SEC awards $39.3M for electronic discovery support, with 3 bidders competing

Contract Overview

Contract Amount: $39,340,370 ($39.3M)

Contractor: 3A, LLC

Awarding Agency: Securities and Exchange Commission

Start Date: 2021-09-02

End Date: 2026-08-31

Contract Duration: 1,824 days

Daily Burn Rate: $21.6K/day

Competition Type: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Number of Offers Received: 3

Pricing Type: LABOR HOURS

Sector: IT

Official Description: ELECTRONIC DISCOVERY SUPPORT OF LITIGATION (EDSL)

Place of Performance

Location: WASHINGTON, DISTRICT OF COLUMBIA County, DISTRICT OF COLUMBIA, 20549

State: District of Columbia Government Spending

Plain-Language Summary

Securities and Exchange Commission obligated $39.3 million to 3A, LLC for work described as: ELECTRONIC DISCOVERY SUPPORT OF LITIGATION (EDSL) Key points: 1. Contract value appears reasonable given the scope of electronic discovery support for litigation. 2. Full and open competition suggests a healthy market for these services. 3. The contract duration of 1824 days indicates a long-term need for these specialized services. 4. The use of labor hours pricing can introduce cost variability. 5. This contract supports critical litigation functions within the SEC. 6. The contractor, 3A, LLC, is providing specialized IT services.

Value Assessment

Rating: good

The total award amount of $39.3 million over approximately five years for electronic discovery support is within a reasonable range for federal litigation support services. Benchmarking against similar contracts for e-discovery and litigation support reveals that pricing for specialized services like data collection, processing, review, and production can vary significantly based on volume and complexity. Without specific details on the volume of data or the complexity of the litigation, a precise per-unit cost comparison is difficult. However, the overall award size suggests a substantial and ongoing need for these services by the SEC.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

This contract was awarded under 'Full and Open Competition After Exclusion of Sources,' indicating that the solicitation was broadly advertised, and multiple responsible sources were permitted to submit offers. With three bidders participating, the competition level suggests a moderately competitive environment. This level of competition is generally sufficient to promote price discovery and encourage contractors to offer competitive pricing, though a higher number of bidders could potentially drive prices lower.

Taxpayer Impact: The moderate competition level is beneficial for taxpayers as it likely resulted in a more competitive price than a sole-source award. It ensures that the SEC is receiving services from a qualified vendor at a price influenced by market forces.

Public Impact

The Securities and Exchange Commission (SEC) benefits directly through enhanced capabilities in managing and processing large volumes of electronic data for litigation. Services delivered include crucial support for legal proceedings, ensuring efficient and effective discovery processes. The geographic impact is primarily within the District of Columbia, where the SEC is headquartered, but the digital nature of the services can support cases nationwide. The contract supports a specialized workforce in the field of electronic discovery and litigation support.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for cost overruns due to the labor hours pricing model if not closely managed.
Dependence on a single contractor for critical litigation support functions.
The complexity of e-discovery can lead to unforeseen challenges and scope creep.

Positive Signals

Awarded through full and open competition, indicating a competitive bidding process.
The contractor, 3A, LLC, is providing specialized services essential for SEC's mission.
The contract duration suggests a stable and predictable need for these services.

Sector Analysis

The electronic discovery (e-discovery) market is a significant segment within the broader legal technology and IT services sector. It encompasses software, hardware, and services used to identify, collect, process, review, and produce electronically stored information (ESI) for legal matters. Federal agencies, particularly those involved in extensive litigation or regulatory enforcement like the SEC, are major consumers of these services. The market is characterized by a mix of large, established legal technology providers and smaller, specialized e-discovery firms. Spending benchmarks for e-discovery services can vary widely based on data volume, complexity, and the specific services required.

Small Business Impact

This contract does not appear to have a specific small business set-aside. The award to 3A, LLC, does not inherently exclude small business participation, as larger prime contractors often utilize small businesses for subcontracting. However, without explicit set-aside provisions or detailed subcontracting plans, the direct impact on the small business ecosystem for this specific contract is not immediately clear. Further analysis of subcontracting reports would be needed to assess the extent of small business involvement.

Oversight & Accountability

Oversight for this contract would primarily reside with the contracting officer and the relevant program officials within the Securities and Exchange Commission. Accountability measures are typically embedded in the contract terms and conditions, including performance standards, reporting requirements, and payment schedules tied to deliverables. Transparency is facilitated through contract award databases like FPDS-NG, which provide public access to contract details. The Inspector General's office of the SEC may also conduct audits or investigations related to contract performance and financial integrity.

Related Government Programs

Legal Services
Litigation Support
Information Technology Services
Electronic Data Discovery
Federal Law Enforcement Support

Risk Flags

Potential for cost overruns due to labor hour pricing.
Data security and privacy risks inherent in handling sensitive litigation data.
Contractor performance variability.

Frequently Asked Questions

What is this federal contract paying for?

Securities and Exchange Commission awarded $39.3 million to 3A, LLC. ELECTRONIC DISCOVERY SUPPORT OF LITIGATION (EDSL)

Who is the contractor on this award?

The obligated recipient is 3A, LLC.

Which agency awarded this contract?

Awarding agency: Securities and Exchange Commission (Securities and Exchange Commission).

What is the total obligated amount?

The obligated amount is $39.3 million.

What is the period of performance?

Start: 2021-09-02. End: 2026-08-31.

What is the track record of 3A, LLC in providing electronic discovery services to the federal government?

Information regarding the specific track record of 3A, LLC in providing electronic discovery services to the federal government can be found by analyzing their past performance on similar contracts. Federal procurement databases often contain details on previous awards, contract values, and performance ratings. A review of these records would reveal the extent of their experience, the types of agencies they have served, and any documented successes or challenges. For this specific contract, the SEC's selection of 3A, LLC implies a positive assessment of their capabilities and past performance, but a deeper dive into their contract history would provide a more comprehensive understanding of their expertise and reliability in the e-discovery domain.

How does the per-unit cost of this contract compare to similar e-discovery services procured by other federal agencies?

A direct per-unit cost comparison for this contract is challenging without granular data on the volume of data processed, the number of documents reviewed, and the specific services rendered (e.g., data ingestion, culling, review, production). Federal e-discovery contracts often use labor hour rates or fixed-price components for specific tasks. To benchmark effectively, one would need to compare rates for similar roles (e.g., project managers, senior reviewers, technicians) and task-based pricing for services like data processing or hosting against contracts awarded by agencies like the Department of Justice or other regulatory bodies. Publicly available contract data can provide average rates, but significant variations exist due to contract size, duration, geographic location, and specific requirements.

What are the primary risks associated with this contract, and how are they being mitigated?

Primary risks for this electronic discovery support contract include potential cost overruns due to the labor hours pricing model, which can be difficult to forecast precisely. Another risk is the potential for scope creep if litigation needs evolve unexpectedly. Data security and privacy are also critical risks, given the sensitive nature of legal documents. Mitigation strategies likely include robust project management, detailed work breakdown structures, regular performance reviews, strict change control processes, and adherence to stringent data security protocols mandated by the SEC. The contract's defined period and delivery orders also provide some control over expenditure and scope.

How effective has 3A, LLC been in meeting the performance requirements of this contract to date?

Assessing the effectiveness of 3A, LLC in meeting the performance requirements of this contract requires access to performance reports, quality assurance reviews, and feedback from the SEC's contracting officer's representative (COR). As this contract was awarded in September 2021 and runs through August 2026, there is likely a performance history available. Publicly accessible contract databases may contain performance ratings or indicate if any contract disputes or issues have arisen. Without direct access to these internal performance metrics, a definitive statement on their effectiveness cannot be made, but the continued execution of the contract suggests satisfactory performance.

What has been the historical spending pattern for electronic discovery support services at the SEC?

Analyzing historical spending patterns for electronic discovery support at the SEC would involve examining contract data over several fiscal years. This would reveal the total amount spent on e-discovery, the number of contracts awarded, the primary contractors utilized, and the average contract values. Such an analysis could indicate whether spending has been consistent, increasing, or decreasing, and whether the SEC relies on a few key vendors or a broader range of providers. Understanding these patterns helps in assessing the long-term resource allocation for litigation support and identifying potential trends in the volume or complexity of cases requiring e-discovery.

What is the typical duration and value of similar e-discovery contracts awarded by federal agencies?

Typical durations for federal e-discovery contracts can range from one to five years, often with option periods. Contract values vary significantly based on agency size, caseload, and the scope of services. Smaller agencies might award contracts in the low millions, while larger agencies like the Department of Justice or the SEC could award contracts in the tens of millions, similar to this $39.3 million award. Contracts often include base periods and multiple option years, allowing flexibility. The use of delivery orders against indefinite-delivery/indefinite-quantity (IDIQ) vehicles is also common, providing a framework for procuring services as needed.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Computer Systems Design and Related Services › Computer Systems Design Services

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION AFTER EXCLUSION OF SOURCES

Solicitation Procedures: SUBJECT TO MULTIPLE AWARD FAIR OPPORTUNITY

Offers Received: 3

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 1749 OLD MEADOW RD STE 400, MCLEAN, VA, 22102

Business Categories: Category Business, Limited Liability Corporation, Minority Owned Business, Not Designated a Small Business, Partnership or Limited Liability Partnership, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Indian (Subcontinent) American Owned Business, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $86,201,421

Exercised Options: $39,340,370

Current Obligation: $39,340,370

Actual Outlays: $33,811,453

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Parent Contract

Parent Award PIID: 50310219D0001

IDV Type: IDC

Timeline