This is the twentieth in a series of Covington blogs on implementation of Executive Order 14028, “Improving the Nation’s Cybersecurity,” issued by President Biden on May 12, 2021 (the “Cyber EO”).  The first blogsummarized the Cyber EO’s key provisions and timelines, and the subsequent blogs described the actions taken by various Government agencies to implement the Cyber EO from June 2021 through November 2022.  This blog describes key actions taken to implement the Cyber EO during December 2022.

OMB Issues Guidance to Agencies Regarding Reporting of Major Cyber Incidents

The Office of Management and Budget (OMB) issued Memorandum M-23-03 to federal agencies on December 2, 2022 setting forth FY 2023 Guidance on Federal Information Security and Privacy Management Act (FISMA) requirements.  The memorandum highlights the Government’s shift in views on cybersecurity, noting that “[t]he Federal Government no longer considers any Federal system or network to be ‘trusted’ unless that confidence is justified by clear data; this means internal traffic and data must be considered at risk.”  Additionally, among the requirements discussed in the OMB Memorandum are those regarding agency reporting of “major” cyber incidents.  The Memorandum notes that FISMA directs agencies to notify Congress of a “major incident” and further directs OMB to define that term.  The Memorandum defines the term “major incident” as either:

  1. Any incident[1] that is likely to result in demonstrable harm to the national security interests, sovereign relations, or the economy of the United States, or to the public confidence, civil liberties, or public health and safety of the American people.  The Memorandum states that agencies should determine the level of impact of the incident by using the incident management process established in NIST SP 800-61, Computer Security Incident Handling Guide; or
  2. A breach that involves personally identifiable information (PII) that, if exfiltrated, modified, deleted, or otherwise compromised, is likely to result in demonstrable harm to the national security interests, foreign relations, or the economy of the United States, or to the public confidence, civil liberties, or public health and safety of the American people. 

The Memorandum states that agencies should assess each breach on a case-by-case basis to determine whether it meets the definition of a major incident.  However, the Memorandum expressly requires that any unauthorized modification of, unauthorized deletion of, unauthorized exfiltration of, or unauthorized access to the PII of 100,000 or more people be determined a major incident.  It notes that other factors may lead an agency to determine that a breach is a major incident.  The Memorandum also states that it does not preclude an agency from reporting an incident or breach to Congress that falls below the threshold of a major incident.

The Memorandum requires agencies to report to the Cybersecurity and Infrastructure Security Agency (CISA) and the OMB OFCIO within one hour of determining that a major incident occurred, and to update CISA and the OMB OFCIO within one hour of determining that an already-reported incident or breach is a major incident.  Agencies must notify the appropriate Congressional Committees and its Office of Inspector General (OIG) of a major incident no later than 7 days after the date on which the agency determines that it has a reasonable basis to include that a major incident has occurred.  The Memorandum states that the report to Congress should take into account the information known at the time of the report, the sensitivity of the details associated with the incident, and the classification level of the information.

The Memorandum also requires agencies to supplement their major incident reports to Congress “within a reasonable time” after additional information relating to the information is discovered.  Such supplemental report must include summaries of:

  • The threats and threat actions, vulnerabilities, and impacts relating to the incident;
  • The risk assessments conducted of the affected information systems before the date on which the incident occurred;
  • The status of compliance of the affected information systems with applicable security requirements at the time of the incident; and
  • The detection, response, and remediation actions. 

In addition, agencies must submit a supplemental report to Congress no later than 30 days after the agency discovers a breach constituting a major incident that includes:

  • A summary of information available about the breach, including how the breach occurred, based on information available to agency officials on the date the agency submits the report;
  • An estimate of the number of individuals affected by the breach, including an assessment of the risk of harm to affected individuals based on information available to agency officials on the date the agency submits the report; and
  • An estimate of whether and when the agency will provide notice to affected individuals, and a description of any circumstances necessitating a delay in providing such notice.

NIST Issues Final Guidance on Validating the Integrity of Computer Components

On December 9, 2022, the National Institute of Standards and Technology (NIST) issued Special Publication 1800-34, “Validating the Integrity of Computing Devices.”  This document describes prototype technical activities that OEMs and their approved manufacturers can use to prevent and detect counterfeiting, tampering, and undocumented changes to firmware and hardware, and corresponding customer practices to verify that client and server computer devices and components have not been tampered with or otherwise modified.  The document specifically addresses three use scenarios:  (1) Creation of Verifiable Platform Artifacts; (2) Verification of Components During Acceptance Testing; and (3) Verification of Components During Use, and identifies prototype verification technologies that can be used in each of these areas.

NIST Releases Draft Practice Guide on Securing IOT Devices

The NIST National Cybersecurity Center of Excellence issued a draft of Practice Guide 1800-36, “Trusted Interest of Things (IOT) Device Network-Layer Onboarding and Lifecycle Management,” on December 6, 2022.  The draft guide notes that providing Internet-of-Things (IOT) devices with the credentials and policies needed to join a network is a process known as “network-layer onboarding,” and states that establishing trust between a network and an IOT device prior to such onboarding is crucial for mitigating the risk of potential attacks.  The draft guide identifies standards, recommended practices, and commercially available technology to demonstrate various mechanisms for trusted network-layer onboarding of IOT devices.  Comments on the draft guide will be accepted by NIST through February 3, 2023.


[1] The Memorandum does not define the term “incident.”  FISMA defines “incident” as “an occurrence that — (A) actually or imminently jeopardizes, without lawful authority, the integrity, confidentiality, or availability of information or an information system, or (B) constitutes a violation or imminent threat of violation of law, security policies, security procedures, or acceptable use policies.”  44 U.S.C. § 3552(b)(2).

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Photo of Robert Huffman Robert Huffman

Bob Huffman represents defense, health care, and other companies in contract matters and in disputes with the federal government and other contractors. He focuses his practice on False Claims Act qui tam investigations and litigation, cybersecurity and supply chain security counseling and compliance…

Bob Huffman represents defense, health care, and other companies in contract matters and in disputes with the federal government and other contractors. He focuses his practice on False Claims Act qui tam investigations and litigation, cybersecurity and supply chain security counseling and compliance, contract claims and disputes, and intellectual property (IP) matters related to U.S. government contracts.

Bob has leading expertise advising companies that are defending against investigations, prosecutions, and civil suits alleging procurement fraud and false claims. He has represented clients in more than a dozen False Claims Act qui tam suits. He also represents clients in connection with parallel criminal proceedings and suspension and debarment.

Bob also regularly counsels clients on government contracting supply chain compliance issues, including cybersecurity, the Buy American Act/Trade Agreements Act (BAA/TAA), and counterfeit parts requirements. He also has extensive experience litigating contract and related issues before the Court of Federal Claims, the Armed Services Board of Contract Appeals, federal district courts, the Federal Circuit, and other federal appellate courts.

In addition, Bob advises government contractors on rules relating to IP, including government patent rights, technical data rights, rights in computer software, and the rules applicable to IP in the acquisition of commercial items and services. He handles IP matters involving government contracts, grants, Cooperative Research and Development Agreements (CRADAs), and Other Transaction Agreements (OTAs).

Photo of Susan B. Cassidy Susan B. Cassidy

Ms. Cassidy represents clients in the defense, intelligence, and information technologies sectors.  She works with clients to navigate the complex rules and regulations that govern federal procurement and her practice includes both counseling and litigation components.  Ms. Cassidy conducts internal investigations for government…

Ms. Cassidy represents clients in the defense, intelligence, and information technologies sectors.  She works with clients to navigate the complex rules and regulations that govern federal procurement and her practice includes both counseling and litigation components.  Ms. Cassidy conducts internal investigations for government contractors and represents her clients before the Defense Contract Audit Agency (DCAA), Inspectors General (IG), and the Department of Justice with regard to those investigations.  From 2008 to 2012, Ms. Cassidy served as in-house counsel at Northrop Grumman Corporation, one of the world’s largest defense contractors, supporting both defense and intelligence programs. Previously, Ms. Cassidy held an in-house position with Motorola Inc., leading a team of lawyers supporting sales of commercial communications products and services to US government defense and civilian agencies. Prior to going in-house, Ms. Cassidy was a litigation and government contracts partner in an international law firm headquartered in Washington, DC.

Photo of Ashden Fein Ashden Fein

Ashden Fein advises clients on cybersecurity and national security matters, including crisis management and incident response, risk management and governance, government and internal investigations, and regulatory compliance.

For cybersecurity matters, Mr. Fein counsels clients on preparing for and responding to cyber-based attacks, assessing…

Ashden Fein advises clients on cybersecurity and national security matters, including crisis management and incident response, risk management and governance, government and internal investigations, and regulatory compliance.

For cybersecurity matters, Mr. Fein counsels clients on preparing for and responding to cyber-based attacks, assessing security controls and practices for the protection of data and systems, developing and implementing cybersecurity risk management and governance programs, and complying with federal and state regulatory requirements. Mr. Fein frequently supports clients as the lead investigator and crisis manager for global cyber and data security incidents, including data breaches involving personal data, advanced persistent threats targeting intellectual property across industries, state-sponsored theft of sensitive U.S. government information, and destructive attacks.

Additionally, Mr. Fein assists clients from across industries with leading internal investigations and responding to government inquiries related to the U.S. national security. He also advises aerospace, defense, and intelligence contractors on security compliance under U.S. national security laws and regulations including, among others, the National Industrial Security Program (NISPOM), U.S. government cybersecurity regulations, and requirements related to supply chain security.

Before joining Covington, Mr. Fein served on active duty in the U.S. Army as a Military Intelligence officer and prosecutor specializing in cybercrime and national security investigations and prosecutions — to include serving as the lead trial lawyer in the prosecution of Private Chelsea (Bradley) Manning for the unlawful disclosure of classified information to Wikileaks.

Mr. Fein currently serves as a Judge Advocate in the U.S. Army Reserve.

Photo of Michael Wagner Michael Wagner

Mike Wagner helps government contractors navigate high-stakes enforcement matters and complex regulatory regimes.

Combining deep regulatory knowledge with extensive investigations experience, Mr. Wagner works closely with contractors across a range of industries to achieve the efficient resolution of regulatory enforcement actions and government…

Mike Wagner helps government contractors navigate high-stakes enforcement matters and complex regulatory regimes.

Combining deep regulatory knowledge with extensive investigations experience, Mr. Wagner works closely with contractors across a range of industries to achieve the efficient resolution of regulatory enforcement actions and government investigations, including False Claims Act cases. He has particular expertise representing individuals and companies in suspension and debarment proceedings, and he has successfully resolved numerous such matters at both the agency and district court level. He also routinely conducts internal investigations of potential compliance issues and advises clients on voluntary and mandatory disclosures to federal agencies.

In his contract disputes and advisory work, Mr. Wagner helps government contractors resolve complex issues arising at all stages of the public procurement process. As lead counsel, he has successfully litigated disputes at the Armed Services Board of Contract Appeals, and he regularly assists contractors in preparing and pursuing contract claims. In his counseling practice, Mr. Wagner advises clients on best practices for managing a host of compliance obligations, including domestic sourcing requirements under the Buy American Act and Trade Agreements Act, safeguarding and reporting requirements under cybersecurity regulations, and pricing obligations under the GSA Schedules program. And he routinely assists contractors in navigating issues and disputes that arise during negotiations over teaming agreements and subcontracts.

Photo of Ryan Burnette Ryan Burnette

Ryan Burnette advises defense and civilian contractors on federal contracting compliance and on civil and internal investigations that stem from these obligations. Ryan has particular experience with clients that hold defense and intelligence community contracts and subcontracts, and has recognized expertise in national…

Ryan Burnette advises defense and civilian contractors on federal contracting compliance and on civil and internal investigations that stem from these obligations. Ryan has particular experience with clients that hold defense and intelligence community contracts and subcontracts, and has recognized expertise in national security related matters, including those matters that relate to federal cybersecurity and federal supply chain security. Ryan also advises on government cost accounting, FAR and DFARS compliance, public policy matters, and agency disputes. He speaks and writes regularly on government contracts and cybersecurity topics, drawing significantly on his prior experience in government to provide insight on the practical implications of regulations.