Legislation directing the National Institute of Standards and technology (“NIST”) to create standards and guidelines for securing Internet of Things (“IoT”) devices used by Federal agencies and their contractors recently passed the Senate and is heading to the President’s desk. We have been following this legislation closely for the past two years, here and here.  The bill passed in the Senate without amendment by unanimous consent.
Continue Reading IoT Legislation Passes Congress

There is more than $2 trillion on the line and the multi-trillion-dollar question is: Who’s minding the store?  On March 27, 2020, in response to the financial set-back created by the novel COVID-19 pandemic, President Trump signed into law the more than $2 trillion Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) – by far the largest economic relief package in U.S. history.[1]  The CARES Act’s purpose is to keep the U.S. economy afloat and provide relief to struggling Americans, large corporate sectors, and small businesses while the nation battles this pandemic.  With $500 billion allocated for big corporations, $377 billion for small businesses, and another $153.5 billion for healthcare, these relief moneys (like with most government funds) are sure to come with strings attached in the form of complex regulations and substantial oversight, with enforcement not far behind.
Continue Reading The CARES Act – Who’s Minding the Store?

On March 18, 2020, the President signed into law the Families First Coronavirus Response Act, H.R. 6201, Pub. L. No. 116-127 (the “Coronavirus Response Act”). Among other measures in response to the current pandemic, this legislation offers manufacturers and distributors of industrial-grade face masks, referred to as “personal respiratory protective devices,” immunity from liability arising from use of the masks in connection with COVID-19. This immunity is retroactive to January 27, 2020, will last through October 1, 2024, and stems from the Federal Government’s effort to respond to the shortage of available masks. The law follows the Food & Drug Administration’s Emergency Use Authorization for emergency use of industrial-grade face masks in health care settings on March 2, 2020.
Continue Reading Families First Coronavirus Response Act: Face Mask Manufacturers and Distributors Protected from Liability for Coronavirus Deaths

On March 25, 2020 the Senate passed a $2 trillion stimulus bill “[p]roviding emergency assistance and healthcare response for individuals, families and businesses affected by the 2020 coronavirus pandemic.”  The House and the President are both expected to approve the Bill in short order.  The Bill contains many provisions important to all companies, including government contractors.  Sheppard Mullin’s Government Contracts, Investigations and International Trade Practice Group prepared a summary of the Bill, available here.  In addition, for your reference, we are providing a section-by-section analysis from Capitol Hill, as well as the text of the bill itself.  Do not hesitate to contact us with any questions about the legislation or its implementation.
Continue Reading Key Provisions in the Senate Stimulus Bill

In 2019, cybersecurity has become top-of-mind for most federal government contractors and agencies that share sensitive information.  In addition to updated Department of Defense guidance and procedures for evaluating contractors’ compliance with cybersecurity requirements, as well as an increase in Department of Defense cybersecurity audits, the Federal Acquisition Regulation (FAR) council also has promised a new FAR clause that will require compliance with NIST SP 800-171 security controls for civilian agency contractors that receive or create Controlled Unclassified Information (CUI).
Continue Reading “Internet of Things” Guidance to be Added to Cybersecurity Requirements for Agencies and Federal Contractors

After 35 days of the government shutdown, one of the (many) issues currently facing companies who contract with government agencies affected by the shutdown is if, when, and how, they must pay their employees upon the reopening of the government.
Continue Reading Recovering After the Shutdown: Proposed Legislation to Guarantee Back Pay for Government Contractors

The 2019 National Defense Authorization Act (“NDAA”) imposes new restrictions on procurements for telecommunications equipment or services based on ties to certain Chinese entities, thereby growing the list of forbidden products for contractors. Specifically, Section 889 prohibits executive-branch agencies from initiating procurements or entering into contracts for certain telecommunications equipment or services from companies associated with, owned, or controlled by the People’s Republic of China, that are to be used “as a substantial or essential component of any system, or as critical technology as part of any system.”
Continue Reading The List of Forbidden Products Grows: The NDAA’s Prohibitions on Use of Certain Chinese-Made Equipment

There is universal acknowledgement that anti-money laundering (“AML”) monitoring has become progressively costlier (both in terms of time and money) since the Bank Secrecy Act (“BSA”) was passed nearly five decades ago, and that compliance has become increasingly burdensome, especially for smaller regional and community institutions. According to the Financial Crimes Enforcement Network (“FinCEN”), nearly one million suspicious activity reports (“SAR”) were filed in 2016 (up from 669,000 in 2013). According to a 2016 report by the Heritage Foundation, the cost of compliance with current AML rules could be as much as $8 billion a year. Notwithstanding the tremendous resources spent on AML compliance, money laundering is still rampant. The U.N. has estimated that the amount of money laundered every year is between $800 billion and $2 trillion dollars. However, according to a 2011 report issued by the U.N. Office on Drugs and Crime, less than one percent of this amount is seized by law enforcement.
Continue Reading New Legislation Introduced in 2017 Signals the Beginning of a Strong Push for AML Reform

On July 2, 2015, the FAR Council issued a Final Rule that amends the FAR, effective October 1, 2015, to implement inflation-based adjustments to certain acquisition-related monetary thresholds. 80 Fed. Reg. 38293. The modifications will be made to comply with 41 U.S.C. § 1908, which requires the FAR Council to calculate the adjustments every five years based on the Consumer Price Index for all urban consumers. The statute does not require adjustments to thresholds established by the Construction Wage Rate Requirements statute (the Davis-Bacon Act), the Service Contract Labor Standards statute, or the United States Trade Representative, pursuant to Title III of the Trade Agreements Act of 1979.
Continue Reading Heads Up! Inflation Adjustments to Acquisition Thresholds Are Just Around the Corner

SBA Proposes to Increase Small Business Size Standards (79 Fed. Reg. 54145; 79 Fed. Reg. 53646)

The U.S. Small Business Administration (“SBA”) proposes to increase small business size standards for: (1) 209 industries in North American Industry Classification System (NAICS) in the manufacturing sector; and (2) industries with employee based size standards not part of manufacturing, wholesale trade, or retail trade.  These proposed rules are parts of a series of proposed rules that will review the size standards of industries.


Continue Reading What’s New Out There? Highlights from the Federal Register

DOD Proposed Rules Seeking Contractor Business System Rule Self Assessments

The Department of Defense issued a proposed rule on July 15th that would revise the DFARS Business Systems Rule by requiring contractors with estimating, accounting, material management, and accounting systems that are currently subject to the existing Business Systems Rule to perform self-assessment reports on their business systems compliance.  The proposed rule would have contractors assuming responsibility for annual self-assessments of those systems and for overseeing a triennial audit of the contractor’s compliance by an independent contractor-selected Certified Public Accountant.  As drafted, the proposed rule would only apply to the contractor’s accounting, estimating, material management, and accounting systems used for DOD CAS-covered contracts. Government auditors would examine the results of the self-evaluations.  Contractors will be offered no favorable credit or “safe harbor” for disclosures made in the contractor’s report.


Continue Reading Federal Register Round Up – June/July 2014