Government Contracts Legal Round-Up | 2021 Issue 21

Welcome to Jenner & Block’s Government Contracts Legal Round‑Up, a biweekly update on important government contracts developments. This update offers brief summaries of key developments for government contracts legal, compliance, contracting, and business executives. Please contact any of the professionals at the bottom of the update for further information on any of these topics.

Executive Developments

1. White House Announces Extension of Contractor COVID-19 Vaccine Mandate to January 4, 2021 (November 4, 2021)

  • In a Fact Sheet dated November 4, the Biden Administration extended the deadline for federal contractors to comply with the COVID-19 vaccine mandate to January 4, 2021, matching the deadline of the vaccine mandates published by the Department of Labor’s Occupational Safety and Health Administration (for workers at private companies with more than 100 employees), and the Department of Health and Human Services (for health care workers at facilities participating in Medicare and Medicaid).
  • The Fact Sheet clarifies that the OSHA mandate, which allows testing in lieu of vaccination, is inapplicable to workplaces that are subject to the federal government contractor mandate.
  • The deadline extension comes amid legal challenges (which have temporarily blocked the OSHA mandate) and a variety of guidance, public meetings, and Q&A publications from the White House and the Safer Federal Workforce Task Force.
  • The Q&A Guidance clarifies, among other things, that affiliates may become covered contractor workplaces if covered contractor employees are present.

Regulatory Developments

1. Department of Defense Announces “CMMC 2.0” (November 4, 2021)

  • DoD announced that it is suspending the original CMMC piloting efforts and will not require CMMC in any contract prior to completion of a newly announced CMMC 2.0 rulemaking process. That process will last between nine and twenty-four months and will involve opportunities for public comment and stakeholder input.
  • CMMC 2.0 streamlines the original model from five levels to three: Level 1 with 17 practices; Level 2 with 110 practices that align with NIST SP 800-171; and Level 3 with 110+ practices based on NIST SP 800-172.
  • CMMC 2.0 reverts back to a self-assessment for Level 1 and some (but not all) Level 2 programs. It also imposes triannual third-party assessments for Level 2 programs with critical national security information, and triannual government-led assessments for Level 3. Programs requiring the most advanced cybersecurity standards and third-party assessments have yet to be identified. 
  • Plans of Action and Milestones (POA&Ms) for those unable to meet all criteria will be permitted in some cases.
  • During the interim period while the rulemaking is underway, DoD encourages contractors to continue to enhance their cybersecurity posture. Project Spectrum is a new tool to help companies assess their cyber readiness.

2. Federal Acquisition Regulation: Revision of Definition of Commercial Item, Final Rule (November 4, 2021)

  • DoD, GSA, and NASA have issued a final rule that redefines “commercial item” by replacing it with definitions of “commercial product” and “commercial service.”
  • The amendment to separate “commercial item” into “commercial product” and “commercial service” does not expand or shrink the scope of products or services that the Government may procure using FAR part 12, nor does it change the terms and conditions with which contractors must comply.

Protest Cases

1. Aero Spray, Inc. d/b/a Dauntless Air v. United States, COFC No. 21-1079C (October 28, 2021)

  • COFC dismissed a bid protest filed by a contract awardee because the awardee in this procurement lacked standing to protest.
  • The Department of the Interior awarded indefinite-delivery, indefinite-quantity (IDIQ) contracts to four companies, including Aero Spray, for aircraft services for wildfire firefighting.
  • Aero Spray lodged a protest on the basis that two of the awardees failed to comply with the solicitation’s aircraft configuration requirements. Aero Spray contended that it “spent significant funds” to comply with the requirement and that it would suffer economic harm from increased future competition for task orders resulting from the allegedly improper IDIQ contracts.
  • In finding that Aero Spray, as an awardee, lacked standing, the Court followed Federal Circuit precedent and turned to the Competition in Contracting Act’s definition of an “interested party,” i.e., “an actual or prospective bidder or offeror whose direct economic interest would be affected by the award of the contract or by failure to award the contract.”
  • Applying the CICA definition, the Court concluded that Aero Spray, “having received a contract award for all that it proposed, was not, and is not, an actual offeror ‘with respect to’ the other contract awards to which Aero Spray now objects.”

GAO has consistently rejected the notion that a contract awardee qualifies as an interested party to file a bid protest, but the COFC has reached different conclusions under similar facts. Here, however, the Court emphasized “the general rule [] that ‘[o]nce a party becomes an awardee, they are no longer an ‘interested party’ with standing to bring a bid protest claim under 28 U.S.C. § 1491(b).” More specifically, this case stands for the proposition that “where an offeror received the very contract it sought,” that the company cannot be considered an actual offeror (and thus an interested party) with respect to the other contract awards it did not seek. But an awardee still may establish interested party status (at the Court) where it claims it should have won different or additional contracts.

2. ICI Services Corp., B-418255.5; B-418255.6 (October 13, 2021) (Published October 28)

  • GAO denied a protest challenging that the Navy failed to properly evaluate Serco, Inc.’s eligibility for award as a corporate successor-in-interest to Alion Science and Technology Corporation, the entity that originally submitted a proposal.
  • The Navy issued the RFP to the Navy’s SeaPort Next Generation (SeaPort-NxG) IDIQ contract holders. Prior to its proposal submission, Alion entered into a definitive agreement with Serco, another SeaPort-NxG contract holder, whereby Serco would acquire, among other things, Alion’s Naval Systems Business Unit (NSBU).
  • In its initial proposal, Alion informed the Navy about the existence of the definitive agreement with Serco, advised that the corporate transaction was expected to close later in the year, and indicated that the “resources identified and included in this proposal will remain the same.” Specifically, within the NSBU, the Ship Systems Business Unit (SSBU) was the largest organization and “owned” the employees, facilities, and other resources that comprised Alion’s proposal, as well as the cost history and past performance included in Alion’s proposal.
  • The transaction was finalized after initial proposal submission, but prior to discussions. Because the Alion NSBU was now a part of Serco, the agency’s discussions were held with Serco. The Navy sought and received detailed information regarding the Serco-Alion transaction.
  • The contracting officer subsequently determined that: (1) Serco had acquired the entirety of the business entity that had submitted Alion’s proposal and which was proposed to perform; and (2) Serco’s purchase of Alion’s NSBU resulted in all relevant proposal assets—i.e., employees, leases/subleases, “any and all” other SSBU resources needed to perform the task order—being transferred from Alion to Serco. The Navy concluded that Serco could be substituted for Alion as an offeror under the RFP and, ultimately, awarded the task order to Serco.
  • The Protester alleged that Serco was not a complete successor-in-interest to Alion, as evidenced by the lack of a novation of Alion’s SeaPort-NxG contract, which rendered improper the selection of, and award to, Serco.
  • GAO denied the protest, first finding that there is no requirement that the entirety of Alion’s SeaPort-NxG contract be transferred, or novated, in order for Serco to be a complete successor-in-interest to Alion with respect to the entire portion of the business embraced by the Alion proposal.
  • GAO also found that ICI failed to establish that the Alion “corporate distinctions” which allegedly did not transfer to Serco were ones likely to have a significant cost or technical impact on performance of the task order.
  • Finally, GAO found it relevant that the Navy’s evaluation and award decision were not based on Alion’s initial proposal, but on Serco’s final proposal after the agency reasonably found Serco to be a proper successor-in-interest to Alion. GAO noted that there is no assertion that Serco’s performance of the task order would be in a manner materially different from that which Serco proposed in its final proposal, which is the ultimate nature of GAO’s concern regarding corporate transactions.

GAO’s case law regarding matters of corporate status and restructuring are highly fact-specific, and turn largely on the individual circumstances of the proposed transactions and timing. If you are the entity involved in a corporate transaction while in the midst of a procurement, take steps to provide the agency with the information necessary to determine you are eligible for award—which also insulates you in the case of a subsequent protest.

Claims Cases

1. Appeal of Tactical Network Corporation, ASBCA No. 62963 (October 13, 2021)

  • Tactical Network filed a dizzying number of motions as it sought to challenge the government’s interpretation of the contract and its concerns with pending deliverables. Specifically, Tactical Network sought an order directing the government to receive pending deliverables and filed a motion to compel seeking an order that the government refrain from taking further contract actions.
  • After the claim was appealed, the government terminated Tactical Network’s contract for default. Tactical Network then filed a “motion to join” seeking to convert the termination for default to a termination for convenience and consolidate the challenge with its existing appeal.
  • The Board denied Tactical Network’s motion to compel and similar requests in its complaint, reiterating that it does not possess jurisdiction to provide injunctive relief or order specific performance. The Board then interpreted Tactical Network’s motion to join as a notice of appeal of the termination and consolidated that appeal with the existing appeal.

Performance problems and threats of termination for default demand a serious and comprehensive response from the contractor. But it is important to understand and work within the limits of board jurisdiction in order to effectively resolve these significant issues.

Investigations and Enforcement

1. Deputy Attorney General Lisa Monaco announced several important changes to the Department of Justice’s corporate criminal enforcement policies and practices

On October 28, 2021, Deputy Attorney General (DAG) Lisa Monaco delivered a speech and issued a memorandum announcing several important changes to the Department of Justice (DOJ)’s corporate criminal enforcement policies and practices. These changes, which will apply to current and future corporate defendants, include:

  • Restoring prior DOJ guidance that in order to receive any cooperation credit in resolutions, companies must provide all non-privileged information regarding all individuals involved in the wrongdoing—not just individuals who were substantially involved;
  • Signaling an increased willingness to impose corporate compliance monitors on companies when resolving criminal investigations;
  • Considering a company’s entire history of misconduct—rather than only similar past misconduct—in deciding how to resolve a criminal investigation; and
  • Applying heightened scrutiny to companies’ adherence to deferred prosecution agreements (DPAs) and non-prosecution agreements (NPAs), as well as demonstrating increased willingness to declare companies in breach of those agreements when warranted.

Taken together, these revisions signal DOJ’s intent to pursue broader investigations and implement stricter enforcement measures than were the norm during the previous administration. DOJ plans to implement several structural changes to support these initiatives.

2. Senator Grassley Seeks False Claims Act Amendments

  • The Iowa Republican Senator, long a champion of the civil False Claims Act, continues his attempts to amend the FCA.
  • The current amendment would add “[i]n determining materiality, the decision of the Government to forego a refund or pay a claim despite actual knowledge of fraud or falsity shall not be considered dispositive if other reasons exist for the decision of the Government with respect to such refund or payment.”
  • This is the latest effort to blunt the impact of continued government payment on a FCA case’s materiality analysis. We will continue to watch these proposed amendments and issue further updates as needed.

Ask the Judge - by the Honorable Jeri Somers

After 18 years on the bench, I have some insight into how judges think about a vast variety of things. I will attempt to answer some of the questions that litigants frequently ask when trying to navigate the government contracts world.

Question: “How do judges react to discovery disputes? Do they enjoy them?”

Answer:

  • I personally considered discovery disputes a necessary evil, particularly when the discovery involves gnarly issues of privilege assertions. However, I found that if parties approach discovery disputes by providing the judge with clearly identified issues, with appropriate legal support for claims of privilege, the judge will be more willing to engage with the parties and rule on disputed issues. If you claim privileges in response to discovery disputes, you have an obligation to produce any information that is not considered privileged, and to provide a privilege log.
  • No one enjoys creating privilege logs. In fact, most lawyers spend little time thinking about how or why privilege logs should be created. While litigants frequently attempt to produce what they consider nonprivileged and to withhold from production whatever the party has identified as privileged, the rational assumption for the requesting party is that the other side is simply withholding discovery because it will either help the requesting party or harm its own case.
  • Nonetheless, FRCP 26(b)(5) requires a party to provide a list (the privilege log) of the information being withheld from a discovery production as privileged. Normally a privilege log will identify the basic information needed to describe the documents or electronically stored information withheld; and a clear statement of which privileges the responding party believes cover those documents. But, for whatever reason, the majority of parties neglect this obligation when claiming privilege. This leads the requesting party to file a motion to compel discovery, inevitably combined with a motion for sanctions. It is at those times that the judge may look unfavorably on the entire discovery dispute. How can a judge deal with these claims of privilege without the privilege log? It can be very frustrating.

Best Practice:

  • Anticipate the need to create the log by identifying those records that are responsive to discovery and then prepare for production, with the privileged records still in place. The privileged materials should then be removed, segregated, and loggedThis approach will enable the judge to make an informed ruling in this type of discovery dispute.

If you have any questions for me to address in future columns, please email me at jsomers@jenner.com. I look forward to hearing from you!


Government Contracts Legal Round-Up | 2021 Issue 20

Welcome to Jenner & Block’s Government Contracts Legal Round‑Up, a biweekly update on important government contracts developments. This update offers brief summaries of key developments for government contracts legal, compliance, contracting, and business executives. Please contact any of the professionals at the bottom of the update for further information on any of these topics.

Regulatory Developments

1. Implementation of Executive Order 14042, Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors, in Other Transaction Agreements (October 8, 2021)

  • On October 8, 2021, the Department of Defense issued a memo confirming that President Biden’s vaccine mandate extends to Other Transaction Agreements (OTAs).
  • For services agreements anticipated to exceed $250,000, agreements officers must insert a clause that requires contractors to comply with all guidance published by the Safer Federal Workforce Task Force in solicitations issued on or after October 15, 2021, as well as agreements issued on or after November 14, 2021 from solicitations issued before October 15, 2021.
  • Likewise, contractors should expect to see the clause in all options, extensions, or renewals exceeding $250,000 issued on or after October 15, 2021, and award of new work executed on or after November 14, 2021 within the existing ceiling and period of performance of an agreement irrespective of when the agreement was awarded.
  • Agreements officers have discretion to insert the clause in agreements awarded before November 14, 2021 resulting from solicitations issued before October 15, 2021; extensions of new work within the existing ceiling and period of performance valued at or below $250,000; and agreements for the manufacturing of products.
  • Bilateral modifications are required when modifying existing agreements. 

2. Guidance for Reporting the Use of Clause 252.223-7999, “Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors” (Class Deviation 2021-O0009) and Other Transactions Clause “Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors” to the Federal Procurement Data System (October 20, 2021)

  • Defense Pricing and Contracting (DPC) has directed contracting officers to track implementation of the vaccine mandate by entering the code “EO14042” when submitting contract action reports (CARs) in the Federal Procurement Data System (FPDS).
  • This new code will track implementation of the vaccine mandate in new and existing contracts and orders, for both FAR-based contracts and OTAs.
  • This tracking mechanism will allow the administration to assess whether agencies are acting on the administration’s strong encouragement to apply the vaccine mandate broadly.

3. Class Deviation 2022-O0001, Revision 1: Threshold for Obtaining Certified Cost or Pricing Data for Subcontracts and Price Adjustments (October 8, 2021)

  • Contracting officers have been directed to use $2 million, in lieu of $750,000 at FAR 15.403-4(a)(1), as the threshold for obtaining certified cost or pricing data for the award of a subcontract, at any tier, or a change or modification made to a prime contract or subcontract, at any tier.

Protest Cases

1. Academy Leadership, LLC, B-419705.2 (September 30, 2021) (published October 14, 2021)

  • GAO sustained a protest challenging the conduct of discussions in a United States Immigration and Customs Enforcement (ICE) FAR Part 13 simplified acquisition.
  • After receiving proposals, ICE sent Lincoln (the eventual awardee) an email stating “While evaluating your proposal, your pricing was significantly higher than the other proposals. Is this the best offer that you can provide?” In contrast, Academy received an email from ICE asking “Is the pricing that you submitted for the Gettysburg program the best offer that you can provide?” No other information was provided to Academy.
  • ICE selected Lincoln for award, finding that the benefits offered by Lincoln’s higher-rated proposal warranted the 53% price premium over Academy’s proposal.
  • The protester challenged that ICE’s discussions were unequal and not meaningful because Lincoln was notified of the area of its proposal that needed improvement (price), while Academy was not notified that ICE had concerns with its non-price proposal (nor given the opportunity to revise anything but price).
  • In response, the agency claimed these were requests for a price reduction, not discussions, and in any event were equal because both offerors were asked if their offer was “the best offer you can provide.”
  • GAO sustained the protest, first finding that the email to Lincoln included what would be considered as “ordinary indicia” of discussions by conveying information that was tailored to Lincoln’s proposal, bargaining, and providing the firm with an opportunity to revise its proposal.
  • Next, GAO concluded that the discussions were improper. While Academy’s initial proposed price was significantly lower than Lincoln’s price and the agency’s price estimate, the firm’s proposal had received a number of comments that lowered expectations of success under the non-price factors. GAO determined that these were effectively significant weaknesses and deficiencies, and therefore ICE was required to inform Academy of these issues during discussions. Simply asking for a price reduction did not suggest the agency’s true concerns, reflected in the technical flaws identified in Academy’s proposal, and so discussions were not meaningful.

In contrast to the deference afforded to agencies regarding evaluation findings, GAO will scrutinize the conduct of discussions to ensure they were equal, meaningful, and not misleading. In considering whether to protest on this basis, companies should carefully review any pre-award communications against information provided in the debriefing.


The Government Contracts Legal Round-Up | Episode 16

Associate Michelle Onibokun joins host David R. Robbins for a conversation about President Biden’s broad mandate for certain government contractors to be vaccinated against COVID-19 and the FAR class deviations to implement those requirements. Mr. Robbins and Ms. Onibokun also discussed the latest bid protest cases contractors should be aware of and the US Department of Justice’s Civil Cyber-Fraud initiative.


Government Contracts Legal Round-Up | 2021 Issue 19

Welcome to Jenner & Block’s Government Contracts Legal Round‑Up, a biweekly update on important government contracts developments. This update offers brief summaries of key developments for government contracts legal, compliance, contracting, and business executives. Please contact any of the professionals at the bottom of the update for further information on any of these topics.

Regulatory Developments

1. Class Deviation 2021-O0009: Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors (October 1, 2021)

  • DOD issued Class Deviation 2021-O0009 mandating the use of a DFARS provision, DFARS 252.223-7999
  • The DFARs clause contains substantively identical language to the FAR clause issued on September 30, 2021. In other words, the clause directs contractors to “comply with” the September 24 Task Force guidance, which we discuss here.
  • The clause includes a flowdown requirement: contractors must include the clause in services subcontracts that are above the SAT and are performed in the United States. 
  • The DOD deviation memorandum calls on COs to use a bilateral modification when modifying existing contracts, task orders, or delivery orders in accordance with the deviation.

2. Class Deviation 2021-03: From the Federal Acquisition Regulation Regarding Implementation of Executive Order 14042, Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors. (September 30, 2021)

  • The CAAC memorandum attaches a FAR deviation clause that mirrors the clause issued by the FAR Council on September 30, 2021. Accordingly, the clause directs contractors to “comply with” the September 24 Task Force guidance and to flow down the clause. 
  • The memorandum states that civilian agencies can adopt the FAR clause issued on September 30, 2021 without making any changes.
  • If an agency intends to use clause text different from that of the FAR clause, the agency must consult with the CAAC Chair.
  • The memorandum further adopts the encouragement of the FAR Council memorandum that agencies include the clause in: contracts that have been or will be awarded before November 14, 2021 (or solicitations issued before October 15, 2021); contracts below the SAT; and products manufacturing contracts and subcontracts.

3. FAR Case 2020-007: Accelerated Payments Applicable to Contracts with Certain Small Business Concerns, Proposed Rule (September 29, 2021)

  • The policy at FAR 32.009-1 has been expanded to address accelerated payments to small business contractors. 
  • A goal of payment within 15 days after receipt of a proper invoice is added, and prime contractors are prohibited from requesting any further consideration from the subcontractor in exchange for the accelerated payments.
  • These requirements will be incorporated into FAR clause 52.232-40, Providing Accelerated Payments to Small Business Subcontractors, which will be added to the list of clauses applicable to commercial items under FAR clause 52.215-5.

Protest Cases

1. Qwest Government Services, Inc. d/b/a CenturyLink QGS, B-420095 (October 6, 2021)

  • GAO dismissed a protest where the procuring entity was not a federal agency and therefore the procurement was outside of GAO’s jurisdiction.
  • Qwest protested the issuance of a task order by AgFirst-Farm Credit Bank off of a General Services Administration multiple-award contract.
  • Even though the solicitation contained language that cited the FAR’s bid protest provisions, GAO explained that AgFirst is borrower-owned financial institution—not a wholly owned government corporation as the protester contended—and therefore outside of GAO’s protest jurisdiction.

GAO’s bid protest jurisdiction is limited to procurements conducted by federal agencies. The Federal Property and Administrative Services Act of 1949 defines a federal agency as “an executive agency or an establishment in the legislative or judicial branch of the Government (except the Senate, the House of Representatives, and the Architect of the Capitol, and any activities under the direction of the Architect of the Capitol).” 40 U.S.C. § 102(5). GAO will dismiss a protest of a procurement conducted by an entity that does not fall under this definition.

2. Coast to Coast Computer Products, Inc., B-419833.2 (September 28, 2021)

  • GAO denied a protest challenging the Air Force’s use of a lowest-price, technically acceptable (LPTA) award methodology.
  • The DFARS lists eight criteria that must be satisfied before an entity of the Department of Defense can procure goods or services on an LPTA basis. DFARS 2.15.101-2-70. The DFARS also requires that DOD contracting officers “avoid, to the maximum extent practicable,” using LPTA procedures for procurements that are predominantly for the acquisition of certain items or services including, “[i]nformation technology services.”
  • Here, the contracting officer had prepared a determinations and findings memorandum (D&F) detailing how all of the DFARS criteria were satisfied.
  • Although the protester objected to numerous findings in the D&F, GAO found the protester’s objections constituted mere disagreement with the contracting officer’s findings, but did not establish that the D&F was unreasonable. GAO walked through several findings as illustrative examples.
  • GAO also held that the DFARS does not prohibit the use of LPTA award criteria for information technology products (as compared to services), which the Air Force was procuring under the solicitation.

A contracting agency has discretion to determine its needs and the best method to accommodate them, but the determination must still be reasonable. GAO will deny a protest challenging a DOD entity’s use of an LPTA award methodology if the agency’s explanations and determinations that the award criteria were authorized under DFARS are reasonable and can withstand logical scrutiny.

False Claims Act

The Department of Justice (DOJ) announced last week a new Civil Cyber-Fraud initiative which will use the False Claims Act (FCA) to enforce government contract cybersecurity requirements. The initiative will be led by the Fraud Section of the DOJ Civil Division’s Commercial Litigation Branch. DOJ believes it can bring its experience and resources from its civil fraud enforcement, procurement, and cybersecurity focused attorneys to make this a successful initiative.

In remarks coinciding with the launch of this initiative, Deputy Attorney General Lisa Monaco emphasized that DOJ will seek to impose “very hefty fines” on contractors or grant recipients who fail to comply with their obligations under cybersecurity standards. For example, while contractors are required to “rapidly report” (defined as reporting within 72 hours) “cyber incidents” to the Department of Defense under Defense Federal Acquisition Regulation Supplement 252.204-7012, Monaco suggested that contractors are falling short in meeting those reporting requirements. In particular, she stated that “[f]or too long, companies have chosen silence under the mistaken belief that it is less risky to hide a breach than to bring it forward and to report it. Well that changes today.”


Government Contracts Legal Round-Up | 2021 Issue 18

Welcome to Jenner & Block’s Government Contracts Legal Round‑Up, a biweekly update on important government contracts developments. This update offers brief summaries of key developments for government contracts legal, compliance, contracting, and business executives. Please contact any of the professionals at the bottom of the update for further information on any of these topics.

Executive Actions

1. The Safer Federal Workforce Task Force Vaccination Guidance (September 24, 2021)

  • This guidance implements President Biden’s Executive Order (EO) 14042: Ensuring Adequate COVID-19 Safety Protocols for Federal Contractors (full advisory on that EO here).
  • This highly anticipated guidance imposes broad requirements for covered contractor employees (and subcontractor employees) to be vaccinated by December 8, 2021, regardless of whether they work full-time or part-time, whether they work at a contractor workplace, federal workplace, or from their homes, and whether they work directly on a covered government contract, indirectly, or only at the same workplace as those who do. 
  • See Jenner & Block’s advisory for details regarding applicability and operation.
  • The Department of Defense has announced an early engagement opportunity for industry to comment, due no later than October 17, 2021.

Regulatory Developments

1. GSAR Case 2016-G511, Contract Requirements for GSA Information Systems, Proposed Rule Issued September 10, 2021, Comments Due by November 9, 2021

  • The GSA is proposing to amend the General Services Administration Acquisition Regulation (GSAR) to streamline and update requirements for contracts involving GSA information systems.
  • The proposed rule will replace outdated text with existing policies issued by GSA’s Chief Information Officer and provide centralized guidance to ensure consistent application across the organization. 
  • The updated GSA policy will align cybersecurity requirements based on items being procured by ensuring contract requirements are coordinated with GSA’s Chief Information Security Officer.
  • After finalization, this rule will require contracting officers to incorporate applicable cybersecurity requirements in statements of work to ensure compliance with federal guidelines and to prevent cyber incidents.

2. Notice of Rate Change for Minimum Wage Federal Contracts Covered by Executive Order 13658 (September 16, 2021)

  • The Wage and Hour Division of the Department of Labor issued this notice to announce the applicable minimum wage rate for workers performing work on or in connection with federal contracts covered by President Obama’s EO 13658. Beginning January 1, 2022, the rate paid workers on covered contracts will increase to $11.25 per hour, while the required minimum cash wage to tipped employees will increase to $7.90 per hour.
  • Covered contracts that are entered into on or after January 30, 2020, or that are renewed or extended on or after that date, will be generally subject to the higher $15.00 minimum wage rate established by President Biden’s EO 14026.

3. Extension of Time for Comments on FAR Buy American Act Requirements (September 23, 2021)

4. Request for Public Comments on Risks in the Semiconductor Supply Chain (September 24, 2021)

  • The Department of Commerce is seeking comments from those impacted by ongoing shortages in the semiconductor supply chain.
  • The goal is to accelerate information flow and reduce data gaps across the various supply chain participants, including domestic and foreign semiconductor design firms, semiconductor manufacturers, materials and equipment suppliers, as well as semiconductor intermediate and end-users.
  • Comments are due November 8, 2021.

Protest Cases

1. Marquis Solutions, LLC, B-419891; B-419891.2 (September 14, 2021) (Published September 21, 2021)

  • GAO sustained a protest where the agency had unreasonably and disparately evaluated the protester’s quotation, resulting in its quotation not receiving further consideration in the competition.
  • The Department of Veterans Affairs (VA) issued a solicitation for medical courier services in the New York metropolitan area under FAR Part 13 simplified acquisition procedures.
  • GAO observed that not only did the solicitation lack detailed instructions for preparation of technical quotations, the agency’s evaluation of the protester’s technical quotation was equally vague and took issue with the protester’s compliance with solicitation instructions.
  • GAO held that the agency had not adequately documented the basis for its evaluation and source selection decision. In particular, the evaluators failed to explain (or provide examples of) the details lacking in the protester’s quotation, instead levelling “vague and conclusory” critiques against the protester’s quotation.
  • GAO also found that the VA engaged in disparate treatment, including because the Agency found the protester’s quotation unacceptable for copying from the statement of work but overlooked the same concerns in the awardee’s proposal.

Even in competitions conducted under the simplified acquisition procedures under FAR Part 13 (meaning that the agency was not required to perform the in-depth evaluation required under FAR Part 15), agencies are still required to treat competitors fairly and equally and to sufficiently document the basis of its decisions.

Claims Cases

1. MLB Transportation Inc. v. VA, CBCA 7019 (September 3, 2021)

  • MLB Transportation, Inc. had a contract with the Department of Veterans Affairs to transport patients from a VA hospital to their homes. 
  • Although the parties treated the contract as if it was an IDIQ contract, the contract did not include any language indicating that it was an IDIQ contract. The parties both acknowledged that the contract was intended to be an IDIQ contract but that it lacked a guaranteed minimum clause (previous contracts between the parties did contain the clause).
  • As a result of the COVID-19 pandemic, the contractor could not recover its costs. MLB submitted a claim seeking reimbursement of the indirect additional costs.
  • On appeal, the board determined that the contract did not contain a minimum guarantee of the services to be ordered. The board noted that an IDIQ contract that lacks a guaranteed minimum is illusory and unenforceable, since the government had not made a binding promise regarding the minimum amount it will purchase. 
  • The board opined that although the contract was not enforceable at its inception, the VA’s obligations were limited to compensation for services provided, but nothing more.

Contractors should take care to not only read all contract provisions but also to note any provisions that are absent. Ask for clarification where the contract type is unclear or where something seems to be missing. Don’t assume that provisions from prior contracts will carry over. Remember that IDIQ contracts will not be enforced unless they contain a guaranteed minimum clause.

2. Anglin Consulting Group, Inc. v. Department of Homeland Security, CBCA 6926 (September 7, 2021)

  • The government entered into a contract with Anglin Consulting Group, Inc., for accounting and general clerk services. The firm fixed price contract had one base year and four one-year options. The government exercised two of the option years.
  • Through bilateral modifications to the contract, the parties agreed to remove the position of finance clerk, and remove two of the remaining three other positions from the contract.
  • Anglin submitted a request for equitable adjustment (REA), asserting that the descoping and deletion of work by these modifications caused it to absorb losses for costs incurred and caused loss profits. When the contracting officer denied the REA, stating that the underlying contract was a firm fixed price contract and the contractor had released all claims without reservation through the bilateral modification.
  • The contractor submitted a certified claim on the same grounds as the REA, but added that none of the modifications released its claims. The contracting officer denied the claim. Anglin appealed.
  • For the first time on appeal, Anglin argued that it only signed the modifications due to economic duress and that the government had breached its duty of good faith and fair dealing.
  • In response to the government’s predictable motion for dismiss for lack of jurisdiction on the grounds that those claims had not been presented to the contracting officer, Anglin filed an amended complaint, adding yet another new claim.
  • The Board dismissed the additional claims, finding that it did not have jurisdiction to hear claims that had not been presented to the contracting officer.

Ensuring that claims are presented at the right time and in the right way is essential and can be complicated. Legal advice from experienced government contracting attorneys can help contractors navigate this process.


Vaccination Required for Employees Working in Connection with Government Contracts or in Shared Facilities

By: Sati HarutyunyanMatthew L. HawsGabrielle SigelEmma J. Sullivan, and Joseph J. Torres

The Safer Federal Workforce Task Force (Task Force) issued its much anticipated guidance to federal contractors pursuant to President Biden’s Executive Order 14042 (EO), which we covered here. Simply put: the Task Force requires that covered contractor employees get vaccinated—whether they are full-time or part-time; whether they work at a contractor workplace, Federal workplace, or from their homes; and whether they work directly on a government contract, indirectly, or only at the same workplace as those who do. And this must be done by the holidays: the guidance requires prime contractors and subcontractors at any tier to ensure that all of these employees are fully vaccinated by December 8, 2021, unless they are legally entitled to an accommodation. (Thus, employees covered by the guidance must receive a single-dose vaccine or the second dose in a two-dose series by the Monday before Thanksgiving.) Here are some key takeaways from the guidance: 

What contracts and contractors are subject to this guidance? The vaccine EO requirements will be made applicable to contracts through a clause to be promulgated by the FAR Council by October 8 and incorporated into new contracts, extensions, and options exercised under existing contracts starting October 15, 2021. That clause, in turn, is expected to point to the Safer Federal Workforce Task Force guidance for its substantive requirements.
The Task Force guidance also “strongly encourages” agencies to incorporate the requirement into existing contracts and contracts entered into between the date of the EO and effective date itself, as well as contracts or subcontracts for the manufacturing of products.

What must covered contractors do to comply? Covered contractors must ensure that all employees are fully vaccinated against COVID-19, unless the employee is legally entitled to an accommodation no later than December 8, 2021. Covered contractors must also comply with CDC guidance related to masking and physical distancing, and must designate a coordinator for COVID workplace safety efforts. Specifically:

  • Covered contractors must require employees to show or provide a record of immunization, such as a COVID-19 vaccine card; a digital copy, including a photograph, is acceptable.
  • Covered contractors are not required to provide onsite vaccination for their employees and the guidance is silent on whether employees must be provided time off to receive their vaccine doses.
  • Covered contractors are “responsible for considering, and dispositioning” requests for accommodation. The guidance notes that contractors “may be required to provide an accommodation” because of a disability, sincerely held religious believe, practice, or observance.
  • Covered contractor employees must also comply with agency COVID-19 workplace safety requirements while in Federal workplaces.

Which employees must be vaccinated? The guidance requires vaccination for any full-time or part-time employee, who is not entitled to an accommodation, if they (1) perform work on or in connection with a covered contract, or (2) work at a location where those employees are, even if they themselves are not working on or in connection with a covered contract. This includes:

  • Employees working on or in connection with a covered contract from their homes;
  • Employees who do not work directly on the contract but “who perform duties necessary to the performance of the covered contract…such as human resources, billing, and legal review;” and
  • Employees not working in connection with a covered contract but working from the same location as those who do (or where they are “likely to be present”).

When is an employee considered fully vaccinated? Employees are considered fully vaccinated two weeks after they have received the second dose in a two-dose series, or two weeks after they have received a single-dose vaccine. There is no post-vaccination time limit on fully vaccinated status.

The breadth of the Task Force guidance will create significant questions for contractors as they seek to implement its requirements. Jenner & Block will be closely monitoring updates to the guidance issued by the Task Force and regulations issued by the FAR Council and OSHA, and other agency-specific actions. Our lawyers stand ready to assist our clients as they determine how to respond to the Administration’s latest requirements and guidance.


What is over the Horizon in Procurement Fraud, Claims and Appeals, and Bid Protests?

By: David B. RobbinsHon. Jeri K. Somers (Ret.), and Noah B. Bleicher

It can be challenging in the best of times for government contractors to “see over the horizon” and plan for future risks to their business. As this fiscal year ends, COVID-19 impacts, and budgetary changes make that exercise even harder. Jenner & Block’s former government officials have come together to offer their views to help our clients’ strategic planning and goal setting efforts. The observations are from former senior government contracts leaders, including a former Civilian Board of Contract Appeals Chief Judge, a former Government Accountability Office (GAO) senior bid protest official, and a former Air Force Deputy General Counsel (acting), Suspending and Debarring Official, and co-chair of the Department of Defense Procurement Fraud Working Group.

Procurement Fraud Trends with David Robbins

We are seeing a surge in False Claims Act and other procurement fraud investigations. Part of this is because the pandemic caused delays in investigations and that logjam is clearing now. Another part is the enhanced coordination among government procurement fraud investigators and enforcement officials created by the CARES Act and related oversight structure. The risk for contractors and awardees is at a high water mark. The risk extends beyond contractors to investors and private equity sponsors. We are also seeing more coordination between the US Department of Justice Civil and Criminal Divisions on investigations and prosecutions. Defending this requires cooperation among former prosecutors, former government agency lawyers, and others.

Claims and Appeals Trends with Hon. Jeri Somers (Ret.)

We see several major government contracting trends that initially gained significant prominence in 2020 continuing in 2021. First, President Biden’s “Executive Order on a Sustainable Public Health Supply Chain,” directs federal agencies to use the Defense Production Act to ramp up production and acquisition of anything and everything needed to combat the COVID-19 pandemic. Second, contractors should expect the Biden administration to continue to prioritize spending on US infrastructure. While contractors will benefit from the massive infusion of funding for infrastructure projects, such as the new emphasis on the development of clean energy technologies, we also see an increase in the traditional infrastructure projects in construction, transit, and telecommunication. cybersecurity and IT initiatives will also lead to more contracting opportunities. With this increased spending, we predict that we will see an increase in claims arising from such contracts.

Bid Protest Trends with Noah Bleicher

A contracting agency’s disparate treatment of competing offerors has historically been a popular basis for GAO to sustain a bid protest. But GAO’s recent adoption of the Federal Circuit’s “substantively indistinguishable” standard necessary to establish an unequal evaluation could make it more difficult for protesters to win these types of arguments. While GAO has represented publicly that the new standard does not reflect a material change in how it resolves these allegations, to date, GAO has sustained only three protests alleging disparate treatment and denied 20 under the standard, suggesting a harder path ahead for protesters. As GAO continues to issue decisions applying this standard, contractors will gain insight as to whether unequal treatment allegations remain a fruitful basis to winning a protest, or whether the pendulum truly has swung in the other direction.

Jenner & Block is equipped with some of the industry’s leading lawyers, including officials from three main government contract arenas. If you have any questions about these trends or are in need of counsel, you can reach out to David B. Robbins, Hon. Jeri Somers (Ret.), or Noah B. Bleicher.

Learn more about our Former Goverment Officials here.


Biden Administration Calls for Prompt Vaccination of Federal Employees and Government Contractors; No Testing Opt-Out Available.

By: Sati HarutyunyanDavid B. Robbins, Hon. Jeri K. Somers (Ret.), Gabrielle Sigel, Emma J. Sullivan, and Joseph J. Torres

On September 9, 2021, the Biden Administration announced additional measures to curb the ongoing spread of COVID-19. These measures include one executive order requiring all federal executive branch workers to be vaccinated and a second order extending this mandate to federal contractors.

The first order requires COVID-19 vaccination for all federal executive branch employees as defined in 5 U.S.C. § 2105. Under the order, executive agencies must implement programs requiring vaccination for all federal employees, with exceptions only as required by law. The order calls on The Safer Federal Workforce Task Force (Task Force) to issue guidance with respect to agency implementation of the program requirements within seven (7) days of the order’s issuance. During a September 9 press briefing, the White House Press Secretary stated that federal employees will have approximately 75 days to become fully vaccinated to avoid facing possible disciplinary action. The projected compliance date falls on November 23, 2021, the Tuesday before Thanksgiving.

The second order aims to ensure “that the parties that contract with the federal government provide adequate COVID-19 safeguards to their workers performing on or in connection with” federal contracts. Under this order, agencies must ensure that federal contracts and subcontracts incorporate a clause specifying that “the contractor or subcontractor shall, for the duration of the contract, comply with all guidance for contractor or subcontractor workplace locations published by the [Task Force],” if the guidance is approved by OMB after that agency determines that the Task Force’s guidance “will promote economy and efficiency in Federal contracting.” The contract clause “shall apply to any workplace locations … in which an individual is working on or in connection with a [federal] contract or contract-like instrument.” The order requires the Task Force to issue guidance applicable to federal contractors, including definitions, protocols, and exceptions, by September 24, 2021. Consistent with the Administration’s messaging, the Task Force guidance is expected to extend to federal contractors the same vaccination requirements imposed on federal employees. While the order is designed to apply broadly, excluded from its scope are federal contracts or “contract-like instruments” that are: 

  • grants; 
  • contracts with Indian Tribes; 
  • contracts at or below the simplified acquisition threshold; 
  • contracts where the employees perform work outside the United States or its outlying areas; and 
  • subcontracts solely for the provision of products.

These executive orders reach significantly beyond President Biden’s July 2021 requirements for federal workers and on-site contractors to become vaccinated, which had allowed an employee to opt out of vaccination by taking weekly or twice-weekly tests and practicing other workplace safety measures. (See the Task Force’s July 29, 2021 guidance.) Indeed, these orders are just two components of the Biden Administration’s rollout of a broader, six-pronged plan to combat the COVID-19 pandemic as the Delta variant continues to spread. The comprehensive plan includes, among other things, the issuance of an Emergency Temporary Standard by the Occupational Safety and Health Administration (OSHA) that will require all employers with 100 or more employees to ensure their workforce is fully vaccinated or require their unvaccinated workers to produce a negative test result on at least a weekly basis before coming to work.

Jenner & Block will be closely monitoring guidance issued by the Task Force and regulations issued by the FAR Council and OSHA, and other agency-specific actions. We will issue updated alerts as new information comes out. Our lawyers stand ready to assist our clients as they determine how to respond to the Administration’s latest requirements and guidance.


Government Contracts Legal Round-Up | 2021 Issue 17

Welcome to Jenner & Block’s Government Contracts Legal Round‑Up, a biweekly update on important government contracts developments. This update offers brief summaries of key developments for government contracts legal, compliance, contracting, and business executives. Please contact any of the professionals at the bottom of the update for further information on any of these topics.

Regulatory Activity

1. DFARS Case 2020-D030: Improved Energy Security for Main Operating Bases in Europe, Final Rule, Effective August 30, 2021

  • This final rule amends the DFARS to prohibit contracts for the acquisition of furnished energy for a covered military installation in Europe from inside the Russian Federation. The rule is intended to promote energy security and reduce reliance on Russia, though waivers may be sought. It applies only to contracts for furnished energy, but includes those at or below the simplified acquisition threshold and for the acquisition of commercial items, including COTS.

2. DFARS Case 2021-D019: Use of Firm-Fixed-Price Contracts for Foreign Military Sales, Final Rule, Effective August 30, 2021

  • This final rule rescinds the requirement for the use of firm-fixed-price contract types for foreign military sales unless an exception or waiver applies; DFARS 225.7301-1 is being removed and reserved.

3. DFARS Case 2021-D012: Contract Closeout Authority for DoD Services Contracts, Proposed Rule, Issued August 30, 2021; Comments due October 29, 2021

  • This proposed rule would amend the DFARS to enhance the ability to expedite contract close outs when certain conditions are met. At present, if a contract was entered into at least 17 years prior to the current fiscal year, is physically complete, and has been determined not reconcilable, the contracting officer may close the contract through a negotiated settlement.
  • This rule would reduce the number of years from 17 to 10 for military construction and shipbuilding, and to 7 years for all other contract actions. The rule would also require contracts to be physically complete at least four years prior to the current fiscal year.

4. DFARS Case 2019-D045: Maximizing the Use of American-Made Goods, Proposed Rule, Issued August 30, 2021; Comments due October 29, 2021

  • To align with previous changes to the FAR under President Trump’s Executive Order, this proposed rule would conform the definition of “domestic end product” and “domestic construction material” to differentiate between end products and material that consist wholly or predominantly of iron or steel or a combination of both, and those that do not.
  • In simple terms, end products and construction materials of iron/steel are domestic if manufactured in the US, and the cost of iron/steel not produced in the US or a qualifying country is less than 5 percent of the cost of all materials. Exceptions apply for construction fasteners.
  • If not of iron/steel, the domestic end products/construction materials must be manufactured in the US and the cost of qualifying country components and/or those mined, produced, or manufactured in the US must exceed 55 percent (an increase from 50 percent).
  • The price preference for domestic products remains at 50 percent for Department of Defense (DoD) contracts.
  • This proposed rule does not yet propose any changes stemming from President Biden’s more recent Executive Order enhancing Buy American Act requirements. Those changes have prompted a proposed FAR rule. Additional changes to the DFARS will likely follow finalization of that FAR proposed rule.

5. DFARS Case 2020-D008: Requiring Data Other Than Certified Cost or Pricing Data, Proposed Rule, Issued August 30, 2021; Comments due October 29, 2021

  • This proposed rule would prohibit contracting officers from basing the determination that the price of a contract or subcontract is fair and reasonable solely by reference to historic prices paid by the government.
  • Offerors who fail to comply with a reasonable request to submit data needed to determine price reasonableness are ineligible for award, unless the head of the contracting activity determines that it is in the best interest of the government to make the award. Despite being implemented in the FAR, this requirement must be separately adopted in the DFARS as the criteria for DoD contracts differ from those for civilian agencies.
  • This proposed rule adds the requirement that, unless exempted, a notation will be added in the Contractor Performance Assessment Reporting System (CPARS) that a contractor has denied multiple requests for submission of data other than certified cost or pricing date over the preceding three years.

6. Federal Acquisition Security Council Rule, Final Rule, Effective September 27, 2021

  • The Federal Acquisition Security Council (FASC) has issued a final rule to implement FASC operations, the sharing of supply chain risk information, and the exercise of the FASC’s authorities to recommend issuance of removal and exclusion order to address supply chain security risks.
  • Congress created the FASC in 2018 to improve executive branch coordination regarding the evaluation and sharing of threats and vulnerabilities in the acquisition of information and communications technology and services in the supply chain.
  • Although some changes were made as a result of public comments filed, the FASC rejected many suggested safeguards for companies who share information about potential security risks, and for companies accused of presenting a supply chain risk.

Protest Cases

1. Deloitte Consulting, LLP, B-418321.5; B-418321.6 (August 19, 2021) (Published September 2, 2021)

  • GAO sustained a protest ground where the awardee’s proposal failed to comply with the solicitation’s transition requirements and the agency failed to reasonably evaluate the awardee’s proposal against those requirements.
  • The Department of Health & Human Services issued a task order request for proposals for IT services.
  • The solicitation, through incorporated questions and answers, required that all offerors, including the incumbent contractor, price the six-month transition period for full performance of all PWS tasks.
  • The agency initially awarded the task order to Deloitte, but following two rounds of corrective action in response to earlier protests, the agency awarded the task order to Accenture Federal Services, the incumbent contractor.
  • Deloitte argued that the awardee failed to propose transition costs that included full performance of the PWS requirements, and GAO agreed, rejecting arguments that the solicitation requirement was ambiguous or unreasonable, or that the protest ground was untimely.
  • The protester demonstrated competitive prejudice because the awardee had only a slight technical advantage and had proposed a price that was less than one percent higher than the protester’s.
  • This protest demonstrates an instance where, in a close procurement, slight evaluation errors can tip the scales of prejudice in favor of a protester.

2. InfoPoint LLC, B-419856 (August 27, 2021)

  • GAO sustained a protest challenging an Air Force solicitation requirement that a joint venture, as opposed to the partners comprising the joint venture, possess a top-secret facility clearance.
  • The Air Force maintained that the requirement for the joint venture itself to have a facility clearance was based on guidance found in the Air Force National Industrial Security Program manual. The Air Force further argued that regulations issued by the DoD concerning security clearances should take precedence over any related regulations issued by the Small Business Administration (SBA) on this issue.
  • After seeking input from the SBA, GAO ultimately agreed with the SBA and the protester that the solicitation requirement was inconsistent with applicable law and regulation.
  • Specifically, the National Defense Authorization Act (NDAA) for Fiscal Year 2020 included a provision that a facility clearance “may not be required for a joint venture if that joint venture is composed entirely of entities that are currently cleared for access to such installation or facility.” Also, SBA regulations that implemented the NDAA provision and a related provision the Small Business Act require that only the “lead small business partner to the joint venture” possess the required facility security clearance.
  • In sustaining the protest, GAO rejected the Air Force’s various arguments, including the Air Force position that the NDAA provision was not yet effective pending regulatory implementation by DoD. GAO concluded that the provision was “an unambiguous command by Congress through a statute that DoD not require joint ventures to hold a facility clearance where the members of the joint venture hold the required facility clearances.”

Whether an unpopulated joint venture is required to meet certain security clearance requirements in a specific procurement has been an area of consternation and confusion. In this decision, GAO confirmed that DoD may not require a joint venture to hold a facility clearance where the joint venture members hold the required facility clearances.

3. Northrop Grumman Systems Corporation—Mission Systems, B-419560.3 et al. (August 18, 2021) (Published Sept. 3)

  • GAO sustained a protest because the Navy failed to reasonably consider the impact of an apparent conflict of interest stemming from the actions of a government employee who developed specifications for the solicitation at issue while at the same time engaging in employment negotiations with firm that ultimately received award.
  • The record showed that for several months in 2019, the Navy employee (referred to as X) was negotiating for employment with L3Harris while actively participating in the development of the Next Generation Jammer-Low Band Capability Block-1 specifications, and working closely with Northrop and L3Harris on the performance of their predecessor contracts.
  • GAO highlighted that applicable government ethics rules (identified under FAR 3.104-2) provide that a person should be disqualified from participating substantially in an acquisition while negotiating for employment with an offeror such as L3Harris.
  • The Navy maintained that X’s actions had no impact on the competition, but GAO rejected all of the agency’s defenses. GAO walked through the myriad ways X was involved with performance of the predecessor contracts and developing the specifications for the procurement at issue.
  • GAO noted in particular that prejudice is presumed where hard facts demonstrate a conflict of interest exists. In these instances, a protester is not required to establish bias in the solicitation or point to technical findings to establish a conflict of interest. Rather, “the hard facts that are required are those which establish the existence of the organizational conflict of interest, not the specific impact of that conflict,” according to GAO.
  • GAO ultimately concluded that X’s actions created the appearance of an unfair competitive advantage in favor of L3Harris and that the Navy’s consideration of the conflict was unreasonable. GAO recommended that the Navy conduct an independent review of the specifications and seek revised proposals from the two competitors.

Contracting agencies are to avoid even the appearance of impropriety in government procurements. Where an agency knowingly fails to investigate and resolve a question concerning whether an agency employee who actively and extensively engaged in procurement-related activities should have been recused from those activities, the existence of an actual or apparent a conflict of interest is sufficient to taint the procurement, and GAO will sustain a protest on this basis.

Claims Cases

1. Active Construction, Inc. v. Department of Transportation, CBCA 6597 (August 9, 2021)

  • Active Construction, Inc. (ACI) filed a motion to compel the Federal Highway Administration (FHWA) to produce documents to show that FHWA “surreptitiously blamed ACI for delays and changes to cover up the real cause: a lack of sufficient funding to support ACI’s contract.” FHWA refused, stating that the arguments in support of the motion to compel, i.e., that contract funding and bad faith issues, were not properly before the CBCA.
  • The CBCA held that it did not possess jurisdiction to entertain ACI’s implied duty breach claim arising from FHWA’s alleged lack of funding. The Board granted the motion to preclude ACI from raising the issue, finding the documents irrelevant to any issue properly before the CBCA.

This case provides guidance as to how the CBCA will construe and limit motions to compel. Contractors are only entitled to seek documents that relate to claims properly before the Board. The Board will not compel the government to provide documents that are unrelated to those claims.

FCA Amendments

Senator Grassley’s proposed “Anti-Fraud Amendments Act”, originally poised to pass with the upcoming infrastructure legislation, is no longer a part of the current version of the bill. The suggested changes would have required defendants to prove a lack of materiality by clear and convincing evidence, but for now at least, the burden of proof established by the Supreme Court’s 2016 decision in Universal Health Servs. v. U.S. ex rel. Escobar remains the law. That case declared the materiality standard as “demanding” and “rigorous” for the government to demonstrate.