Smokey Bear Baseballs

Programming note: Hang on. I go on vacation and I come back and the SBA shut down the 8(a) program?!?! I guess I'll talk about that next week because, yeesh, there's a lot to cover there. And I'm still warming back up after vacay. So today we talk baseballs.

Let's talk baseballs. Specifically, let's talk about the baseballs purchased by the Government Publishing Office on behalf of the US Forest Service that were the subject of a recent GAO decision.

The GPO needed to buy 12,010 baseballs[1] with the logo of Smokey Bear printed on them. Why Smokey Bear? Clearly, it's because he's lovable and a national symbol. Why baseballs? Apparently it's because the baseballs would also bear the delightful slogan: "Strike Out Wildfires!"[2]

Anyway, to procure said Smokey Bear baseballs, GPO put out a purchase order in June 2021, with an expected delivery by September 1, 2021.[3] And Eagle Group bid and won. But, it's important to appreciate that Eagle Group doesn't actually make baseballs. Instead, Eagle "subcontracted the production of these balls to a supplier in China, who produced prior to production samples and further shipped the entire order via ocean freight to the contact in the United States." Eagle is what you might call a value-added reseller.

Before going further, I want to just take a moment and admire the indirection involved here. The ultimate purchaser of the baseballs was the Forest Service, which contracted with the GPO, which contracted with Eagle, which contracted with a Chinese supplier. Fine, whatever. That's how supply chains work, I guess.

Anyway, Eagle handled the process of getting the baseballs and approvals. In June 2021, the Forest Service signed off on the pre-production baseballs and those 12,010 baseballs were put on a cargo ship bound for the US. But Eagle hit a snag; at some point, the Smokey Bear baseballs went missing. And spoiler alert, they never arrived. Which means that somewhere out there, folks, there are 12,010 Smokey Bear baseballs with the slogan "Strike Out Wildfires!" on them.[4]

Things continued to go sideways. Between October 2021 and April 2022, Eagle attempted to recover the Chinese-manufactured baseballs, have a second printing 8,000 baseballs in China, and have 4,000 baseballs printed in the United States. Why 4,000 in the US and 8,000 in China? Because “the costs were 300% more making the balls in the United States.” Woof.[5]

Unfortunately though, when the Made in the USA Smokey Bear baseballs arrived at the Forest Service in March 2022, the government rejected the order because the "Strike Out Wildfires!" text was too small... Oh no! By April 2022, almost a year after the purchase order was awarded, approved baseballs still hadn't arrived.

You might predict how this all ended: the GPO terminated the contract for default. But not because of the delay! Instead, the actual justification for terminating the contract is that because, in April 2022, GPO asked Eagle to provide written confirmation from the Chinese supplier by April 20th that the baseballs were in production and would be delivered in May 2022. And Eagle never sent a written confirmation from the Chinese supplier to the GPO! On April 22, GPO terminated by default.

See, that's the thing about government contracting. By law, the government cannot terminate for default if the failure to perform is "excusable." The law provides that "for nonperformance to be excusable, it must be beyond the reasonable control of the contractor and without fault or negligence."

And here, even though it had been almost a year of delay and no baseballs, Eagle was theoretically still in the game because the failure to deliver baseballs was effectively beyond its control. Regardless of all of the orders and reorders and lost baseballs and whatnot, in the end, Eagle took the L because it failed to obtain adequate written confirmation from its subcontractor.[6]

Which is today's lesson about government contracting: the law can let you play extra innings as long as you don't commit an error.

Them's the breaks.

[1] Why 12,010 baseballs? According to GAO, there were 10 sample baseballs. But a thing I keep wondering is why did they need 12,000 baseballs and not, say, 11,090 baseballs with an additional 10 sample baseballs? Are there pricing thresholds for custom baseballs where 12,010 made more sense than 12,000? Is it because they ship in packs of 12? These little mysteries bring me joy.

[2] Ahahaha. Yes, reader. The United States government formally endorses Dad Jokes, and I've got the receipts.

[3] Why September, though? Was the Forest Service trying to capitalize on the playoffs that would take place in October? Are baseballs the sort of promotional material that have year round value? Oh, come on. The right answer is obviously: "the end of the fiscal year."

[4] Actually, more! One curiosity is that Eagle claimed that it had delivered 3,000 baseballs "in good order" to the Forest Service but never got paid for them. These were the Made in the USA baseballs we'll talk about in a bit. Still, there's a factual dispute as to whether Eagle delivered 3,000 baseballs or 996 baseballs. But, whatever... this tells me that there are actually at least 13,000 Smokey Bear baseballs out there and maybe as many as 15,000. What a world!

[5] Originally, I was going to write a post about how maybe the Buy American Act (BAA) should cover these baseballs. But one friend noted that maybe customized baseballs are commercial-off-the-shelf products that are not covered under the BAA? Or maybe the BAA didn't apply for some other reason. But I don't really need to speculate because a 3x price difference would absolutely mean that the BAA would not seriously be implicated.

[6] Close readers of the opinion might rightly object to this assertion. The GAO primarily found that Eagle breached the contract by failing to get prior approval from Forest Service and because the font was too small. But, in my mind, (a) that's a way less interesting story; and (b) the way that GAO discusses the additional back-and-forth between GPO and Eagle suggests that, arguably, if Eagle had provided written confirmation in April 2022 of manufacture and May delivery, GPO would not have been allowed at that point to terminate for default. We'll just have to speculate.

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