Just over a year after launching the Procurement Collusion Strike Force (“PCSF”), the U.S. Department of Justice’s Antitrust Division (“DOJ”) announced new measures to further its pursuit of antitrust and related crimes in government procurement, grant, and program funding.  These changes expand the PCSF’s enforcement capacity and signal DOJ’s enduring—and intensifying—commitment to the PCSF’s mission.

The PCSF has added 11 new national partners: the Department of Homeland Security Office of the Inspector General, the Air Force Office of Special Investigations, and nine new U.S. Attorneys.  As a result, the growing PCSF coalition now includes 29 agencies and offices, including U.S. Attorneys in 22 federal judicial districts; the Federal Bureau of Investigation; and Offices of Inspectors General at six federal agencies.  The PCSF also named the Antitrust Division’s Daniel Glad as the Strike Force’s first permanent director, solidifying the PCSF’s institutional role at DOJ.  Glad previously served as an Assistant Chief at the Antitrust Division’s Chicago Office.
Continue Reading Expansion of the Procurement Collusion Strike Force

As described in an earlier blog post, the Department of Defense (DoD) released an Interim Rule on September 29, 2020 that address DoD’s increased requirements for assessing whether contractors are compliant with the 110 security controls in National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171 (NIST 800-171).[1]  Under this new Interim Rule, DoD offerors must have a current assessment on file with DoD to document their compliance with NIST 800-171 before they can be eligible to be considered for award.  The Interim Rule specifically requires contractors to ensure that a summary score from an assessment conducted under DoD’s NIST 800-171 Assessment Methodology is submitted into a DoD enterprise application called the Supplier Performance Risk System (SPRS).[2]  We evaluate below how DoD may use the NIST 800-171 assessment scores in SPRS, as well as how updates to SPRS more generally are likely to impact contractors.
Continue Reading How is DoD Planning to Use the Supplier Performance Risk System (SPRS)?

On October 21, 2020 the Department of Labor’s Office of Federal Contract Compliance Programs (“OFCCP”) published a Request for Information (“RFI”) seeking voluntary submissions of workplace diversity and inclusion training information and materials from federal contractors, federal subcontractors, and their employees. The RFI was published pursuant to Executive Order 13950, Combating Race and Sex Stereotyping (“EO”) issued on September 22, 2020, which prohibited certain “divisive concepts” in workplace trainings and instructed OFCCP to solicit information from federal agencies and contractors about the content of their training programs.  The EO also directed OFCCP to establish a hotline to investigate complaints received under the EO, as well as Executive Order 11246. The hotline, and a corresponding email address, were established on September 28, 2020. We provided a full description and explanation of the requirements of the EO here.

Under the new RFI, contractors may submit comments and other information to OFCCP by December 1, 2020, but any submission of information is strictly voluntary.  As discussed below, prior to making any submission, contractors should consider carefully the nuances of the EO and RFI and the potential implications of making a voluntary submission.Continue Reading Department of Labor Requesting Information on Federal Contractor Workplace Diversity Training

Under the False Claims Act’s (“FCA”) first-to-file bar, “no person other than the Government may intervene or bring a related action based on the facts underlying the pending action.”  But can a relator amend her complaint to add, remove, or substitute relators without violating the first-to-file bar?  Recently, the Third…
Continue Reading Third Circuit Addresses the Scope of the FCA’s First-to-File Bar

On September 29, 2020, the Department of Defense (DoD) released an interim rule that industry hoped would provide clear guidance with regard to DoD’s implementation of its Cybersecurity Maturity Model Certification (CMMC) framework.  The vast majority of the rule focuses on DoD’s increased requirements for confirming that contractors are currently in compliance with all 110 security controls in National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171 (NIST 800-171).  The interim rule also includes a clause for adding CMMC as a requirement in a DoD contract, but the clause fails to address many of the questions that industry has with regard to implementation of the CMMC program.  The rule becomes effective November 30, 2020.  We have written previously on NIST 800-171 and the CMMC here and here respectively.

DoD has been focused on improving the cyber resiliency and security of the Defense Industrial Base (DIB) sector for over a decade.  The Council of Economic Advisors estimates that malicious cyber activity cost the U.S. economy between $57 billion and $109 billion in 2016.  The interim rule is one of multiple efforts by DoD focused on the broader supply chain security and resiliency of the DIB and builds on existing FAR and DFARS clause cybersecurity requirements.  Increasing security concerns coupled with recent high-profile data breaches have led DoD to move beyond self-certification to auditable verification systems when it comes to protecting sensitive Government information.Continue Reading Department of Defense’s Interim Rule Imposes New Assessment Requirements But is Short on Detail on Implementation of CMMC

On September 22, 2020, President Trump issued the Executive Order on Combating Race and Sex Stereotyping (“EO”) establishing requirements aimed at “promoting unity in the Federal workforce,” by prohibiting workplace training on “divisive concepts,” including “race or sex stereotyping” and “race or sex scapegoating” as newly-defined in the EO.  The EO is broadly applicable to executive departments and agencies, Uniformed Services, Federal contractors, and Federal grant recipients.  The EO expands on a letter issued in early September by the Director of the Office of Management and Budget (“OMB”) that directed all agencies to begin to identify contracts or other agency spending on trainings that include “critical race theory,” “white privilege,” or “un-American propaganda,” in an effort to ensure “fair and equal treatment of all individuals in the United States.”

Following the EO, on September 28, 2020, OMB issued a Memorandum for the Heads of Executive Departments and Agencies (the “Memo”) with additional guidance aimed at assisting agencies in identifying diversity and inclusion trainings for agency employees that may be subject to the EO.  The Memo suggests that agencies conduct keyword searches of training materials for specific terms, such as “intersectionality,” “systemic racism,” and “unconscious bias.”  Although the Memo primarily explains the terms of the EO, it also provides additional insight concerning the breadth of agency trainings that may ultimately be considered to violate the terms of the EO, which are described below.

Although the EO is likely to be subject to legal challenge (as more fully discussed below), federal contractors, including subcontractors and vendors, could be subject to the compliance requirements outlined below as soon as November 21, 2020.
Continue Reading President Trump Issues Executive Order Prohibiting “Divisive Concepts” in Federal Contractor Trainings

On August 13, 2020, the Office of Management and Budget (OMB) released new revisions to its Guidance for Grants and Agreements set forth under 2 CFR (commonly referred to as the Uniform Guidance).  The Uniform Guidance governs the terms of federal funding issued by agencies, including grants, cooperative agreements, federal…
Continue Reading New Section 889 Restrictions Included in Updated Uniform Guidance Regulations from the Office of Management and Budget

The Government Accountability Office (“GAO”) released a decision on Friday finding that the Department of Homeland Security (“DHS”) followed the wrong order of succession after Secretary Kirstjen Nielsen resigned in April 2019.  As a result, the Acting Secretaries who have served since then were invalidly selected.  In particular, GAO has questioned the appointments of Acting Secretary Chad Wolf, former Acting Secretary Kevin McAleenan, and Deputy Secretary Kenneth Cuccinelli.

GAO’s decision tees up a thorny question for DHS contractors:  If these officials were invalidly selected, what does it mean for the agency’s policies and procurement decisions made during their tenure?Continue Reading [Updated] If the Acting DHS Secretary Was Unlawfully Selected, What Does that Mean for DHS Procurements?

Earlier this week, the Federal Circuit issued a decision in The Boeing Company v. United States that clears the way for resolution of Boeing’s substantive challenge to a controversial FAR provision that can give the government windfall recoveries in Cost Accounting Standards (CAS) matters.  The Federal Circuit decision is notable for three reasons.  First, in rejecting the government’s argument that Boeing had waived its right to attack the relevant FAR provision, the court clarified the circumstances in which a contractor will be found to have waived its rights to object to FAR provisions.  Second, in concluding that the Court of Federal Claims had jurisdiction to consider the dispute, the court provided a useful primer on the three different kinds of jurisdiction available under the Tucker Act.

Finally, the Federal Circuit’s remand means the Court of Federal Claims will now address Boeing’s substantive challenge to FAR 30.606, which directs contracting officers to ignore offsets that save the government money when calculating the impact of changes to a contractor’s cost accounting practices.  Boeing’s argument that this provision amounts to a breach of contract and an illegal exaction will now be resolved on the merits.Continue Reading Federal Circuit Rejects Government’s Waiver and Jurisdiction Defenses, Paving the Way for a CAS Showdown at the Court of Federal Claims

Last week, President Trump issued an executive order aimed at encouraging the expansion American manufacturing of essential medical products — Executive Order on Ensuring Essential Medicines, Medical Countermeasures, and Critical Inputs Are Made in the United States (August 6, 2020) (the “Order”).  The Order sets forth an ambitious plan requiring extensive agency action on a tight timeline that suggests a significant impact.  Closer examination of the Order raises significant questions about the practicalities of implementation and the realistic impact of the Order once the substantial stated exceptions are taken into account.

The List

The heart of the Order is a list of Essential Medicines, Medical Countermeasures (“MCMs”), and Critical Inputs to which the Order’s requirements apply — but the key components of this list do not yet exist.  Instead, the Order directs the Food and Drug Administration (“FDA”) to produce the list within 90 days and to include on the list Essential Medicines, MCMs, and Critical Inputs “that are medically necessary to have available at all times in an amount adequate to serve patient needs and in the appropriate dosage forms.”

The Order provides the following definitions that give some insight into what may be on the FDA’s eventual list:
Continue Reading Trump Administration Increases Uncertainty for Pharmaceutical Manufacturing