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

Software companies selling indirectly to the Federal Government finally received an answer to a question that has lingered for years – can a software company going to market through a reseller bring a direct claim under the Contract Disputes Act (“CDA”) against the Federal Government for violating a term of the software company’s End User License Agreement? Sadly, the answer is “no.”

Continue Reading Software Companies Beware: Board Holds Subcontractor Cannot Enforce EULA Directly Against Federal Government

The Federal Acquisition Streamlining Act’s bid protest bar precluded contractors from challenging the award of a task or delivery order, subject to several limited exceptions — i.e., if the task or delivery order increased the scope, period or maximum value of the underlying IDIQ contract. Recent amendments to the Act expanded GAO’s bid protest jurisdiction to include challenges to task or delivery order awards valued at over $10 million. These amendments also provided for enhanced competition procedures for task or delivery order awards valued in excess of $5 million, but did not vest GAO or the Court of Federal Claims with jurisdiction to entertain bid protests based on alleged violations of those procedures. Thus, contractors seeking redress for agency errors in connection with the award of task or delivery orders valued at under $10 million were for the most part "out of luck."
 

Continue Reading COFC Endorses CDA Claim For Breach Of “Fair Opportunity To Be Considered”

As the closing time for receipt of proposals approaches, controlled chaos starts to take over. For one reason or another, changes may be made to your Company’s proposal that prevent it from putting its best foot forward. You are certain that the proposal meets the Solicitation requirements, but you also believe that one section of the proposal could have been better developed. While you would have liked further to have revised the proposal, you were forced to make sacrifices due to time constraints. You nevertheless were hopeful that the shortcomings would be addressed during discussions and in your final proposal revision (FPR). After several hectic days of red team review, your Company’s proposal is submitted to the agency in the nick of time.
 

Continue Reading Not-So Meaningful Discussions: The Hidden Peril of a “Good” Proposal

I.  INTRODUCTION

Without a doubt, the False Claims Act ("FCA") has been dramatically changed in the last few months. As will be discussed in more detail herein, it certainly appears that the FCA has been retooled so that the playing field is now stacked in favor of the government and qui tam plaintiffs. There is also every indication that lenders who have federally insured mortgages, redevelopment funding, or other financial support from the government, are at risk of being sued for false claims unless they take certain precautions to educate and protect themselves.

In fact, it is a good idea for all companies who receive government funding (e.g., defense contractors, health care providers, academic institutions) to look closely at their internal compliance programs, and modify them to reflect the recent changes in the FCA. This article is intended to offer some specific suggestions, and also encourage companies to have their programs amended, and implemented by legal counsel who are receptive to flexible billing arrangements including flat fee schedules.
 

Continue Reading New FCA Rules Put Lenders and Brokers Directly in Their Gun Sights

In November 2002, the FAR Councils eliminated the so-called "paid cost" rule from the FAR, which had previously prevented federal prime contractors other than small businesses from recognizing incurred subcontractor costs for purposes of progress billing until "payment by cash, check, or other form of actual payment" had actually been made. See 67 Federal Register 70520 (Nov. 22, 2002). The Government form used to request progress payments, the Standard Form (SF) 1443, Request for Progress Payments, implemented the paid cost rule by requiring large contractors to identify "paid costs eligible under progress payments clause" (Line 9) and "incurred costs eligible under progress payments clause" (Line 10). See FAR 53.301-1443 (2008) (last updated in October 1982). Bizarrely, however, when the paid cost rule was eliminated in 2002, the SF 1443 was not updated to remove these two lines. Now — a mere six years and eight months since the elimination of the paid cost rule — the FAR Councils have finally issued a revised SF 1443, removing Lines 9 and 10 and thereby eliminating the last vestiges of the long-defunct rule. See 74 Federal Register 28430 (Jun. 15, 2009).
 

Continue Reading Working Like a Highway Road Crew — Government Finally Amends SF 1443 to Eliminate References to “Paid Cost Rule,” a Mere Seven Years After the Fact

On May 29, 2009, President Obama signed into law the Fraud Enforcement and Recovery Act of 2009 ("FERA").[1] FERA implements a number of sweeping changes to the False Claims Act ("FCA"), including a provision that expands significantly the circumstances under which a contractor may be held liable under the so called "reverse false claims" theory.
 

Continue Reading Render Unto Caesar What Is Caesar’s … Or Else: The Expansion of False Claims Act Liability to the Retention of Overpayments