Effective Immediately! – FAR Amended to Include Prohibition on Chinese Telecommunications Equipment and Services in Government Contracts

In accordance with Section 889(a)(1)(A) of the 2019 National Defense Authorization Act (Pub. L. No. 115-232) (the “2019 NDAA”), which required imposition of broad restrictions on procurements involving certain Chinese telecommunications hardware manufacturers such as Huawei Technologies Co. and ZTE Corp within one year, the FAR Council has released an interim rule implementing these restrictions. Today, the FAR Council released Federal Acquisition Circular 2019-05 (84 Fed. Reg. 40,216), creating a new FAR Subpart 4.21, as well as two new contract clauses, FAR 52.204-24 and 52.204-25, all of which are effective August 13, 2019. These restrictions apply not only to prime contractors, but also to all subcontractors and throughout the supply chain. Government contractors need to know that these new requirements are effective immediately and that opportunities for waivers are very limited. Continue Reading

“Buy American” (Again): New Executive Order Requires Changes (By 2020)

On July 15, 2019, President Trump signed an Executive Order requiring regulations implementing the Buy American Act, 41 U.S.C. §§ 8301-8305, to be changed. While President Trump has previously issued two other policy-based “Buy American” Executive Orders, this new Order directs that specific changes be made, reversing government policies that have been in place for 65 years. These changes have the potential to significantly disrupt many government contractors’ supply chains and internal compliance programs. As such, companies should start planning now for the final regulations that are expected sometime in 2020. Continue Reading

New Bill Seeks to Bring Clarity to Insider Trading Law

On May 7, 2019, Representative James Himes (D-Conn) introduced the “Insider Trading Prohibition Act” (H.R. 2534). The proposed legislation would amend the Securities and Exchange Act of 1934, §§15 U.S. Code § 78a et seq. (the “Act”) by inserting a new section that defines the elements of criminal insider trading.

The bill’s objective is to eliminate the ambiguity of the offense as it is conceived under current law. It would also significantly expand the potential scope of criminal liability for insider trading in several ways: first, by eliminating the existing “personal benefit” requirement; second, by expanding the scienter requirement from willful to reckless use of “wrongfully obtained” material non-public information; and third, by expanding the definition of “wrongfully obtained” information to include stolen, hacked, and fraudulently obtained information. Continue Reading

A Lawyer’s Special Weapons and Tactics

A few years back, two of us had the privilege of joining a highly trained SWAT team in New Orleans responding to a call for a barricaded subject with an assault rifle. To be clear, by “joining” we mean observing from the relative safety of the command vehicle. From that vantage point, we had the privilege of watching the incident response unfold from start to finish through a wide-angle lens, so to speak. Like a SWAT team, a lawyer’s specialized knowledge and training arm us with a variety of tools to solve problems before resorting to the big guns (i.e., litigation). Read more about our lessons learned from SWAT here , to give us all more access to more tools.

 

OH SNAP! Supreme Court Rejects Substantial Competitive Harm Test For Key FOIA Exemption

On June 24, 2019, the Supreme Court ruled that Exemption 4 of the Freedom of Information Act (“FOIA”), which protects from public disclosure “trade secrets and commercial or financial information obtained from a person [that is] privileged or confidential,” does not require a showing of substantial competitive harm for information to qualify as “confidential.” The Court’s ruling represents a sea-change in how the Government must protect information under this important exemption. Continue Reading

Cyber Update: DoD Contractor Cybersecurity Certification and 33 New Enhanced Controls to Combat the Advanced Persistent Threat

The Government remains intensely focused on how best to protect its Controlled Unclassified Information (CUI) once it is released to contractors. In a shift from its initial approach of “we will take the contractor’s word for it,” the Department of Defense (DoD) announced in June 2019 it is in the process of developing a new cybersecurity certification program for its contractors, which will involve using third party auditors to validate contractor compliance with required security controls. In addition, on June 19, 2019, the National Institute of Standards and Technology (NIST) released two new highly-anticipated draft special publications – NIST SP 800-171, Rev 2 and NIST SP 800-171B – with a tight turnaround time for comments by July 19, 2019. Continue Reading

VA Begins Seeking MSPV 2.0 Partners

The Department of Veterans Affairs (“VA”), Veterans Health Administration (“VHA”) has begun the move toward its new Medical/Surgical Prime Vendor (“MSPV”) 2.0 program by issuing the formal RFP seeking prime vendors for distribution and supply management services on June 3, 2019. The MSPV 2.0 program will replace the current MSPV-Next Generation program, and is designed to deliver medical, surgical, dental, and laboratory supplies to VA medical centers using a just-in-time model. Under MSPV 2.0, several prime vendors will manage distribution of some 49,000 different supplies, which they acquire from manufacturers and other suppliers, to all VA medical centers around the United States and U.S. territories. MSPV 2.0 involves three interrelated sets of agreements: (1) prime vendor IDIQs with the VA, (2) VA BPAs with suppliers, and (3) prime vendor agreements with the suppliers. Continue Reading

CBCA Rules Contractor Under GWAC Task Orders Properly Submitted Claims to the Agency Ordering Contracting Officer Instead of the Procuring Contracting Officer

In a case of first impression, the Civilian Board of Contract Appeals (“CBCA”) ruled that a contractor performing task orders issued against a government-wide acquisition contract (“GWAC”) properly submitted its claims to the Agency Ordering Contracting Officer (“OCO”) instead of the Procuring Contracting Officer (“PCO”). The case – Sotera Defense Solutions, Inc. v. Department of Agriculture, CBCA 6029, 6030, 2019 WL 1977388 (Apr. 25, 2019) – involved two task orders issued by the Department of Agriculture (“USDA”) to Sotera Defense Solutions, Inc. (“Sotera”) for the provision of information technology (“IT”) support services at agency locations throughout the country. The USDA issued the task orders against a GWAC awarded by the National Institutes of Health (“NIH”). A GWAC, as explained by the CBCA in its decision, is defined by the Federal Acquisition Regulation (“FAR”) as a “task-order or delivery order contract for [IT] established by one agency for Governmentwide use.” Continue Reading

Veterans Are First at the VA Following New Class Deviation Implementing Recent Federal Circuit Mandate

In its most recent attempt to strike the appropriate balance between the Veterans First and AbilityOne programs, the U.S. Department of Veterans Affairs (“VA”) issued on May 20, 2019 a class deviation to the VA Acquisition Regulations (“VAAR,” 48 C.F.R. Chapter 8), instructing contracting officers to conduct a “Rule of Two” analysis before procuring from the AbilityOne Procurement List. Continue Reading

The Future of COTS Procurement: Top 10 Questions from GSA’s Section 846 Phase 2 Report

On May 2, 2019, the General Services Administration (“GSA”) and the Office of Management and Budget (“OMB”) finally released their Phase 2 Implementation Report (the “Phase 2 Report”) for “Procurement Through E-Commerce Portals,” as directed by Section 846 of the National Defense Authorization Act for Fiscal Year 2018 (“FY 2018 NDAA”).[1]

GSA/OMB offered a sneak preview of the Phase 2 Report at an Industry Day held on December 12, 2018, during which GSA/OMB revealed their intent to proceed with a proof of concept contract utilizing only the E-Marketplace model. Industry pushback against a single model proof of concept was both quick and severe and, coupled with the lengthy delay issuing the Phase 2 Report, many wondered whether GSA/OMB were reevaluating their proposed approach. Continue Reading

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