeking relief in U.S. Federal District Courts.

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