B-165965, MAY 21, 1969

B-165965, MAY 21, 1969

TO LIEUTENANT COLONEL J. R. KELLIHER:

FURTHER REFERENCE IS MADE TO YOUR LETTER OF DECEMBER 19, 1968, REQUESTING A DECISION (AIR FORCE REQUEST NO. DO-AF-1028) AS TO WHETHER THE ACTIVITIES OF LIEUTENANT COLONEL FREDERICK H. G. SAHL, USAF, RETIRED, AS INDICATED IN THE ENCLOSURES, CONSTITUTED "SELLING" WITHIN THE MEANING OF 37 U.S.C. 801 (C) SO AS TO PRECLUDE PAYMENT OF RETIRED PAY.

YOU SAY IN YOUR LETTER THAT COLONEL SAHL WAS RETIRED JUNE 30, 1964, AND THAT HE WAS EMPLOYED BY THE V. H. MONETTE AND COMPANY, SMITHFIELD, VIRGINIA, DURING THE PERIOD JULY 13, 1964, THROUGH SEPTEMBER 28, 1965, AS ADMINISTRATIVE ASSISTANT TO THE PRESIDENT AND VICE PRESIDENT. YOU ALSO SAY THAT YOU ADVISED HIM THAT HE WOULD NOT BE IN VIOLATION OF THE CONFLICT OF INTEREST LAWS BASED ON THE DUTIES AS HE DESCRIBED THEM IN DD FORM 1357 DATED MAY 16, 1964.

THE OFFICE OF SPECIAL INVESTIGATIONS, OSI DISTRICT 9, BARKSDALE AIR FORCE BASE, HOWEVER, FURNISHED YOU A COPY OF THEIR LETTER OF SEPTEMBER 29, 1964, TO THE DIRECTOR, OFFICE OF SPECIAL INVESTIGATIONS (AFISIJ), WITH LETTER OF SEPTEMBER 8, 1964, FROM COLONEL SAHL TO MR. HERBERT BRADSHAW, ASSISTANT COMMISSARY OFFICER, BARKSDALE AIR FORCE BASE. YOU SAY THIS CORRESPONDENCE INDICATED COLONEL SAHL MIGHT BE ENGAGED IN SELLING WITHIN THE MEANING OF 37 U.S.C. 801 (C). WHEN YOU INFORMED HIM OF THIS IN LETTER OF MAY 21, 1965, COLONEL SAHL STATED IN A LETTER OF JULY 6, 1965, THAT THERE WAS NO FORMAL JOB DESCRIPTION FOR HIS POSITION IN THE COMPANY BUT HE DID STATE WHAT HIS DUTIES ENTAILED.

WITH THE EXCEPTION OF FIVE VISITS TO THE ARMY AND AIR FORCE EXCHANGE SERVICE AND ONE TO THE NAVY SHIP'S STORE OFFICE IN NEW YORK CITY FOR THE PURPOSE OF HAVING MONETTE COMPANY MANUFACTURING PRINCIPALS LISTED IN THE "PRICE AGREEMENT BULLETIN," AND SOME PERSONAL LETTERS TO FRIENDS ADVISING THEM OF HIS EMPLOYMENT, COLONEL SAHL'S DUTIES AS HE DESCRIBED THEM INVOLVED NO PROBABLE SALES CONTACTS WITH MILITARY DEPARTMENTS OR AGENCIES. IN THIS REGARD HE STATED SPECIFICALLY THAT HE HAD NOT SIGNED A BID, PROPOSAL OR CONTRACT; NEGOTIATED A CONTRACT; OR CONTACTED AN OFFICER OR EMPLOYEE OF ANY OF THE MILITARY DEPARTMENTS OR AGENCIES WITH RESPECT TO ANY PROSCRIBED CONTRACTING ACTIVITY AND HAD CONDUCTED NO LIAISON ACTIVITY THAT WAS INTENDED TO ULTIMATELY RESULT IN A SALE. COLONEL SAHL'S STATEMENTS WERE CONFIRMED BY THE PRESIDENT OF THE MONETTE COMPANY.

THE OFFICE OF SPECIAL INVESTIGATIONS INVESTIGATED COLONEL SAHL'S ACTIVITIES IN BEHALF OF THE MONETTE COMPANY AS REPORTED BY HIM. THE RESULTS OF THAT INVESTIGATION ARE SUMMARIZED IN YOUR LETTER AS FOLLOWS:

COLONEL SAHL, WHO WAS FORMERLY ASSIGNED AS STAFF COMMISSARY OFFICER, SECOND AIR FORCE, BARKSDALE AIR FORCE BASE, LOUISIANA, PRIOR TO HIS RETIREMENT HAD GAINED HIS PRESENT POSITION AS EXECUTIVE ASSISTANT AND MARKETING DIRECTOR FOR V.H. MONETTE AND COMPANY, (MANUFACTURER'S REPRESENTATIVE TO U.S. ARMED FORCES) SMITHFIELD, VIRGINIA. MR. BRADSHAW, ASSISTANT COMMISSARY OFFICER, BARKSDALE AFB, RELATED THAT COLONEL SAHL, A MONTH OR SO BEFORE HE RETIRED, TOLD HIM HE HAD A JOB LINED UP WITH V.H. MONETTE AND COMPANY; ALSO THAT COLONEL SAHL WENT TO WORK FOR THIS COMPANY IMMEDIATELY UPON HIS RETIREMENT FROM THE U.S. AIR FORCE. MR. BRADSHAW FURTHER STATED THAT EVEN THOUGH COLONEL SAHL, BECAUSE OF HIS PREVIOUS POSITION AS STAFF COMMISSARY OFFICER, WAS IN A POSITION TO INFLUENCE PURCHASES MADE FROM THE MONETTE COMPANY, HE (BRADSHAW) KNEW OF NO INSTANCES WHERE ANY ATTEMPT HAD BEEN MADE TO EXERCISE THAT INFLUENCE.

MR. BRADSHAW SERVED AS ASSISTANT COMMISSARY OFFICER AT BARKSDALE AFB FROM 2 FEBRUARY 1962 TO 18 AUGUST 1965. WITH THE EXCEPTION OF A TWO MONTH PERIOD WHEN HE WAS ACTING COMMISSARY OFFICER, HIS DUTIES DURING THIS TIME DID NOT INCLUDE BUYING FROM VENDORS. ALL PURCHASING DURING THIS PERIOD OF EMPLOYMENT WAS DONE BY THE COMMISSARY OFFICER. AFTER COLONEL SAHL'S RETIREMENT, MR. BRADSHAW HAD NO CONTACT WITH HIM OTHER THAN THE LETTER OF 8 SEPTEMBER 1964.

THE 6 JULY 1965 LETTER TO AFAFC WHICH DESCRIBES HIS DUTIES WITH V.H.MONETTE AND COMPANY, AS REQUIRING VISITS TO ARMY AND AIR FORCE EXCHANGE HEADQUARTERS AND U.S. NAVY SHIP'S STORE OFFICE. THIS LETTER INDICATES FIVE VISITS TO HQ AAFES AND ONE TO THE U.S. NAVY SHIP'S STORE OFFICE.

INTERVIEWS WITH APPROPRIATE ARMY, NAVY, AND MARINE EMPLOYEES OF EXCHANGES AND COMMISSARIES FAILED TO DISCLOSE SPECIFIC INFORMATION ASSOCIATING COLONEL SAHL WITH ACTUAL SELLING ACTIVITIES WHILE IN THE EMPLOY OF V.H. MONETTE AND COMPANY. MR. W. W. DOWNING, ASSISTANT COMMISSARY OFFICER, FORT MONROE, STATED HE HAD RECORDED COLONEL SAHL'S NAME AS BEING CONNECTED WITH MONETTE, HOWEVER, HE WAS NOT POSITIVE IN WHAT CAPACITY COLONEL SAHL MAY HAVE CONTACTED HIM. A TOTAL OF 25 PERSONS WERE INTERVIEWED IN THIS INVESTIGATION.

THE VISITS BY LT. COLONEL SAHL ON TWO OCCASIONS WITH COLONEL GILBERT F. RAHN, DIRECTOR OF PROCUREMENT FOR AAFES. DIRECTOR'S OPINION WAS THAT THESE WERE "PURELY PROTOCOL TYPE VISITS; " THAT LT. COLONEL SAHL "WOULD HAVE DEALT DIRECTLY WITH ARMY AND AIR FORCE EXCHANGE BUYERS RATHER THAN DIRECTOR OF PROCUREMENT.' IT WAS NOT SPECIFICALLY STATED WHETHER THIS WAS ONE OF THE VISITS REFERRED TO IN THE 6 JULY 1965 LETTER.

THE VISIT BY LT. COLONEL SAHL WITH DIRECTOR OF AUDIT AND INSPECTION FOR AAFES, LT. COLONEL AUGUST D. CORSALINI. LT. COLONEL SAHL SAID THESE WERE MERELY VISITS OF A SOCIAL NATURE WITH A FORMER MILITARY ASSOCIATE. THE DIRECTOR VERIFIED THEY HAD BEEN PERSONAL FRIENDS FOR MORE THAN 20 YEARS AND ALSO REFERRED TO VISIT AS "PERSONAL VISIT; " THAT LT. COLONEL SAHL HAD NOT CALLED ON HIM WITH THE VIEW OF OBTAINING BUSINESS FOR MONETTE AND COMPANY. AGAIN, IT IS NOT SPECIFICALLY STATED WHETHER THESE WERE VISITS REFERRED TO IN THE 6 JULY 1965 LETTER.

THE VISIT BY LT. COLONEL SAHL WITH MR. ROBERT COTTON, CIVILIAN EMPLOYEE OF AAFES. THIS WAS DESCRIBED AS A SOCIAL VISIT TO A PRIOR ACQUAINTANCE. MR. COTTON CONFIRMED THEIR PRIOR ACQUAINTANCESHIP. THERE IS A QUESTION AS TO WHETHER THIS VISIT WAS BEFORE OR AFTER LT. COLONEL SAHL'S EMPLOYMENT WITH V.H. MONETTE AND COMPANY. LT. COLONEL SAHL'S STATEMENT INDICATES THAT IT WAS AFTER; MR. COTTON'S STATEMENT INDICATES THAT IT WAS BEFORE LT. COLONEL SAHL BEGAN EMPLOYMENT WITH V.H. MONETTE AND COMPANY. IT IS NOT SPECIFICALLY STATED THAT THIS WAS ONE OF THE VISITS REFERRED TO IN THE 6 JULY 1965 LETTER.

THE VISIT BY LT. COLONEL SAHL TO NAVY SHIP STORE, NEW YORK CITY. LT. COLONEL SAHL STATED THAT HE MADE ONE SUCH VISIT MERELY TO ACCOMPANY ANOTHER SALES REPRESENTATIVE WHO DID NOT KNOW THE LOCATION OF THE OFFICE. IT IS NOT SPECIFICALLY STATED WHETHER THIS WAS THE VISIT REFERRED TO IN THE 6 JULY 1965 LETTER.

THE VISIT BY LT. COLONEL SAHL WITH MASTER SERGEANT MARK DURON, STORE MANAGER, OF LANGLEY AFB COMMISSARY. SERGEANT MARK DURON'S STATEMENT INDICATES THAT THE VISIT WAS OF A SOCIAL NATURE WHILE LT. COLONEL SAHL WAS ON A GROCERY SHOPPING TRIP WITH HIS WIFE AT THE LANGLEY AFB COMMISSARY, AND THAT THEIR CONVERSATION WAS BRIEFLY ABOUT THEIR RESPECTIVE FAMILIES; HOWEVER, THAT DURING THE CONVERSATION, LT. COLONEL SAHL INDICATED HE WAS A SALESMAN FOR THE MONETTE COMPANY. SERGEANT DURON'S STATEMENT FURTHER STATES THAT LT. COLONEL SAHL MADE NO REQUEST THAT HE SHOW ANY FAVORITISM FOR THE MONETTE COMPANY PRODUCTS, NOR DID LT. COLONEL SAHL ATTEMPT TO SOLICIT ANY PURCHASES. SERGEANT DURON'S STATEMENT INDICATES HE WAS NOT IN A POSITION TO INFLUENCE PURCHASES AND MADE NO PURCHASES FOR THE COMMISSARY. SERGEANT DURON ALSO STATED THAT THE MONETTE COMPANY WAS REPRESENTED BY SOMEONE OTHER THAN LT. COLONEL SAHL. THE STATEMENT BY LT. COLONEL SAHL INDICATES THAT WHILE EMPLOYED BY THE MONETTE COMPANY HE WENT GROCERY SHOPPING ON SEVERAL OCCASIONS AT THE LANGLEY AFB COMMISSARY AND WHILE SHOPPING HE VISITED WITH SERGEANT DURON. LT. COLONEL SAHL ALSO STATED HE NEVER ENGAGED FOR HIMSELF OR OTHERS IN SELLING OR CONTRACTING OR NEGOTIATING TO SELL SUPPLIES AT THE LANGLEY AFB COMMISSARY.

YOU EXPRESS DOUBT AS TO WHETHER IN THE CIRCUMSTANCES OF HIS CASE COLONEL SAHL WAS ENGAGED IN SELLING WITHIN THE MEANING OF 37 U.S.C. 801 (C) AND THE DEFINITION OF "SELLING" APPEARING IN DOD DIRECTIVE 5500.7, MARCH 22, 1966, AND AFR 30-30, JUNE 28, 1966.

THE MENTIONED LETTER OF SEPTEMBER 8, 1964, FROM COLONEL SAHL TO MR. BRADSHAW, ASSISTANT COMMISSARY OFFICER AT BARKSDALE AIR FORCE BASE, STATES IN PART:

"JUST READ THE DAILY SALES REPORT OF JIM MAY AND NOTICE THAT YOU HAVE REJECTED THE NEW FREEZER BOXES AND THAT IT WILL BE 1 OCTOBER BEFORE THE STORE IS COMPLETED. WHAT THE DEVIL HAPPENED?

"JIM SAID YOU ARE ALSO INTERESTED IN OUR CHICKEN. YES, WE HAVE A REAL FINE LINE OF CHICKEN FROM A LOCAL SOURCE, IN YOUR CASE, INSOFAR AS THE PLANT IS ONLY A FEW MILES FROM BARKSDALE. WE HAVE A USDA GRADE -A- CHICKEN AND WHEN ANYBODY STARTS TALKING PRICE, ASK THEM IF THEIR CHICKEN IS USDA GRADE -A-.'

COLONEL SAHL ADVISED OUR OFFICE BY LETTER OF MARCH 29, 1969, THAT THE REFERENCE TO THE FREEZER BOXES IN HIS LETTER TO MR. BRADSHAW WAS IN CONNECTION WITH A RENOVATION PROJECT UNDERTAKEN AT THE COMMISSARY AT BARKSDALE AIR FORCE BASE WHILE HE WAS ON ACTIVE DUTY THERE; THAT THE MONETTE COMPANY DOES NOT SELL OR DEAL IN ANY EQUIPMENT; AND THAT HIS INTEREST IN THE FREEZER BOXES WAS ONLY PERSONAL AND ONE OF CURIOSITY. ALSO ADVISED OUR OFFICE THAT THE MATTER CONCERNING THE CHICKEN WAS IN REPLY TO QUESTIONS BY MR. BRADSHAW TO MR. MAY AS TO WHETHER THE MONETTE COMPANY HAD A CHICKEN LINE FROM A LOCAL SOURCE, IF IT WAS U.S.D.A. GRADE, IF THAT WAS IMPORTANT IN PRICING, AND THAT HE DID NOT GIVE MR. BRADSHAW THE NAME OF THE COMPANY, PRICES, MINIMUM ORDERS, ETC.

WITH REGARD TO THE VISITS TO THE EXCHANGE HEADQUARTERS AND THE NAVY SHIP'S STORE OFFICE IN NEW YORK COLONEL SAHL ALSO ADVISED OUR OFFICE IN THIS LETTER THAT THE PRICE AGREEMENT BULLETIN IS ISSUED BY THE EXCHANGES LISTING MANUFACTURERS AND THEIR DELIVERED PRICES TO THE INDIVIDUAL EXCHANGES OR, IN THE CASE OF OVERSEAS, TO THE PORTS, AND THAT IN EFFECT IT IS A CATALOGUE OF AUTHORIZED MERCHANDISE FOR THE INDIVIDUAL EXCHANGE OFFICERS AND BUYERS. THIS IS A MATTER ENTIRELY BETWEEN THE MANUFACTURERS AND THE EXCHANGES. HE SAID THAT HE OVERSTATED THE NUMBER OF THE VISITS TO THE EXCHANGE SERVICE FOR THE PURPOSE OF IMPRESSING HIS EMPLOYER BUT THAT ON ONE OCCASION HE DID ACT AS A GUIDE FOR ONE OF THE MANUFACTURERS REPRESENTED BY THE MONETTE COMPANY TO SHOW HIM WHERE THE NAVY SHIP'S STORE OFFICE WAS LOCATED SINCE IT IS DIFFICULT TO FIND FROM UPPER MANHATTAN. STATED THAT HE DID NOT ACCOMPANY THE MANUFACTURER IN THE BUILDING BUT THAT HE WENT TO THE NAVY SHIP'S STORE TO BUY WHITE SHIRTS WHILE THE PRINCIPAL CONDUCTED HIS BUSINESS IN THE BUILDING AND JOINED HIM LATER FOR THE RETURN TRIP TO MANHATTAN.

SECTION 801 (C) OF TITLE 37, U.S.C. PROVIDED DURING THE PERIOD INVOLVED:

"PAYMENT MAY NOT BE MADE FROM ANY APPROPRIATION, FOR A PERIOD OF TWO YEARS AFTER HIS NAME IS PLACE ON THAT LIST, TO AN OFFICER ON A RETIRED LIST OF THE REGULAR ARMY, THE REGULAR NAVY, THE REGULAR AIR FORCE, THE REGULAR MARINE CORPS, THE REGULAR COAST GUARD, THE COAST AND GEODETIC SURVEY, OR THE PUBLIC HEATH SERVICE, WHO IS ENGAGED FOR HIMSELF OR OTHERS IN SELLING, OR CONTRACTING OR NEGOTIATING TO SELL, SUPPLIES OR WAR MATERIALS TO AN AGENCY OF THE DEPARTMENT OF DEFENSE, THE COAST GUARD, THE COAST AND GEODETIC SURVEY, OR THE PUBLIC HEALTH SERVICE. * * * " SECTIONS 49 (A) (1) AND 68 (2) OF PUBLIC LAW 89-718 DATED NOVEMBER 2, 1966, SUBSTITUTED ,ENVIRONMENTAL SCIENCE SERVICES ADMINISTRATION" FOR "COAST AND GEODETIC SURVEY" AND "THREE YEARS" FOR "TWO YEARS" IN THIS LAW.

THE TERM "SELLING" AS USED IN THIS LAW IS DEFINED IN PARAGRAPH I.C.2 OF INCLOSURE 3-C, DEPARTMENT OF DEFENSE DIRECTIVE 5500.7 DATED MARCH 22, 1966 (WHICH SUPERSEDED THE SAME DIRECTIVE DATED MAY 17, 1963) TO MEAN:

"A. SIGNING A BID, PROPOSAL, OR CONTRACT;

"B. NEGOTIATING A CONTRACT;

"C. CONTACTING AN OFFICER OR EMPLOYEE OF ANY OF THE FOREGOING DEPARTMENTS OR AGENCIES FOR THE PURPOSE OF:

"/1) OBTAINING OR NEGOTIATING CONTRACTS,

"/2) NEGOTIATING OR DISCUSSING CHANGES IN SPECIFICATIONS, PRICE, COST ALLOWANCES, OR OTHER TERMS OF A CONTRACT, OR

"/3) SETTLING DISPUTES CONCERNING PERFORMANCE OF A CONTRACT, OR

"D. ANY OTHER LIAISON ACTIVITY WITH A VIEW TOWARD THE ULTIMATE CONSUMMATION OF A SALE ALTHOUGH THE ACTUAL CONTRACT THEREFOR IS SUBSEQUENTLY NEGOTIATED BY ANOTHER PERSON.'

THE ABOVE DEFINITION IS IN LINE WITH OUR DECISIONS AND THE DECISION OF THE COURT OF CLAIMS IN THE CASE OF SEASTROM V UNITED STATES, 147 CT. CL. 453 (1959). SEE 38 COMP. GEN. 470; 39 COMP. GEN. 366; 40 COMP. GEN. 511; 41 COMP. GEN. 642. IT HAS BEEN HELD THAT THE EMPLOYMENT OF RETIRED OFFICERS IN NONSALES EXECUTIVE AND ADMINISTRATIVE POSITIONS IS OUTSIDE OF THE PURVIEW OF THE STATUTE. SEE 41 COMP. GEN. 784; 41 COMP. GEN. 799; 42 COMP. GEN. 87.

WE SAID IN 41 COMP. GEN. 799 THAT IT SEEMS OBVIOUS THAT THE STATUTORY PROVISIONS DO NOT ENCOMPASS PURELY SOCIAL CONTACTS AND, ALSO, THAT A RETIRED OFFICER WHO DOES NO MORE THAN TO RESPOND TO REQUESTS FOR ASSISTANCE, INFORMATION OR ADVICE IS NOT TO BE VIEWED AS ENGAGED IN SALES ACTIVITIES FOR PURPOSES OF THE STATUTE, EVEN THOUGH SUCH REQUEST MAY BE A STEP TOWARD THE PROCUREMENT OF SOME SUPPLY OR MATERIAL. WE ALSO SAID THAT THE STATUTORY PROHIBITION IS DIRECTED TO AN ENGAGEMENT IN SALES ACTIVITIES BY THE RETIRED OFFICER, NOT TO REQUESTS FOR ADVICE OR ASSISTANCE OR TO PURCHASES BY A MILITARY DEPARTMENT AND WE DID NOT VIEW THE QUOTED PROVISIONS OF DEPARTMENT OF DEFENSE DIRECTIVE 5500.7 AS IMPOSING ANY PROHIBITION NOT CONTEMPLATED BY THE STATUTORY PROVISIONS ON WHICH THEY ARE BASED. THE STATEMENT OF EMPLOYMENT, DD FORM 1357, SUBMITTED BY COLONEL SAHL DESCRIBING HIS DUTIES WITH THE MONETTE COMPANY DOES NOT SHOW THAT THEY INCLUDED NEGOTIATING CONTRACTS AND SOLICITING BUSINESS AS DEFINED IN DEPARTMENT OF DEFENSE DIRECTIVE 5500.7. ALSO, HIS LETTER OF SEPTEMBER 8, 1964, TO THE ASSISTANT COMMISSARY OFFICER AT BARKSDALE AIR FORCE BASE IN REPLY TO QUESTIONS FROM THE LATTER CONCERNING THE PURCHASE OF CHICKENS IS NOT CONSIDERED AS SOLICITING BUSINESS. INSOFAR AS NOW APPEARS, OTHER THAN ACTING AS A GUIDE IN LOCATING THE NAVY EXCHANGE SERVICE IN NEW YORK CITY FOR ONE OF THE PRINCIPALS OF THE MONETTE COMPANY, HIS CONTACTS WITH MEMBERS OF THE MILITARY SERVICE APPEAR TO HAVE BEEN OF A PERSONAL NATURE INCIDENT TO FRIENDSHIPS ESTABLISHED DURING HIS YEARS ON ACTIVE DUTY.

ACCORDINGLY, ON THE PRESENT RECORD, IT IS OUR VIEW THAT DURING THE PERIOD OF HIS EMPLOYMENT BY THE MONETTE COMPANY COLONEL SAHL DID NOT ENGAGE IN SALES ACTIVITIES SUBJECTING HIM TO THE RETIRED PAY FORFEITURE PROVISIONS OF 37 U.S.C. 801 (C). IF OTHERWISE CORRECT, HE IS ENTITLED TO RETIRED PAY FOR THE PERIOD INVOLVED.