RESPONDENT'S MOTION FOR SANCTIONS DENIED: February 25, 1993 GSBCA 12228-P BERKSHIRE COMPUTER PRODUCTS, Protester, v. DEPARTMENT OF THE ARMY, Respondent. Richard McGhee of Berkshire Computer Products, Natick, MA, appearing for Protester. Col. Riggs L. Wilks, Jr., Maj. Charles R. Marvin, Jr., and Capt. Sophia L. Rafatjah, Office of the Chief Trial Attorney, Department of the Army, Arlington, VA, counsel for Respondent. Before Board Judges PARKER, HENDLEY, and WILLIAMS. WILLIAMS, Board Judge. On December 18, 1992, protester Berkshire Computer Products (Berkshire) filed the instant protest challenging the Department of the Army's (Army's) solicitation of offers to supply Digital Equipment Corporation (DEC) brand name or equal automatic data processing equipment. Specifically, Berkshire claimed that only DEC's RA 92 disk drive and SA800 storage array and no "equal" equipment could meet the specifications, and thus that the agency violated the statutory and regulatory requirements for full and open competition. This matter comes before the Board on respondent's motion for sanctions. As grounds for this motion, respondent claims that protester's representative, Ernest J. Parsons, misrepresented his status as an employee of Berkshire and was not a proper party representative within the meaning of Board Rule 6. Originally, respondent sought to have this protest dismissed as a remedy for Mr. Parsons' alleged misrepresentation. However, during a subsequent telephonic conference, protester decided to withdraw its protest voluntarily, and a joint motion to dismiss the protest is pending. Respondent continues to press the motion for sanctions and requests that the Board enter an order "prohibiting Mr. Parsons from appearing before this Board in any capacity for one year." Respondent's Motion for Sanctions at 1; Respondent's Reply to Protester's Memorandum in Opposition to Sanctions. The facts pertinent to the instant motion are largely undisputed. Because Mr. Parsons was an unsalaried, part-time consultant to Berkshire, and was employed full time by LAGO Storage Technology during the pendency of this protest, he should not have been representing Berkshire here. However, for the reasons discussed below, we deny the motion for sanctions. Findings of Fact This protest was filed on December 18, 1992; Richard McGhee signed the protest. At a telephonic prehearing conference convened on December 28, 1992, both Richard McGhee and Ernest Parsons appeared on behalf of protester. During the conference, the judge expressly asked Mr. McGhee and Mr. Parsons whether they were employees of Berkshire and what their titles were. Both stated that they were Berkshire employees; Mr. McGhee replied that he was a contract specialist and Mr. Parsons that he was "a marketing manager." Affidavit of Ernest J. Parsons dated January 27, 1993, 7; Affidavit of Captain Sophia L. Rafatjah dated January 19, 1993, at 1; see also, Conference Memorandum dated December 28, 1992, at 1 ("Mr. Richard McGhee, Contract Specialist, and Mr. Ernest Parsons, Marketing Manager, Berkshire Computer Products, participated on behalf of protester."). During that prehearing conference, counsel for respondent stated that the Army would oppose protester's request for a suspension of respondent's delegation of procurement authority (DPA). Therefore, the Board convened a suspension hearing in Washington, DC, on December 29, 1992. The sole representative of protester during that hearing was Ernest Parsons. During the course of the hearing, Mr. Parsons testified as follows: Just some background information, Your Honor, my name is Ernest J. Parsons. I work for Berkshire Computer Products in the role of technical marketing manager. . . . Prior to this . . . I worked for [EMC Corporation] for approximately four years and came on in my present role with Berkshire, which I have been there an additional years (sic). Transcript at 300. On January 14, 1993, the Board convened a telephonic status conference in this protest. During that conference, Captain Rafatjah, counsel for the Army, stated that she had been informed by two representatives of LAGO Storage Technology (one of whom was LAGO Storage Technology's attorney), the manufacturer of the disk that Berkshire was proposing in this procurement, that Mr. Parsons did not work for Berkshire, but rather for LAGO Storage Technology. Conference Memorandum dated January 14, 1993, at 2. Mr. McGhee, who was the sole representative of protester during this conference, stated that Mr. Parsons "was not a salaried employee of Berkshire, but was a technical marketing consultant." Id. at 2. Mr. McGhee clarified that, as of the date of that conference, Mr. Parsons was no longer representing Berkshire. Id. Captain Rafatjah further indicated that respondent would be filing a motion for sanctions based upon Mr. Parsons' alleged misrepresentation of his employment status. The Board authorized the motion and ruled that the Board would convene a hearing on the motion if either party or Mr. Parsons requested a hearing. Order dated January 19, 1993, at 2. In support of the motion for sanctions, respondent submitted the affidavit of Captain Rafatjah, and she testified as follows: My telephonic discussions with LAGO Storage Technology personnel (Mr. Ronald Reynolds, Mr. Larry Pyle, and Mr. Dwight Seeley, Litigation Counsel for Storage Technology) uncovered Mr. Parsons' actual employment status. I had several conversations with Mr. Reynolds. Although new to the company, Mr. Reynolds, throughout the course of these conversations, made inquiries of his personnel to verify information. Based on his inquiries, Mr. Reynolds stated that Mr. Parsons was the LAGO Storage Technology sales representative for the Massachusetts and New York areas. Mr. Reynolds, also told me that apparently in the past, Mr. Parsons' relationship with Berkshire Computer Products had been an issue due to a potential conflict of interest. As a result of the prior incident, Mr. Parsons had assured LAGO Storage Technology that he was not employed by Berkshire Computer Products. Furthermore, Mr. Reynolds checked Mr. Parsons' employment file and observed that his employment contract contained the agreement not to engage in employment that could be considered a conflict of interest with LAGO Storage Technology. Affidavit of Captain Sophia L. Rafatjah dated January 19, 1993, at 1-2. In response to the motion for sanctions, Berkshire filed the affidavits of Richard J. McGhee, Contract Specialist; Edward J. Walsh, Vice President of Sales and Marketing; and Ernest J. Parsons. In a letter dated February 4, 1993, Berkshire represented that it did "not believe that a hearing in this matter is necessary," and Mr. Parsons did not request a hearing. In his affidavit filed in opposition to the motion for sanctions, Mr. Parsons testified as follows regarding his employment with Berkshire and LAGO Storage Technology: 1. I was employed by Berkshire Computer Products from December of 1988 until April of 1990 as the Director of Sales and Marketing. 2. In April of 1990 I accepted a position with LAGO Systems, Inc. as the Regional Manager located in Natick, Massachusetts. I held this full-time position with LAGO until January of 1993. LAGO Systems manufactured and marketed SDI/STI disk/tape adaptors and subsystems to value added resellers, distributors and Fortune 1000 companies. Due to the high demand on my time I resigned my position as Vice President/Manager of Sales and Marketing, but agreed to stay as a part- time employee to assist in the integration formatting and testing of Berkshire's LS series disk and tape drives. 3. In the late spring of 1992, LAGO Systems modified its product offerings and began focusing on the sale of a tape library solution that was not specific to the DEC market it had been involved with for the past several years. LAGO Systems shortly thereafter . . . agreed to phase out of the DEC SDI/STI market, and to cease the sale and manufacturing of the subject products on or before December 31, 1992. 4. Immediately [thereafter] . . . LAGO Systems and Storage Technology Corp. entered into an agreement whereby LAGO Systems was acquired by Storage Technology Corp. LAGO Systems specific focus was to design, manufacture and market 8mm tape libraries (DataWheel) to the PC, workstation and midrange computing environments. This new focus did not in any way overlap or compete with LAGO Systems past SDI disk market and was an entirely new focus. 5. When LAGO Systems changed its marketing focus from SDI storage products to 8mm tape libraries, Berkshire requested assistance in marketing complete systems that included the LS series storage products. I agreed to the responsibilities on a part-time (evenings) basis provided the sales opportunities incorporated some of LAGOs older SDI products/adaptors. Affidavit of Ernest J. Parsons dated January 27, 1993, at 1-5. Berkshire's contract specialist testified as follows regarding his relationship with Mr. Parsons at Berkshire: Throughout my employment at Berkshire which began in December of 1990, I have interfaced with Mr. Parsons on matters specifically related to the integration, functionality and performance of the LAGO LS Series storage products. Since July of 1992, Mr. Parsons has reviewed and directed Government systems procurements I was involved with so long as these procurements included the sale of LAGO LS series storage products along with the Berkshire supplied disk controllers/I/O servers. Affidavit of Richard J. McGhee dated January 27, 1993, at 5-6. Berkshire's vice president confirmed that Mr. Parsons was employed at Berkshire as a full-time employee until April of 1990. Affidavit of Edward J. Walsh dated January 27, 1993, at 3. He further explained Mr. Parsons' employment history as follows: In April of 1990 Mr. Parsons resigned as Director of Sales and Marketing to pursue a position with LAGO Systems Inc. Mr. Parsons did work part-time after this date (evenings and weekends) assisting Berkshire in the integration, formatting and testing of Berkshire supplied LS series storage products. Berkshire has been a large customer of LAGO Systems since 1989 and his increased LAGOs sales, customer base and profitability by Berkshire's sales of storage products. . . . In the late spring of 1992 . . . Berkshire asked Mr. Parsons to assist in the marketing of Digital VAX computer systems to Government agencies. After some discussion, Mr. Parsons agreed that he would take on the additional responsibilities so long as the systems Berkshire was providing included some of the LAGO Systems manufactured SDI/STI tape adapters which LAGO wanted to sell out of inventory, and that he could perform the occasional task on a part-time basis (working evenings and during Mr. Parsons free time). Affidavit of Edward J. Walsh dated January 27, 1993, 4-6. Ernest J. Parsons represented Berkshire in other cases before this Board after leaving Berkshire in April of 1990. Specifically, Mr. Parsons is listed as a representative of Berkshire, the protester, in: Berkshire Computer Products v. Department of Health and Human Services, GSBCA 12085-P, 1992 BPD 363 (Nov. 24, 1992), where his title was Marketing Manager; Berkshire Computer Products v. United States Navy, GSBCA 12063-P, 1992 BPD 291 (Oct. 14, 1992), where his title was Marketing Manager; Berkshire Computer Products v. United States Navy, GSBCA 11989-P, 1992 BPD 257 (Sept. 17, 1992), 1992 BPD 270 (Sept. 28, 1992), where no title was indicated; Berkshire Computer Products, GSBCA 10685-P, 1990 BPD 172 (July 5, 1990), where his title was Director of Sales and Marketing; and Berkshire Computer Products, GSBCA 10617-P, 1990 BPD 111 (May 10, 1990), where his title was Director of Sales and Marketing. In GSBCA 12085-P, Mr. Parsons testified before the Board on November 10, 1992. Regarding his employment with Berkshire, he stated: THE WITNESS: To give you a little bit of my background, Your Honor. JUDGE HENDLEY: Surely. THE WITNESS: I have been in the ADP industry and particularly in the digital VAX storage and upgrade market since 1985. My formal educational background, I have a management's degree with a concentration in computer science and graduate of Western New England College with a Bachelor's of Science Degree. From that point, I worked for a company, EMC Corporation or EMC-2 . . . . From there I went over to Berkshire Computer Products, which I am still with today, and at Berkshire I work with bringing new products to market and also in the Government procurements area. Transcript, GSBCA 12085-P at 15-16; Respondent's Reply to Protester's Memorandum in Opposition to Sanctions, Exhibit 6. Also, in GSBCA 12085-P, Berkshire, in answers to interrogatories twice stated Mr. Parsons' title to be "Government Procurement Specialist." Protester's Answers to Respondent's Interrogatories, GSBCA 12085-P at Responses 8 and 9; Affidavit of Richard S. Brown dated February 2, 1993, Attachment 4. Mr. Parsons did not disclose to the Board in any of these cases that he was a full-time employee of LAGO Storage Technology. Discussion We first consider whether we possess the authority to impose the sanction which respondent seeks -- a one-year prohibition against Berkshire's unsalaried consultant appearing here -- which is essentially a disciplinary measure against an individual party representative. While this Board has repeatedly recognized that its members possess the inherent authority to impose sanctions, the Board has never squarely addressed its authority to discipline an individual party representative. Compuline International, Inc. v. Department of Commerce, GSBCA 12069-P, 1992 BPD 343 (Oct. 22, 1992); Sterling Federal Systems, Inc., GSBCA 10381-P, 1990 BPD 122 (May 17, 1990); International Technology Corp., GSBCA 10056-C(10010-P), 1990 BPD 2 (Oct. 16, 1989); Systems Management American Corp., GSBCA 9773-P, 89-3 BCA 21,945, 1989 BPD 161. We do so here, and conclude that the Board may discipline individual party representatives so long as the Board's procedure affords the individual "such notice and opportunity for a hearing as would constitute due process." Goldsmith v. United States Board of Tax Appeals, 270 U.S. 117, 123 (1926).[foot #] 1 Here, protester and Mr. Parsons were notified of respondent's requested sanction in writing and were offered an opportunity for a hearing on the record, but declined. They responded to the motion, filing documentation which included three affidavits. The requirements for notice and an opportunity to be heard have thus been satisfied. We next address the issue of whether to impose any sanction on Mr. Parsons. As we recognized in Sterling Federal Systems, Inc., GSBCA 10381-P, 1990 BPD 122, at 4 (May 17, 1990): "any sanction should bear some relevance to the offense and the offender, while being prophylactic in nature." The offense here was Mr. Parsons' failure to describe fully his employment status when asked by a member of this Board and when testifying under oath. Mr. Parsons' consistent representations that he was employed by Berkshire without ever mentioning LAGO Storage Technology created the misimpression that he was in fact employed full time by Berkshire Computer Products. Mr. Parsons' employment status is critical in assessing his ability to represent a corporation before this Board as a non- attorney. Rule 6(a)(1) provides: Appellant; petitioner; protester; intervenor. Any appellant, petitioner, protester, or intervenor may appear before the Board by an attorney at law licensed to practice in a state, commonwealth, or territory of the United States, in the District of Columbia, or in a foreign country. Alternatively, an individual appellant, petitioner, protester, or intervenor may appear in his own behalf; a corporation, trust, or association may appear by one of its officers or by any other authorized representative; and a partnership may appear by one of its members or by any other authorized representative. 48 CFR 6101.6 (1991). ----------- FOOTNOTE BEGINS --------- [foot #] 1 In Systems Management American Corp., 89-3 BCA __________________________________ at 110,373, 1989 BPD 161, at 6, we recognized that the Board "has the authority to preclude counsel from appearing before the _______ Board for a fixed period." ----------- FOOTNOTE ENDS ----------- In Texas Carbon Ribbon, Inc., GSBCA 9905-P, 89-2 BCA 21,654, 1989 BPD 55, this Board made it clear that, under Rule 6, a non-attorney who is not an employee of a party corporation may not represent that corporation before the Board even if expressly authorized by the corporation to do so. We explained: In context, the purpose of this clause [in Board Rule 6(a)(1)] is to provide corporations, associations and partnerships a parallel privilege of pro se representation such as is accorded the individual party appearing before the Board. The individual party is not permitted under this rule to retain a non-party, non- attorney to participate in proceedings before the Board, and this rule does not grant such an option to the corporation, association or partnership. The use of the term "authorized representative" was simply intended, at most, to allow a corporation to authorize an appropriate employee who is not an officer to appear on its behalf before this Board. 89-2 BCA at 108,932, 1989 BPD 55, at 2. In essence, Mr. Parsons and Berkshire claim that because Mr. Parsons was a "part-time employee" of Berkshire and was authorized to represent the company before the Board, he was competent to do so. We disagree. We question whether an unsalaried consultant who works for a company in his spare time while employed full-time for another entity would in the legal sense qualify as an "employee" of the company. See, e.g., Newcomb v. North East Insurance Co., 721 F.2d 1016, 1017 (5th Cir. 1983); Matcovich v. Anglim, 134 F.2d 834, 837 (9th Cir. 1943) (economic dependency and payment of wages are indicia of employment relationship). In any event, we now hold that for purposes of Board Rule 6, a firm may not be represented at this Board by an unsalaried "employee/consultant," who is employed full time elsewhere. Returning now to the matter of sanctions, we conclude that Mr. Parsons was less than candid in representing his employment status to the Board in that he completely omitted any reference to his full-time employer, LAGO Storage Technology, when asked whether he was an employee of Berkshire. He did so twice again when testifying under oath describing his employment background, stating only that he was working for Berkshire, without disclosing that it was both unsalaried and part-time or that he was a sales representative covering two states for another company. Such omissions, while troubling, do not warrant the imposition of sanctions here. In declining to impose sanctions as urged by respondent, we note that the record does not demonstrate that Mr. Parsons intentionally misrepresented his employment status in order to qualify as a party representative. Importantly, our Rule 6 is not clear that only an employee can represent a party; on its face the rule permits representation by "any other authorized representative." We, thus, would have to charge a pro se litigant with prior knowledge of our construction of Rule 6 in the Texas Carbon Ribbon case -- which we deem inappropriate. Decision The motion for sanctions is DENIED. _____________________________ MARY ELLEN COSTER WILLIAMS Board Judge We concur: ____________________________ ____________________________ ROBERT W. PARKER JAMES W. HENDLEY Board Judge Board Judge