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John Chierichella

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John Chierichella is of counsel in the Governmental Practice in the firm's Washington, D.C. office.

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Note: The following post is adapted from the forthcoming 2016/2017 GSA Schedule Handbook, published by ThompsonWest, due out later this year.

Any way you look at it, 2016 will be an interesting year.  You may have heard there is an election on the horizon.  That’s right; in November 2016, U.S. voters will trudge down to their neighborhood elementary schools and community centers to pull the lever (or, far less climactically, tap a graphic on a screen) for their favorite candidate.  As we draft this preface in Washington, D.C. in June 2016, Hillary and Donald are neck in neck for the White House with more than half of all Americans saying they are dissatisfied with both candidates.  This dismal statistic, of course, is consistent with the growing numbers of Americans who say they are dissatisfied with the federal Government (and Congress) generally.Continue Reading What GSA Can Learn from the National Parks Service

Volume VI —Organizational Conflicts of Interest:  When the Whole Is Less Than the Sum of Its Parts

An organizational conflict of interest (“OCI”) arises when the performance of one contract undermines a contractor’s objectivity or creates an unfair competitive advantage with respect to another contract.  An agency cannot issue an award to a contractor that possesses an OCI unless that OCI has been avoided, mitigated, or waived.  Many government contracts include clauses that require contractors to avoid potential OCIs, to notify the Government of any OCIs that arise after award, and to work with the Government to mitigate any such OCIs.  Some contracts also avoid OCIs proactively by precluding the contractor from performing specific types of work.Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

Volume V—The Land Mines Strewn Throughout the Data Room

M&A transactions, like most transactions in life, involve a cost/benefit analysis.  Some cost/benefit analyses are relatively easy to perform.  For example, if I buy an energy efficient appliance, I can calculate the likely savings in energy costs over the useful life of the appliance (the benefit) and compare it with the acquisition cost of the appliance (the cost).  M&A transactions, of course, involve far more complex cost/benefit analyses.  But the key to any such analysis is the ability to identify and quantify the costs and benefits with some measure of confidence.  Every line of business has its own quirks and idiosyncrasies, and they need to be understood when evaluating the acquisition of a company that operates in that line.  More than most, the business of government contracting is replete with such quirks and idiosyncrasies, and they can have a dramatic effect on the “cost” side of the cost/benefit analysis.Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

Volume IV – Key Issues in Government Contracts Due Diligence

This posting is the fourth in our ten-part series on unique issues that arise in connection with mergers and acquisitions involving government contractors and subcontractors.  Parts 1 through 3 focused on the structure of the transaction and the implications of that structure on the transfer of pending contracts and proposals.  This posting, Part 4, introduces some of the most important issues that potential buyers should consider and address during the due diligence and negotiation process.  The posting is not intended to be a detailed “due diligence checklist,” but rather a high level overview of certain key factors that are likely to impact the “go/no go” decision and the buyer’s valuation of the target company.
Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

Volume III—What Happens to Pending Proposals?

Thus far in this ten-part series, we have discussed whether and how existing contracts with the Government can be transferred to the buyer or surviving entity when an acquisition, merger, or consolidation occurs. Today, we leave the world of existing contracts and turn to bids and proposals that are pending when the deal closes.  What happens to those as-yet-unaccepted offers?  Is there anything you can do to enhance the likelihood that the Government will be willing to accept such offers notwithstanding the organizational change?  And, if you are in second place when the award is made to a “reorganized” offeror, are there possible protest grounds lurking in the deal that you could assert to obtain the award?
Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

Volume II – Obtaining Consent to Assign a Government Contract

This posting is the second in a ten-part series on unique issues that arise in the acquisition and disposition of a company that performs government contracts or subcontracts.  Part 1 focused on the types of deal structures that are subject to the anti-assignment statutes, and therefore require Government consent.  We explained that consent is not required for stock purchases, is required for asset sales, and may be required for other types of transactions, including mergers.  This posting, Part 2, addresses the consent process, including the who, what, when, and how of obtaining a novation agreement.  It also includes practical tips, based on our experience, for navigating the novation process efficiently and successfully.
Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

FAR 52.222-50 prohibits “human trafficking.” To quote the current GEICO TV commercials, “Everybody knows that.” But do you know exactly what the FAR prohibits? The answer includes some obvious pernicious acts, but it also covers some related activities that might not necessarily jump immediately to mind. Remember, these prohibitions apply to all contractors – large and small, commercial and non-commercial, whether the contract was awarded via sealed bidding or negotiation – and to their employees and agents, and they must be flowed down to subcontractors. Moreover, there is an obligation to conduct “due diligence” and certify to subcontractor compliance with the prohibitions if the subcontract exceeds $500,000 and any portion is for non-COTS supplies acquired or for services performed outside the United States.
Continue Reading Human Trafficking Is Forbidden by Government Contracts. But What Is “Human Trafficking”?

Volume I – The Structure of the Deal and Government Consent

With today’s posting, we begin a ten-part series on unique issues that arise in connection with the acquisition or disposition of a company that performs government contracts or subcontracts. These issues obviously come into play when the target company fits the bill as an established “government contractor,” replete with all of the infrastructure, systems, and processes that one normally associates with that term.  They also come into play, however, in connection with companies that sell standard commercial items to the Government under the auspices of the General Services Administration’s schedule contracts and companies that operate at all tiers within the Government’s supply chain.  They apply whether such companies are selling specialized products manufactured  to Government specifications or commercial items adopted or adapted for use, ultimately, by the Government.
Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

Note: The following post is adapted from the forthcoming 2015/2016 GSA Schedule Handbook, published by ThompsonWest, due out later this year.

The last year has been a tough one for the GSA Multiple Award Schedules (“MAS”) program.  The Federal Acquisition Service (“FAS”) – the agency charged with administering the MAS program – has struggled to re-invent itself and its contracting vehicles in order to ensure they both stay relevant in an increasingly competitive federal marketplace.  The byproduct of this struggle has been mostly negative for Schedule vendors.
Continue Reading As GSA FAS Struggles to Reinvent Itself, Contractors Suffer