It is not unusual for agency personnel to request extracontractual changes during performance of a contract, many of which may seem fairly innocuous at first glance. From changing the type of screw used in a machine, to altering the background colors displayed on computer screens, extracontractual changes requested by agency personnel can seem minor or inconsequential, and contractors often readily agree without immediately recognizing the potential adverse consequences or taking the necessary steps to adequately protect themselves. Continue Reading Small Changes During Contract Performance Can Take A Large Bite Out Of The Bottom Line
In an “update” that reads more like a teaser to a B Movie, the OMB on Friday advised that it will have more guidance on EO 14042 for us soon. What precipitated this official warning that more guidance would be forthcoming? Well, it seems that tomorrow (October 18, 2022) OMB expects the Southern District of Georgia to narrow the nationwide injunction prohibiting enforcement of EO 14042. This is the procedural step we’ve all been waiting for since the 11th Circuit issued its decision on August 26, 2022. In anticipation of the narrowed injunction, OMB announced it expects to release three new guidance documents in the near future:Continue Reading EO 14042 Update 17.0 – Preview of Updated OMB Guidance
With apologies to Jaws II, just when you thought it was safe, the U.S. Court of Appeals for the 11th Circuit has released a shark back into the EO 14042 waters.Continue Reading Just When You Thought It Was Safe To Go Back In The Water . . . The 11th Circuit Revives Executive Order 14042
On August 5, 2021, the U.S. Court of Appeals for the Second Circuit ruled that a French banker may seek dismissal of an indictment without having to physically appear in the United States. The decision limits the application of the “fugitive disentitlement” doctrine – which has long prevented foreign nationals from challenging criminal prosecutions without appearing in the United States to do so.
Continue Reading The Second Circuit Court of Appeals Finds That French Banker Need Not Travel to the United States to Seek Dismissal of Her Indictment
Ignore our prior prediction—the U.S. Court of Federal Claims definitely is NOT remanding the protest by Medline Industries, Inc. (“Medline Protest’) to the agencies for corrective action. In a surprisingly scathing opinion issued June 22, 2021 by Judge David A. Tapp, the court made one thing very clear—the Department of Veterans Affairs’ (“VA”) transfer of its Medical Surgical Prime Vendor (“MSPV 2.0”) requirements to the Defense Logistics Agency (“DLA”) is dead on arrival. After issuing a brief order on June 17 denying remand to the agencies for corrective action, the court detailed its reasoning in an opinion issued in a parallel protest filed by Owens & Minor Distribution, Inc. challenging (slightly) different aspects of the shifting MSPV 2.0 procurement (“O&M Protest”). The government had moved for remand in both protests, and because the Medline Protest and O&M Protest involved the same parties and many common operative facts, the court issued a single opinion denying remand in both—and telegraphing that the outlook for the government in both cases is grim. Piling on, the court took a few shots at the government for its litigation conduct and (more generally) its lack of acquisition planning.
Continue Reading Duck Hunt – The VA Cannot Escape The Medline Protest, And Takes A Few Shots In The Process
2016 was a big year for the False Claims Act (FCA). Total government recoveries were up; total new matters filed were up; and total new government-led FCA matters were up. The Supreme Court issued multiple decisions relating to the FCA, including one—Universal Health Services, Inc. v. U.S. ex rel. Escobar, 136 S. Ct. 1989 (2016)—which will have dramatic ramifications for litigation relating to the FCA’s materiality standard. The Supreme Court also denied certiorari in an important FCA case—U.S. ex rel. Purcell v. MWI, Inc., 807 F.3d 281 (D.C. Cir. 2015), reh’g en banc denied, cert. denied, 580 U.S. ___ (2017)—in which the D.C. Circuit held that when a defendant adopts an objectively reasonable or plausible interpretation of an ambiguous regulatory term and the agency has not warned the defendant away from its interpretation via authoritative guidance, the FCA’s scienter element cannot be established. (Note: We previously covered the Purcell decision on our FCA blog. You can view our article, here.) Although some of these developments may seem concerning, there is plenty of silver lining here for government contractors.
Continue Reading What’s Past is Prologue: How The FCA’s Eventful Year in 2016 Will Affect Government Contractors
Contractors pursuing claims against the government under the Contract Disputes Act (“CDA”) can often fall victim to the jurisdictional pitfalls of the Act from the very start of the claims process, i.e., with the claim itself. After a contracting officer denies a claim under the CDA, a contractor can appeal the decision to either a Board of Contracts Appeals or the U.S. Court of Federal Claims. However, there is no shortage of cases in which such appeals are dismissed for lack of jurisdiction because the original requests for payment did not constitute “claims” under the CDA.Continue Reading Avoiding “Embarrassment” In Contract Disputes Act Litigation: Routine vs. Non-Routine Requests For Payment
By Alex Major
In March 2010, a federal district court in Texas ruled that the deaths and injuries sustained by a group of civilian convoy drivers in Iraq during insurgent attacks were not “accidents” caused by conditions of their employment and were, therefore, outside the scope of the protections afforded to contractors by the Defense Base Act (“DBA”). 42 U.S.C. § 1651, et seq. Fisher v. Halliburton, 703 F. Supp. 2d. 639 (S.D. Tex. 2010). We previously described and criticized the district court decision in this blog, noting that it was now unclear how, exactly, the DBA would fare in future litigation. But on January 12, 2012, the Fifth Circuit restored clarity— and common sense—to the application of the DBA by recognizing that the facts in Fisher presented “the quintessential case of a compensable injury arising from a third party’s assault”. Holding the DBA to be the exclusive remedy for damages, the Fifth Circuit vacated the district court’s decision and remanded the case for further proceedings. Fisher v. Halliburton, 2012 WL 90136 (5th Cir. 2012).Continue Reading Fisher v. Halliburton: Fifth Circuit Invokes Common Sense To Defend Defense Base Act
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.
Continue Reading Federal Circuit Casts Cloud on Future Recovery of Settlement Costs in Non-Fraud-Related Cases
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.
Continue Reading When “Generosity” Becomes a Vice: Eighth Circuit Affirms Gratuities Conviction Based on Email Correspondence Between Contractor and Government Employee
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.Continue Reading GAO Establishes Rules Of Procedure For New Contract Appeals Board