On behalf of the Professional Services Council (PSC), this past week Covington filed an amicus brief in the U.S. Supreme Court in support of the petitioner in The GEO Group, Inc. v. Menocal (No. 24-758). The brief urges the Court to grant certiorari and, ultimately, to hold that government contractors are entitled to immediately appeal a district court’s denial of derivative sovereign immunity under the collateral order doctrine.
Continue Reading Covington Submits Supreme Court Amicus Curiae Brief Addressing Derivative Sovereign Immunity for Government ContractorsFifth Circuit Adds New Wrinkle to Ongoing Fight Over Federal Contract Worker Minimum Wage Requirement
Update: On March 14, 2025, President Trump issued an Executive Order, “Additional Rescissions of Harmful Executive Orders and Actions,” which revoked Executive Order 14026, discussed below. The U.S. Department of Labor has stated it is “no longer enforcing Executive Order 14026 or the implementing rule (29 CFR part 23) and will take steps, including rescinding 29 CFR part 23, to implement and effectuate the revocation of Executive Order 14026.” We will continue to monitor further developments.
Earlier this month, the Fifth Circuit ruled in favor of a Biden administration order raising the minimum wage of many types of federal contract workers. The executive order remains subject to litigation (in both the Fifth Circuit and elsewhere), but is currently effective throughout the country, with a narrow exception for certain state agencies.
President Biden’s Executive Order 14026 (“the EO”), issued in April 2021, raised the hourly minimum wage to $15.00 for federal contract workers for the following contract types:
- Procurement contracts for construction projects covered by the Davis-Bacon Act (“DBA”);
- Service contracts falling under the Service Contract Act (“SCA”);
- Concessions contracts, including those excluded from the SCA by DOL regulations at 29 C.F.R. 4.133(b); and,
- Contracts related to federal property or lands and connected to providing services for federal employees, their dependents, or the general public.
EO 14026 directs the U.S. Department of Labor to annually update the hourly minimum wage. We wrote in October 2024 about DOL’s annual update effective January 1, 2025, which raised the minimum wage for covered contracts from $17.20 to $17.75. More details are below.
Continue Reading Fifth Circuit Adds New Wrinkle to Ongoing Fight Over Federal Contract Worker Minimum Wage RequirementTimeline of Key Developments Related to Recent Executive Actions
As previously discussed on this blog, President Trump issued several executive orders (“EOs”) and memoranda, many of which may have implications for federal contractors and grant recipients. During the first 30 days of the second Trump Administration, Covington’s Government Contracts Practice Group has tracked developments related to these EOs
Continue Reading Timeline of Key Developments Related to Recent Executive ActionsU.S. Federal and State Governments Moving Quickly to Restrict Use of DeepSeek
Last month, DeepSeek, an AI start-up based in China, grabbed headlines with claims that its latest large language AI model, DeepSeek-R1, could perform on par with more expensive and market-leading AI models despite allegedly requiring less than $6 million dollars’ worth of computing power from older and less-powerful chips. Although
Continue Reading U.S. Federal and State Governments Moving Quickly to Restrict Use of DeepSeek
FY2025 NDAA: Congressional Efforts to Bolster U.S. Resilience Against Chinese Tech and Influence
The FY 2025 National Defense Authorization Act (“NDAA”) sustains Congress’s continued focus on countering China’s expanding influence and enhancing U.S. resilience in an era of great power competition. This year’s legislation reflects the practice of carrying the State Department and Intelligence Authorization Acts within the NDAA—marking the third consecutive year that these critical measures have been advanced in tandem. The Foreign Relations and Intelligence Committees in both chambers of Congress have increasingly adopted the Armed Services Committees’ playbook, embedding China-focused legislation modeled on past defense measures in their respective authorizations. This blog examines key provisions designed to address what Congress views as strategic challenges posed by China while closing loopholes that could confer military, economic, or technological advantages to Beijing. We divide these provisions into the following five categories: (1) provisions that address potential security risks linked to Chinese-origin technology; (2) provisions that limit the transfer of U.S. technology or data to China; (3) so-called “time to choose” provisions that curtail Department of Defense (“DoD”) engagement with third parties that engage with China; (4) provisions that tackle a range of broader geopolitical concerns; and (5) studies and reports to identify emerging issues and concerns.
Continue Reading FY2025 NDAA: Congressional Efforts to Bolster U.S. Resilience Against Chinese Tech and Influence
January 2025 AI Developments – Transitioning to the Trump Administration
This is the first in a new series of Covington blogs on the AI policies, executive orders, and other actions of the new Trump Administration. This blog describes key actions on AI taken by the Trump Administration in January 2025.
Outgoing President Biden Issues Executive Order and Data Center Guidance for AI Infrastructure
Before turning to the Trump Administration, we note one key AI development from the final weeks of the Biden Administration. On January 14, in one of his final acts in office, President Biden issued Executive Order 14141 on “Advancing United States Leadership in AI Infrastructure.” This EO, which remains in force, sets out requirements and deadlines for the construction and operation of “frontier AI infrastructure,” including data centers and clean energy facilities, by private-sector entities on federal land. Specifically, EO 14141 directs the Departments of Defense (“DOD”) and Energy (“DOE”) to lease federal lands for the construction and operation of AI data centers and clean energy facilities by the end of 2027, establishes solicitation and lease application processes for private sector applicants, directs federal agencies to take various steps to streamline and consolidate environmental permitting for AI infrastructure, and directs the DOE to take steps to update the U.S. electricity grid to meet the growing energy demands of AI.
On January 14, and in tandem with the release of EO 14141, the Office of Management and Budget (“OMB”) issued Memorandum M-25-03 on “Implementation Guidance for the Federal Data Center Enhancement Act,” directing federal agencies to implement requirements related to the operation of data centers by federal agencies or government contractors. Specifically, the memorandum requires federal agencies to regularly monitor and optimize data center electrical consumption, including through the use of automated tools, and to arrange for assessments by certified specialists of data center energy and water usage and efficiency, among other requirements. Like EO 14141, Memorandum M-25-03 has yet to be rescinded by the Trump Administration.
Continue Reading January 2025 AI Developments – Transitioning to the Trump AdministrationFAR Council Proposes New FAR CUI Rule
On January 15, 2025, the Federal Acquisition Regulation (“FAR”) Council proposed a new FAR Controlled Unclassified Information (“CUI”) rule (“proposed rule”) to establish uniform requirements for handling CUI with broad applicability to solicitations and contracts across the federal government.
The proposed rule, in development for roughly a decade, represents a
Continue Reading FAR Council Proposes New FAR CUI RulePresident Trump Issues Numerous Executive Orders with Potential Impacts on Federal Contractors and Grant Recipients
In his first few days in office, President Trump issued several executive orders (“EOs”) and memoranda, many of which may have implications for federal contractors and grant recipients, including the following:
Continue Reading President Trump Issues Numerous Executive Orders with Potential Impacts on Federal Contractors and Grant RecipientsFederal Highway Administration Publishes Final Rule Rescinding Longstanding Buy America Waiver for Manufactured Products
On January 14, 2025, the Department of Transportation’s (“DOT”) Federal Highway Administration (“FHWA”) published a final rule ending its longstanding waiver of Buy America requirements for manufactured products (the “Manufactured Products Waiver”) and setting out new standards for the use of domestic content on FHWA-funded infrastructure projects. As discussed in our previous post, FHWA proposed rescinding its decades-old waiver in March 2024 in accordance with the 2021 Infrastructure Investment and Jobs Act’s Build America, Buy America (“BABA”) focus on expanding Buy America coverage and discouraging the use of general applicability waivers. The final rule is similar in substance to the proposed rule but adds a staggered implementation period, which will allow contractors additional time to come into compliance.
Continue Reading Federal Highway Administration Publishes Final Rule Rescinding Longstanding Buy America Waiver for Manufactured ProductsThe Proposed FAR Rule on OCIs: Big Changes May Be Coming
Yesterday, the FAR Council issued a proposed rule that would update the U.S. Government’s approach to organizational conflicts of interest (OCIs). While the proposed rule is not finalized and may change in response to forthcoming comments from interested parties, the proposed rule contemplates major changes to the FAR’s existing framework in this area. In this post, we summarize the background leading up to the proposed rule and highlight key areas of proposed change.