The federal crop insurance program is an often overlooked area of potential liability under the False Claims Act (“FCA”). The program, which is governed by a substantial body of regulatory law, is subject to intense oversight by the U.S. Department of Justice. So much so that the U.S. Department of Agriculture’s Risk Management Agency maintains and keeps public a long list of DOJ prosecutions for fraud and violations of the False Claims Act. See DOJ Prosecutions. These prosecutions include criminal charges brought against North Carolina tobacco farmers, Texas peanut growers, and California fruit and vegetable producers for fraudulently filing claims against the USDA crop insurance program. Continue Reading
The upward trend of suspensions and debarments continued in FY 2014. According to the Interagency Suspension and Debarment Committee (“ISDC”) Report to Congress, released March 31, 2015, while referrals to the suspending and debarring officials decreased 12% from FY 2013, suspensions, debarments, and proposed debarments increased, Government-wide, by almost 8%. Since the ISDC began collecting data in 2009, these actions have continued to increase markedly. Continue Reading
It is a given that companies strive to protect their intellectual property. Over the years, as an instrument of that protection, companies have made increasing use of non-disclosure agreements to advance that objective. A recent decision of the Court of Federal Claims – Liberty Ammunition v. United States – calls into serious question the efficacy of NDAs signed by U.S. Government personnel. Continue Reading
Not enough Government contracts blogs incorporate movie trivia. So here’s my contribution to fill this obvious gap in the procurement blogosphere: Is the following quotation (a) from a famous Monty Python skit or (b) from a conversation between two Government auditors discussing GSA’s recently-proposed effort to do away with (at least in part) the Price Reductions Clause? Continue Reading
On February 12, 2015, the Department of Justice (“DOJ”) announced that three U.S.-based importers had agreed to pay more than $3 million to resolve a lawsuit brought by the United States under the False Claims Act (“FCA”). The Government alleged that the importers had made false declarations to U.S. Customs and Border Protection (“CBP”) and conspired with other domestic companies to make false declarations to CBP in order to avoid paying “antidumping” and “countervailing” duties. No Government contracts were involved. These were “reverse” FCA claims based upon underpayment of duties for private sector import transactions. Continue Reading
In late January, the FAR Council issued its long-awaited final rule amending the FAR to strengthen the U.S. Government’s policy against human trafficking. As discussed below, the amendments may have far-reaching compliance implications for government contractors. Continue Reading
The Federal False Claims Act (“FCA”), 31 U.S.C. § 3729, et seq., has unique procedural aspects that come into play when a private whistleblower (the “relator”) seeks to sue on behalf of the Government. One of these, the so-called “first-to-file” bar, applies when two “related” whistleblower actions are filed: “When a person brings an [FCA action], no person other than the Government may intervene or bring a related action based on the facts underlying the pending action.” 31 U.S.C. § 3730(b)(5). The circuits are split as to whether the bar applies only while the first-filed action is “pending,” or applies even if the first-filed action has been dismissed. For example, the Fourth Circuit held “that once a case is no longer pending the first-to-file bar does not stop a relator from filing a related case.” U.S. ex rel. Carter v. Kellogg Brown & Root Servs., Inc., 710 F.3d 171, 181, 183 (4th Cir. 2013), cert. granted, 134 S. Ct. 2899, 189 L. Ed. 2d 853 (2014). On the other hand, the D.C. Circuit expressly disagreed with Carter, rejecting the concept that the first-to-file bar is a “temporal limit” to related suits, and concluding that related actions are barred “regardless of the posture of the first-filed action.” U.S. ex rel. Shea v. Cellco P’ship, 748 F.3d 338, 343-44 (D.C. Cir. 2014), reh’g denied en banc (July 16, 2014). In finding that the statutory reference to “pending action” means the first-filed action, the D.C. Circuit noted that its interpretation “better suits” the policy of the bar—to prohibit subsequent private actions once the Government is on notice of the fraud. The Supreme Court’s July 1, 2014 grant of certiorari to review the Fourth Circuit’s decision in Carter should resolve the circuit split. Continue Reading
Under the “implied certification” theory of liability, a government contractor can violate the False Claims Act (“FCA”) by submitting a mere invoice for payment. The theory is that the invoice’s submission impliedly certifies compliance with contract conditions. If a contractor is not complying with material contract requirements and — despite the contractor’s noncompliance — submits an invoice for payment, then the Government or a relator might argue that the contractor has violated the FCA. Continue Reading
Two recent developments have the potential to change the landscape for contractors providing services to the Government. Government contractors and subcontractors are required to comply with a host of regulations governing their hiring practices and the wages they pay and benefits they provide to certain categories of employees. A recent Executive Order and court decision, however, have the potential to alter these requirements drastically.
On January 7, 2015, the U.S. Department of Defense (“DoD” or “the Department”) released an update for DoD Instruction 5000.02, on the “Operation of the Defense Acquisition Service.” The new Instruction is designed to assist acquisition personnel in tailoring the acquisition process to the specific item or system being purchased and to further the Department’s Better Buying Power initiative, launched in 2010. The Instruction focuses largely on the acquisition of DoD-specific software and weapons systems.