Will an Unappealing Trend in Battlefield Contractor Suits Continue? Following A Pattern of Appellate Indecision—Fueled by the Government’s Equivocal Litigation Stances—the Fourth Circuit Mulls En Banc Review

By Daniel Russell Jr. and Raymond Biagini on September 18, 2019 Posted in Contractor Tort Liability & Immunity

It’s often said that hard cases make bad law. In the realm of contractor-on-the-battlefield lawsuits, hard cases seem to be making no law—at least at the appellate level.

As detailed in an amicus brief submitted by Covington on behalf of KBR last week in CACI Premier Technology Inc. v. Al Shimari, No. 19-1328 (4th Cir.), time and again in suits against battlefield contractors, appellate courts have refused to provide definitive rulings regarding threshold, immunity-based defenses. This chronic appellate-court indecision has caused unnecessarily-protracted litigation, which in turn has imposed enormous burdens on the U.S. military; permitted expansive discovery intruding upon sensitive military judgments; and rolled up litigation costs totaling tens of millions of dollars—costs that, in many instances, are reimbursed by the government and thus ultimately borne by taxpayers. In other words, lack of timely appellate review has resulted in the very harms that immunity and related defenses are designed to prevent. Ironically, a major reason why these suits have inflicted such harm on these important federal interests is the United States’ own equivocal and inconsistent litigation positions. Continue Reading

White House Seeks Input from Biotech Stakeholders on Bioeconomy

By Jennifer Plitsch and Bryan Byrd on September 17, 2019 Posted in Biodefense, Data Rights, Government Contracts Regulatory Compliance, Health Care Contracting, Procurement Policy, Procurement Reform, Public-Private Partnerships

Last week, the White House Office of Science and Technology Policy (“OSTP”) issued a request for information (“RFI”) to learn how the Government can more effectively “support scientific discovery, the development of technological advances, and increase the impact of a vibrant bioeconomy on the Nation’s vitality and our citizens’ lives.” 84 Fed. Reg. 47561 (Sep. 10, 2019). The Bioeconomy is the “infrastructure, innovation, products, technology, and data derived from biologically-related processes and science that drive economic growth, promote health, and increase public benefit.” Id. To establish guiding principles to promote and protect the U.S. Bioeconomy, OSTP is seeking input from interested parties, including “those with capital investments, performing innovative research, or developing enabling platforms and applications in the field of biological sciences, to include healthcare, medicine, pharmaceuticals, biotechnology, manufacturing, energy production, and agriculture.” Id. Of particular interest to government contractors, OSTP is seeking information regarding opportunities for public-private partnerships, infrastructure investments, and best practices for data sharing and data protection. Id. at 47562. Responses are due on or before 11:59 pm on October 22, 2019. We have included the specific topics on which OSTP seeks input below.

Navy Modifies Acquisition Supplement to Tighten Cybersecurity Requirements and Implement the Geurts Memorandum

By Susan B. Cassidy, Ashden Fein, Moriah Daugherty and Ian Brekke on September 11, 2019 Posted in Cybersecurity, Defense Industry, Government Contracts Regulatory Compliance, Supply Chain

Almost a year after Assistant Secretary of the Navy James Geurts issued his September 28, 2018 memorandum (Geurts Memo) imposing enhanced security controls on “critical” Navy programs, the Navy has issued an update to the Navy Marine Corps Acquisition Regulations Supplement (NMCARS) to implement those changes more formally across the Navy. Pursuant to this update, a new Annex 16 in the NMCARS provides Statement of Work (SOW) language that must be added into Navy solicitations and contracts where the Navy has determined “the risk to a critical program and/or technology warrants its inclusion.” In addition to the technical requirements reflected in the Geurts Memo, the Navy has added Subpart 5204.73 to the NMCARS that, among other things, instructs Contracting Officers (COs) to seek equitable reductions or consider reducing or suspending progress payments for contractor non-compliance with the Annex 16 and DFARS 252.204-7012 (DFARS clause) requirements.

DoD Releases Public Draft of Cybersecurity Maturity Model Certification and Seeks Industry Input

By Susan B. Cassidy, Samantha Clark, Ryan Burnette and Ian Brekke on September 6, 2019 Posted in Cybersecurity, Defense Industry, Government Contracts Regulatory Compliance, Supply Chain

On September 4, the Office of the Assistant Secretary of Defense for Acquisition released Version 0.4 of its draft Cybersecurity Maturity Model Certification (CMMC) for public comment. The CMMC was created in response to growing concerns by Congress and within DoD over the increased presence of cyber threats and intrusions aimed at the Defense Industrial Base (DIB) and its supply chains. In its overview briefing for the new model, DoD describes the draft CMMC framework as a “unified cybersecurity standard” for DoD acquisitions that is intended to build upon existing regulations, policy, and memoranda by adding a verification component to cybersecurity protections for safeguarding Controlled Unclassified Information (CUI) within the DIB. As discussed in a prior post, the model describes the requirements that contractors must meet to qualify for certain maturity certifications, ranging from Level 1 (“Basic Cyber Hygiene” practices and “Performed” processes) through Level 5 (“Advanced / Progressive” practices and “Optimized” processes), with such certification determinations to generally be made by third party auditors.

The CMMC establishes a new framework for defense contractors to become certified as cybersecurity compliant. DoD has stated that it intends to release Version 1.0 of the CMMC framework in January 2020 and will begin using that version in new DoD solicitations starting in Fall 2020. Notwithstanding the pendency of these deadlines, a large number of questions remain outstanding. DoD is seeking feedback on the current version of the model by September 25, 2019. Continue Reading

Section 889 Update: First Wave of Acquisition Prohibitions Take Effect

By Jeff Bozman, Samantha Clark and Susan B. Cassidy on September 3, 2019 Posted in Supply Chain

The FAR Council released an Interim Rule in August implementing part of Section 889 of the John S. McCain National Defense Authorization Act for Fiscal Year 2019. In this briefing, we highlight points where the Interim Rule provides clarity; definitional issues that remain unresolved; and new procedural requirements that government contractors should track.

The Interim Rule covers the portion of Section 889, subsection (a)(1)(A), that prohibits the federal government from acquiring certain telecommunications equipment/services from Huawei, ZTE, and other Chinese companies. Specifically: “The head of an executive agency may not … procure or obtain or extend or renew a contract to procure or obtain any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system.”

Section (a)(1)(A) took effect on August 13, 2019, although a 60-day window remains open for stakeholders to submit comments to be considered in the development of a final rule. Comments on the (a)(1)(A) Interim Rule are due by October 15, 2019.

The second part of Section 889 implementation, sections (a)(1)(B) and (b)(1), go into effect on August 13, 2020. Regulations for those sections remain pending within the government, but the definitions and waiver process established by (a)(1)(A) will be instructive for those regulations as well. Continue Reading

Hit the Road, Jack: GAO Dismisses Multiple LOGCAP V Bid Protests Just Two Days Before the Statutory Deadline for Decision, Highlighting the Perils and Breadth of the “Court of Competent Jurisdiction” Rule

By Hunter Bennett and Evan R. Sherwood on August 21, 2019 Posted in Bid Protests, Government Contracts Regulatory Compliance

On the eve of deciding an $82 billion dollar protest dispute, GAO dismissed a string of protests without reaching the merits because another contractor filed a protest of the same procurement at the Court of Federal Claims. AECOM Management Services, Inc., B-417506.2 et al., Aug. 7, 2019.

Another Executive Order on Buying American, and This One Has Teeth

By Michael Wagner, Scott A. Freling and Nooree Lee on July 23, 2019 Posted in Buy American, Procurement Policy

(This article was originally published in Law360 and has been modified for this blog.)

On July 15, 2019, President Trump issued an Executive Order on Maximizing Use of American-Made Goods, Products, and Materials. The EO directs the FAR Council to “consider” amending the Federal Acquisition Regulation’s provisions governing the implementation of the Buy American Act. This EO is the Trump administration’s latest – and most concrete – step toward enhancing domestic sourcing preferences and restricting foreign sources of supply for federal customers. And if implemented, the change promises to have dramatic implications for government contractors and their supply chains. Continue Reading

Back to Basics: Government’s Subjective Views About Contractor’s Performance Do Not Justify Termination for Default

By Alex Sarria and Carl Wiersum on July 22, 2019 Posted in Claims and Contract Disputes

The U.S. Court of Federal Claims recently overturned an agency’s decision to terminate a government contractor for default ─ finding that the government allowed a series of contract disputes, poor practices, conflicting personalities, and a lack of effective communication to cloud its termination analysis. The case serves as an important reminder that, when reviewing a termination for default, the Court gives little credence to the government’s “subjective beliefs” regarding the contractor’s ability to perform. Rather, the Court conducts an objective inquiry and scrutinizes the events, actions, and communications that led to the agency’s termination decision. Continue Reading

House and Senate Will Debate Bid Protest Policy

By Jeff Bozman and Jay Carey on July 18, 2019 Posted in Bid Protests, Defense Industry

The House of Representatives passed its version of the FY2020 National Defense Authorization Act (“NDAA”) last week. The headline story was the remarkably close, party-line vote: in contrast to past years, the bill received no Republican votes, and eight Democratic Members voted against it.

Those partisan dynamics obscured the inclusion of two important amendments – one Republican and one Democratic – regarding bid protest policy that the House quietly adopted in its bill. The provisions are not yet law, since the House and Senate must still resolve differences in their respective NDAAs through the conference process. In this post, we summarize these provisions and encourage government contractors to watch them closely in the coming months. Continue Reading

New York City, Vermont, and Other State and Local Governments Evaluating AI Trustworthiness

By Nooree Lee on July 16, 2019 Posted in Artificial Intelligence (AI), State and Local Procurements

Earlier this year, the White House issued an Executive Order on AI mandating that the National Institute of Standards and Technology develop a guide to federal engagement on AI technical standards. While the federal government’s actions have understandably garnered significant attention, state and local governments are also undertaking preliminary efforts to engage on the technical standards for AI procured and utilized by their agencies. Lee Tiedrich and Nooree Lee discuss those regulatory efforts on Inside Tech Media.