Government Contracts Lawyer & Attorney : Sheppard Mullin Law Firm : Bids, Licenses, Awards, Conflict of Interest.

The United States has long been the world's principal purchaser of (a) research and development services, (b) the products generated by the R&D, and (c) the intellectual property relating to that R&D.  Historically, Government-funded R&D has evoked images of an omnipresent, overly intrusive, audit-fixated purchaser bent on levying a host of required terms and conditions on the seller, many of which are wholly unrelated to the underlying R&D and are designed solely to advance socio-economic policies and preferences. For these (and other) reasons, companies, particularly new and emerging companies, are often reluctant to accept federal funding to advance their privately conceived and privately developed ideas.

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The hiring and use of former Government officials, while of obvious advantage in the ongoing conduct of business, can be fraught with short term peril, including criminal liability. The conviction of Darlene Druyun in connection with hiring irregularities and the ensuing legal difficulties of its employer should be enough to alert companies and individuals to the need for vigilance in this area. In this edition of the blog, we provide a primer on the rules that govern the hiring and use of former Government officials. The following PowerPoint delineates some of the more important restrictions related to hiring Government or former Government employees.

To view the PowerPoint, please click here.

Authored by:

Keith Szeliga

202. 218.0003

kszeliga@sheppardmullin.com

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1. Every audit has the potential for multiple layers of liability - contractual, civil and criminal.

2. Coordinate all audit activity - start to finish - with your Law Department.

3. Speak with one voice, literally - use a single point of contact for all audit communications with the Government.

4. Try to negotiate reasonable limits on the documentation to be made available.

5. Be fully responsive to the audit request - but do not produce what has not been requested.

6. Bring the records to the auditor, not the auditors to the records.

7. Keep records of everything produced.

8. Educate your employees about the audit process and how to interact with the auditors - see Rule No. 3 above.

9. Do not allow audits to devolve into depositions - see Rule No. 3 above.

10. Do not allow an erroneous draft audit report to go unchallenged - it will take on a life of its own.

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