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By: David S. Gallacher

Just in time for the end-of-year push to fund the Government and to "create more jobs," members of Congress and President Obama had a rare moment of consensus when they unanimously(!) repealed an extremely unpopular withholding requirement that has been haunting recipients of federal funds since 2005. The "3% Withholding Repeal and Job Creation Act" was signed into law on November 21, 2011 (Pub. L. No. 112-56, Title I), eliminating a requirement to withhold 3% on most payments to contractors and grant recipients. While there are many in Government and industry alike who are ecstatic at the passage of the Act, the Ghost of Christmas Future warns that this specter of "withholding" may not have yet fled the scene. Like poor, chained Jacob Marley from Dickens’ A Christmas Carol, industry may yet find itself captive, bound, and double-ironed by future Congressional plots to confiscate funds from government contractors. Miserly grasping for every penny, one can almost hear the federal Government grumbling, "Bah! Humbug!"Continue Reading “Bah! Humbug!” – 3% Withholding and the Ghost of Christmas Future

By Marko W. Kipa

The saga began with the passage of the 2008 National Defense Authorization Act. While the Act contained a general prohibition barring bid protests of task and delivery order awards (excluding challenges to scope, period, or maximum value), it granted the GAO exclusive jurisdiction over bid protests of civilian and defense agency task and delivery order awards valued at over $10 million. The Act also included a sunset date – May 27, 2011. The reach of the Act’s sunset provision would prove to be critical in shaping the GAO’s and the Court of Federal Claims’ jurisdiction over bid protests of civilian agency task and delivery order awards.
 Continue Reading Task And Delivery Order Protests: Taking Aim At A Moving Target

By Marko W. Kipa

Many believed that the Government Accountability Office’s (“GAO’s”) jurisdiction over bid protests of civilian agency task and delivery order awards valued at over $10 million expired on May 27, 2011. This belief was based on the fact that certain broadened jurisdiction over civilian agency task and delivery order protests granted by the 2008 National Defense Authorization Act (“2008 Act”) expired on that date. With the expiration of the broadened jurisdictional grant found in the 2008 Act, many thus contended that a contractor would not be able to protest a civilian agency task or delivery order award at the GAO unless the protest alleged that the order exceeded the scope, period or maximum value of the underlying contract. Protests of Department of Defense task and delivery order awards valued at over $10 million were not similarly affected because Congress extended the GAO’s exclusive, broadened jurisdiction over these protests through the 2011 National Defense Authorization Act.
 Continue Reading The GAO Holds It Possesses Jurisdiction Over Bid Protests of Civilian Agency Task and Delivery Order Awards

By Marko W. Kipa

Over the past three years, government contractors have been able to pursue bid protests at the Government Accountability Office (the “GAO”) challenging awards of defense and civilian task and delivery orders valued at over $10 million. This expanded jurisdiction, however, is set to expire on May 27, 2011. Congress appeared to have addressed the issue in the National Defense Authorization Act for Fiscal Year 2011 (the “Act”) by including a provision extending the GAO’s expanded jurisdiction until September 30, 2016, but, for whatever reason, the Act captured only defense task and delivery order awards. This omission not only was strange, but it also seemed to run counter to the spirit of the original grant of task/delivery order jurisdiction. We analyzed the Act’s legislative history here and concluded that it did not provide a basis for only partially extending the GAO’s expanded jurisdiction. Shortly thereafter, the U.S. House of Representatives (the “House”) and the U.S. Senate (the “Senate”) introduced bills targeted at extending the GAO’s jurisdiction over civilian task and delivery order bid protests. See H.R. 899; see also S. 498.
 Continue Reading Making Amends: Countdown To May 27, 2011

By David S. Gallacher

Those familiar with Government contracting know at least a little bit about the elusive and fickle regulatory requirements for Independent Research and Development (“IR&D” or “IRAD”) costs. IR&D is a means by which the U.S. Government supports a Contractor’s independent R&D efforts. By reimbursing a Contractor’s independent R&D costs, the Government long has hoped to advance the state of the art without stifling a contractor’s innovation under the weight of a federal bureaucracy, while simultaneously banking on the fact that the U.S. Government also will benefit from the technology advancements. But two recent developments may change the essential nature of IR&D, making it less “independent” and more “dependent” on Government rights and oversight. To quote Bob Dylan – “the times they are a changin’.” 
 Continue Reading The Times They Are A Changin’ – Independent Research and Development May Not Be So “Independent” Any More

By Louis D. Victorino

A great deal of discussion has transpired regarding recent legislation that reportedly could alter significantly the established “follow-the-funds” test used for the allocation of intellectual property rights in data developed under a government contract. The legislation involved is a provision of the National Defense Authorization Act for Fiscal Year 2011 (the “Act”), signed into law on January 7, 2011. In particular, Section 824 of the Act provides “Guidance Relating to Rights in Technical Data” and, more importantly, amends Section 2320(a) of Title 10 of the United States Code, the provision that defines the allocation of rights in intellectual property under Government contracts.
 Continue Reading Frankenstein’s Monster: Data Rights Changes Adopted In The National Defense Authorization Act For Fiscal Year 2011

By Marko W. Kipa

With the passage of the National Defense Authorization Act for Fiscal Year 2008 (the “2008 Act”), Congress expanded the GAO’s jurisdiction to include bid protests in connection with civilian and defense contract task and delivery orders valued at over $10 million. See Section 843 of the 2008 Act, Pub. L. No. 110-181. Congress also included a sunset provision in the 2008 Act that limited that grant of expanded jurisdiction to 3 years – i.e., until May 27, 2011. See id. We previously discussed Section 843 of the 2008 Act and its implications here, here, and here.
 Continue Reading Has The Sun Set On GAO’s Civilian Contract Task And Delivery Order Bid Protest Jurisdiction?

By David S. Gallacher

On September 27, 2010, President Obama signed into law the Small Business Jobs and Credit Act of 2010 (Pub. L. No. 111-240). The Act is intended to free up capital by providing tax cuts for small businesses (some of which are temporary) and to promote exports of U.S. products, all with a view to stimulating the small business sector as an engine of job creation.  But, as usual, the Administration’s efforts to improve the economy through stimulus measures also give rise to new risks for companies doing business with the federal Government – whether as a prime or a subcontractor, as a large or a small business.
 Continue Reading Size Does Matter – Impacts Of The Small Business Jobs Act Of 2010

By David S. Gallacher

While Vice President Biden was busy touting Summer 2010 as the “Summer of Recovery” and the economic effects of the February 2009 Stimulus Act (a.k.a. the American Recovery and Reinvestment Act, the Recovery Act, ARRA, the Stimulus Act, etc.), the gears of the regulatory process ground steadily onward. Throughout the summer, the White House Office of Management and Budget (“OMB”) issued updated policy guidance implementing the ARRA requirements, and the rule-makers in the FAR Councils remained hard at work updating and (hopefully) finalizing the regulations implementing the finer details of the Recovery Act. Despite the fact that the ARRA funding officially expired on September 30, 2010 (meaning that any unobligated ARRA funds will now revert to the federal treasury to be saved or spent another day), the Government spent its summer fine-tuning the regulations. As the sun begins to set on the Recovery Act, and as the Summer of Recovery fades into the past, we summarize here some of the key features of the final Recovery Act rules promulgated over the last few months. 
 Continue Reading Bidding Adieu To The “Summer of Recovery”: Changes To ARRA Buy American And Reporting Requirements

By Bethany Hengsbach

An often-overlooked provision in the financial reform legislation now before Congress would allow employee whistleblowers to receive a reward of up to 30% of the fines collected by the U.S. Securities and Exchange Commission (“SEC”) and the U.S. Department of Justice (“DOJ”) from corporations who violate the Foreign Corrupt Practices Act (“FCPA”). We have reported in this blog on several occasions the increase in FCPA enforcement by the government in recent years. The passage of a bill containing this proposed whistleblower provision could lead to even more government enforcement, as well as multi-million dollar awards to whistleblowers.
 Continue Reading Proposed Whistleblower Provision Could Dramatically Increase FCPA Risk