Increased Suspensions and Debarments Bring Challenges for Small Business Contractors
By Alex Levine Newly released Department of Defense statistics show that the number of suspension and debarment actions initiated by defense agencies continue to rise, in some cases significantly. For example, in fiscal year 2015, the Army issued 456 debarments–a one year increase of 63 percent over the prior year. These numbers are indicative of a larger and continuing trend amongst federal agencies. Such agencies have increased their scrutiny on government contractors, resulting in greater suspension and debarment actions. Commentators . . . Read More
CBCA Expands its Approval of Subcontractors’ “Sponsored” Claims
By Julia Di Vito Typically, a subcontractor cannot appeal a Contract Disputes Act (“CDA”) claim to the Civilian Board of Contract Appeals (“CBCA”) because the subcontractor lacks privity of contract with the government. However, the CBCA allows subcontractors’ claims to be “sponsored” by the prime contractor, whereby the prime contractor files a CDA claim on behalf of the subcontractor, and later appeals it to the CBCA. Thus, even if the subcontractor is the party who has been damaged by the . . . Read More
10 Signs That a Contract May Give Rise to an OCI
By Michelle Litteken As many contractors are all too aware, OCI stands for “organizational conflict of interest.” An OCI arises when, because of other relationships or circumstances, a contractor may (1) be unable to render impartial advice or assistance to the government, (2) be unable to objectively perform contract work, or (3) have an unfair competitive advantage. An OCI can lead to disqualification from a procurement, termination of an existing contract, or sanctions. Given the severity of these potential consequences, . . . Read More
Update to SBA’s New ITVAR Size Rule
Back in February, we wrote about SBA’s new size rule for IT value-added resellers (“ITVARs”) and the major ramifications of the new rule. The rule requires ITVARs to comply with the nonmanufacturer rule when reselling IT products to the federal government under NAICS code 541519, footnote 18, which has a size standard of 150 employees. This was a 180-degree turnaround from SBA’s prior position on ITVARs, which were not previously required to comply with the nonmanufacturer rule. The upshot of the new rule is that ITVARs performing . . . Read More
U.S. Supreme Court’s Upcoming Ruling on False Claims Act Case May Have Major Impact on Government Contractors
By Ambi Biggs The U.S. Supreme Court is set to hear oral arguments next month in a False Claims Act (“FCA”) case that could significantly broaden the scope of the statute and resolve a split among the U.S. Circuit Courts. If the Supreme Court were to rule in favor of an implied theory of certification, government contractors across the country could be held liable for violating the FCA by breaching regulations and contractual provisions to which they never certified that . . . Read More
Preserving the Attorney-Client Privilege when Conducting an Internal Investigation
You may recall that, back in July 2014, we advised that the D.C. Circuit Court of Appeals had overturned a D.C. District Court decision in a False Claims Act case that required the results of an internal investigation, which the investigating company had asserted were protected by the attorney-client privilege, to be turned over to the whistleblower’s counsel. The trial court had supported its decision against the application of the privilege by, among other things, pointing out that the employees that had been interviewed—by non-attorneys—had not been told that the interview was being conducted for the purpose of obtaining or providing legal . . . Read More
Paid Sick Leave for Federal Contractors is One Step Closer to Reality
By Corey Argust For employers, it seems like every time you turn around there is a change in the law or regulations to add to the list of compliance challenges. Federal contractors can now add paid sick leave to that list. On February 25, 2016, the Department of Labor (“DOL”) released its proposed rule for providing employees working on federal contracts with sick leave. The proposed rule would implement Executive Order 13706, which President Obama signed on September 7, 2015. . . . Read More
CFIUS Annual Report Shows Items of Interest for Government Contractors
By Kimi Murakami The Committee on Foreign Investment in the United States (“CFIUS”) recently issued its Annual Report to Congress regarding transactions that they reviewed during 2014. Below are highlights of trends and issues gleaned from the report, as well as a few best practices that contractors performing work for the U.S. federal government may find interesting regardless of whether your business may soon be the target of a non-U.S. buyer. What is CFIUS? To guard against foreign investment that . . . Read More
WOSBs: $17.8 Billion in FY15 Spending and MORE NAICS Codes!
By Megan Connor On March 2, 2016, SBA announced that federal government spending in FY 2015 met the 5% spending goal for WOSBs. According to the SBA, 5.05% or $17.8 billion of all federal small business eligible contracting dollars were awarded to WOSBs. This is the first time in the history of the WOSB Program that the goal has been met. This great news was then followed on March 3, 2016 , by SBA’s publishing of updated NAICS codes list for EDWOSB and WOSB set-aside and sole source contracts, . . . Read More
Kingdomware Oral Arguments—Remand to Lower Courts Is a Possibility
“Yeah, it’s a contract,” conceded Department of Justice (“DOJ”) attorney Zachary Tripp during recent oral arguments in Kingdomware Technologies Inc. v. United States. According to Tom Saunders, attorney for Kingdomware, that concession should begin and end the case currently before the Supreme Court on the issue of whether the Department of Veterans Affairs (“VA”) is required to set-aside awards for Veteran-Owned Small Businesses and Service-Disabled Veteran-Owned Small Businesses when ordering from the Federal Supply Schedules (“FSS”). Unfortunately for Kingdomware—and the . . . Read More