Federal Circuit Casts Cloud on Future Recovery of Settlement Costs in Non-Fraud-Related Cases

On May 19, 2009, the Federal Circuit in Secretary of the Army v. Tecom upheld the contracting officer’s disallowance of a contractor’s legal costs and settlement expenses in a sexual harassment and retaliation action brought under Title VII. The opinion is sweeping, and appears to extend the holding in Boeing North American, Inc. v. Roche, 298 F.3d 1272 (Fed. Cir. 2002) to almost every instance in which the contractor elects to settle in lieu of litigating cases to a conclusion.
 

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When "Generosity" Becomes a Vice: Eighth Circuit Affirms Gratuities Conviction Based on Email Correspondence Between Contractor and Government Employee

In United States v. Hoffman, 556 F.3d 871 (2009), the appellate court upheld a gratuities conviction based on an indictment alleging that the defendant had given a Government employee a set of golf clubs for or because of that Government employee’s role in rating the contractor’s performance under a contract with the United States Army Corps of Engineers. The court’s opinion illustrates a number of key points regarding the gratuities statute and the types of conduct that create the risk of a gratuities violation.
 

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GAO Establishes Rules Of Procedure For New Contract Appeals Board

GAO will soon issue final procedural rules for its newly-formed Contract Appeals Board, a body established by the Consolidated Appropriations Act of 2008 to hear appeals from decisions of contracting officers relating to contracts with an agency in the legislative branch.  On June 26, 2008, GAO published 25 pages of procedural rules as an interim agency rule subject to comment.  The comment period closed August 25.

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