NSTXL Statement on Washington Post Story

NSTXL is honored to have been selected by the Space and Missile Systems Center’s (SMC) Space Development Corps to manage the Space Enterprise Consortium (SpEC), which will ensure U.S. space dominance. The NSTXL innovation platform will bring advanced capabilities and offerings in support of SpEC and the many innovative member entities to facilitate rapid technology development and deployment. We are proud of our many successes to date on driving new innovations in support of mission, including some covered by the Washington Post.

NSTXL was disappointed that the Washington Post story about the SpEC award focused on using a dispute with a former vendor—not the government or any performer providing services to the government—to cast doubt on the use of the OTA contracting mechanism in defense innovation. The story highlighted an ongoing civil matter regarding a contract dispute with a former events and conference vendor that was terminated nearly three years ago and that has no relationship whatsoever with our ongoing work with the Department of Defense.

The Post story is rife with incorrect interpretations, misstated findings from court documents, and displays a blatant disregard for the inconsistent findings of the court. In particular, the Post story completely ignores key findings that contradict those that the Washington Post chose to cherry pick and write about.

Litigation is sometimes an unfortunate part of severing ties with a services vendor. The matter in question concerns the non-performance of a vendor under a 2014 services agreement between a vendor and NSTXL. A Texas state civil court erroneously determined otherwise--and NSTXL will appeal any final judgment based on the current findings.

What the Washington Post failed to articulate for the reader includes:

  • This is a civil matter about a business contract dispute as the Post’s own external sources acknowledged in the story.
  • NSTXL did inform its existing government customers of the ongoing contract dispute.
  • The lawsuit does not involve or in any way implicate NSTXL’s work with any government office or its performance on any Other Transaction Authority (OTA) program or project agreement.
  • This litigation is not and has never been a case about fraud. There were no fraud claims asserted against NSTXL in the lawsuit, and no findings of fraud by NSTXL against any government entity, our members, or any performer under any OTA agreement.
  • Any characterization of NSTXL having been found to have acted fraudulently by the Washington Post is both irresponsible and fundamentally inaccurate on its face.
The Post makes a number of mischaracterizations and gets the facts of the case incorrect. For example, the court’s ruling has nothing to do with NSTXL shifting the event vendor’s scope of work to another entity. The event vendor’s scope of work was never sent to NSTXL-NC. Instead, the terminated event vendor’s scope of work has been executed by NSTXL and with far greater success and results.

In fact, had the Washington Post carefully reviewed and fairly represented the court’s findings, it would have seen and reported that all actions to which the court alludes in its findings relating to NSTXL-NC related to a transaction that occurred at a point after which the court had determined NSTXL had no obligation to the terminated vendor. Thus, the finding of misuse of the corporate form is incorrect and invalid on face as a matter of both fact and law as the court found that there was no obligation to avoid. Despite it being brought to their attention, the Washington Post chose not to mention these key, and contradictory, findings.

In terms of journalistic fairness, the Post demonstrated that it was lacking in another key way. The Post provided NSTXL with only 24 hours to respond to a set of questions to an ongoing civil matter on Christmas week and then did not provide even half that amount of time to respond to a set of follow-up questions before posting the story with no advance notice.

In spite of this matter, NSTXL has continued to grow, innovate, and expand our offerings to both the Government and our membership in support of Warfighter mission. We have delivered top innovations, some of which have even been covered by the Post as referenced earlier. For its part, NSTXL will move forward with enthusiasm and optimism. NSTXL has continued to grow, innovate, and expand its offerings to both the Government and our membership in support of Warfighter mission, and is energized as to the great work ahead.

Please contact shelley@nstxl.org for further questions.