Recent news reports have raised a substantial question about who has authority to run the Department of Veterans Affairs (“VA”) in the wake of Dr. David Shulkin’s departure from the agency.  According to the White House, Dr. Shulkin resigned.  Meanwhile, Dr. Shulkin himself has publicly insisted that he did not resign and was instead fired.

This inconsistency sets up a potential dispute over whether, under the Federal Vacancies Reform Act of 1998 (“Vacancies Act”), President Trump had the authority to appoint Robert Wilkie, the Undersecretary of Defense for Personnel & Readiness, to serve as Acting Secretary of the VA.

As a result, contractors doing business with the VA have found themselves confronted with a series of knotty questions about the impact this uncertainty may have on the VA’s procurement priorities and actions.

Continue Reading If Shulkin Didn’t Resign, Who Runs the VA Until a New Secretary Is Confirmed? A Vacancies Act Puzzle

Over the last few months, we’ve reported on various government contracts decisions that illustrate the impact a release of claims provision can have on contractors.  A few weeks ago, we published a Feature Comment in The Government Contractor (titled “Release Me? Five Things Every Government Contractor Needs To Know Before Signing A Release Of Claims”)

A few weeks ago, we provided a few tips for negotiating and assessing a release contained in a contract modification, and discussed why the Civilian Board of Contract Appeals (CBCA) found that a global release contained in one of many contract modification was ambiguous.

Now, we consider a different scenario: what happens when a final payment clause requires the government to present a “final [payment] voucher” and “draft release of claims” form to the contractor—as opposed to the typical reverse scenario prescribed by FAR 52.232-5(h)—and the contractor fails to sign and return that voucher and release of claims form before the deadline stated therein?  According to the CBCA in Ahtna Envtl., Inc. v. Dept. of Transp., CBCA 5456 (December 22, 2016) (AEI), this type of self-effectuating deemed release will not bar a contractor’s claim when the government knew about the claim and considered it despite the alleged release.

Continue reading for a summary of the AEI decision and our key takeaways.
Continue Reading A self-effectuating deemed release of claims? Say it ain’t so.

You are reviewing a contract modification and notice a paragraph titled “Release of Claims.”  Do you know what claims will be released by this language?  Or worse, the contracting officer just issued a final decision rejecting your claim (under the Contract Disputes Act) because the release in a contract modification constituted an accord and satisfaction.  Did you sign that release and realize its impact?

The Civilian Board of Contract Appeals’ (CBCA) recent decision in Perry Bartsch Jr., Constr. Co. v. Dept. of the Int., CBCA 4865, 5071 (December 8, 2016) helps contractors answer these questions and understand the scope and contours of a release.  Generally, this case offers  important guidance about how to draft a release in an effective and narrow way, and the types of factors that the CBCA will consider when interpreting a release.  Specifically, this decision addresses the issue of whether an apparent global release of claims, contained in just one of many contract modifications, can extinguish all potential claims against the Government.

For a more complete review of Bartsch and its implications, please continue reading.

Continue Reading When does a contract release release a claim? A classic contract tongue twister.

DoD has issued a Final Rule that gives added protections to the technical data of privately developed commercial items incorporated into major systems, including major weapon systems.  This rule implements Section 813(a) of the National Defense Authorization Act (NDAA) for Fiscal Year 2016 and modifies 10 U.S.C.§ 2321(f).
Continue Reading DoD Finalizes Rule Expanding Contractor Rights in Technical Data

On October 30, 2015, the Department of Defense (“DoD” or the “Department”) issued a Final Rule amending the Defense Federal Acquisition Regulation Supplement (“DFARS”) and clarifying the scope of the DoD’s ability to evaluate and exclude contractors that represent “supply chain risks” in solicitations and contracts involving the development or delivery of IT products and services related to National Security Systems (“NSS”). The Final Rule clarifies that the DoD’s exclusion authority is limited to procurement of NSS, explains that decisions apply on a procurement-by-procurement basis, and removes the flow down requirement that was present in the Interim Rule. The Final Rule also encourages contracting officers to consider imposing a Government consent requirement for all subcontracts.  Our in-depth analysis of the Final Rule is available here.
Continue Reading DoD Issues Final Rule Addressing Exclusion of Contractors that Present Supply Chain Risk in National Security System Procurements

Following an 8-2 en banc decision issued by the United States Court of Appeals for the Eighth Circuit earlier this month, potential relators may think twice before bringing their False Claims Act (“FCA”) qui tam suits in the Eighth Circuit.  In Rille v. PricewaterhouseCoopers LLP, No. 11-3514 (8th Cir. Oct. 5, 2015), the Court vacated a district court order awarding two relators a percentage of the Government’s settlement of an FCA qui tam suit in which it had intervened, holding that when the government intervenes in an FCA action brought by a relator, and then settles both the claim brought by the relator and a different claim that does not overlap factually with the relator’s claim, the relator is entitled only to a share of the settlement of the claim that he brought.  The Court remanded the case to the district court to analyze whether there was factual overlap between the claims settled by the Government and the claims brought by the relators.
Continue Reading No Money for Nothing — Eighth Circuit Limits Relators’ Ability to Recover a Share of Government Settlements of Qui Tam Suits

A recent Court of Federal Claims decision serves as a reminder to contractors of the perils of firm-fixed-price contracts in unpredictable environments.

The case, Agility Defense & Government Services, Inc. v. United States, involved an “unusually high-risk” firm-fixed-price requirements contract between Agility Defense & Government Services (“Agility”) and the Defense Reutilization Management Services (“DRMS”).  Under that contract, Agility agreed to dispose of all surplus military property at six locations in Afghanistan, Kuwait, and Iraq, regardless of quantity.  In exchange, Agility received $45.2 million and the right to the proceeds of sales of scrap material from the surplus property.  In the solicitation process, DRMS provided offerors historical workload information for each of the six locations, but declined to provide workload projections or estimates.  From the start, the actual workload at almost every location was much greater than the historical baseline. Agility sought to recover $6.9 million in additional labor costs through an equitable adjustment on three different theories: (1) that a constructive change occurred; (2) that the historical information provided to offerors constituted a “negligent estimate;” and (3) that DRMS breached the warranty of reasonable accuracy in the solicitation phase.
Continue Reading COFC: Contractor Stuck With Bill For Substantially Higher Than Expected Costs Under Firm-Fixed Price Requirements Contract

The Government Accountability Office (“GAO”) recently published a report regarding the increased migration of unaccompanied alien children from El Salvador, Guatemala, and Honduras.  The report focused on the responses of officials from the Department of State (State), U.S. Agency for International Development (USAID), and the Department of Homeland Security (DHS).  These officials relied on first-hand interviews, meetings with government agencies and non-governmental organizations, and various data and information sources.  GAO conducted a similar study regarding progress of U.S. agencies in Central America in 2013, but this most recent study was targeted toward the increased migration of unaccompanied children.
Continue Reading GAO Issues Report on Agency Response to Migration of Unaccompanied Children from Central America