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Government Contracts Legal Forum

A blog by Crowell and Moring LLP in General

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Entries in this blog

Fastest 5 Minutes

Cybersecurity, Health Information Technology This week’s episode covers a False Claims Act whistleblower lawsuit involving failure to comply with federal cybersecurity requirements, a new CISA cyber incident reporting tool, and a proposed rule to implement an HHS-wide policy relating to health information technology, and is hosted by Peter Eyre. Crowell & Moring’s “Fastest 5 Minutes” is a biweekly podcast that provides a brief summary of significant government contracts legal and regulat

“Et ‘two,’ GAO?”:Recent Sustain on the Rule of Two Reminds Agencies of the Importance of Accurate Market Research

For the first time in nearly a decade, GAO in Knudsen Systems, Inc. sustained a protest challenging an agency’s decision to set aside a procurement for small businesses.  The decision involves the so-called “Rule of Two”:  under FAR 19.502-2(b), agencies must set aside for small businesses a procurement with an anticipated dollar value of more than $150,000 where the agency’s market research demonstrates there is a reasonable expectation at least two responsible small business offerors can meet

Know Your Rights: SBCA Issues Two Important Reminders to Contractors

The Armed Services Board of Contract Appeals (Board) recently issued notable reminders to contractors regarding its jurisdictional authority and the importance of timely filing claims.  The Board explained in DSME Construction Co., Ltd., ASBCA 63878 (July 30, 2024), that it may retain jurisdiction over a dispute even when a different forum is listed in the contract.  In Platinum Services., Inc., ASBCA No. 63878 (Aug. 1, 2024), the Board instructed contractors to be mindful of the CDA’s statute o

California Dental Offices Settle FCA Allegations Regarding Second-Draw PPP Loans for $6.3M

On August 8, 2024, the U.S. Attorney’s Office for the Central District of California announced a $6.3 million False Claims Act settlement with West Coast Dental Administrative Services LLC (formerly West Coast Dental Services Inc.) and its founders and former owners due to seven improper second-draw Paycheck Protection Program loans received by West Coast Dental and affiliated dental offices.  Relator LLC—the same entity whose complaint in Golden Empire Mortgage was held to be barred by

August 2024 Bid Protest Sustain of the Month

As Summer Comes to a Close, So Does GAO’s Sustain Drought In last month’s Bid Protest Sustain of the Month installment, we noted that GAO was suffering from a sustain drought, having failed to issue a single sustained protest decision in the month of July.  But it appears that drought is over!  The final tally for August shows that GAO issued a whopping six separate sustained protest decisions in August 2024.  Four of these decisions—issued at the end of the month—are still under Protective

FCA Complaint Based on PPP Information Pulled from PandemicOversight.gov Website Barred

On August 5, 2024, in United States ex rel. Relator LLC v. Howard D. Kootstra and Golden Empire Mortgage, Inc., Case No. 1:22-cv-00924-TLN-CDB (E.D. Cal.), the District Court for the Eastern District of California granted a motion to dismiss allegations that a mortgage lender made false or fraudulent statements on its Paycheck Protection Program (PPP) application in violation of the False Claims Act where the relator could not overcome the FCA’s public disclosure bar. Relator LLC, a corp

Special Edition of the Fastest 5 Minutes

SBA Proposed Rule to Update Various SBA Small Business Programs This special edition covers the SBA’s August 2024 proposed rule to update and clarify various small business programs, and is hosted by Yuan Zhou and Olivia Lynch. Crowell & Moring’s “Fastest 5 Minutes” is a biweekly podcast that provides a brief summary of significant government contracts legal and regulatory developments that no government contracts lawyer or executive should be without. Listen: Crowell.com | PodBean |

HHS Proposes Using Procurement Policy to Push Health IT Standards

The Department of Health and Human Services (HHS) continues its push on health data interoperability with a proposed rule, HHS Acquisition Regulation: Acquisition of Information Technology; Standards for Health Information Technology.  Specifically, HHS proposes to modify the Health and Human Service Acquisition Regulation (HHSAR) to implement an HHS-wide policy to align requirements related to the procurement of health IT with standards and implementation specifications adopted by the Office of

Natural Intelligence: NIST Releases Draft Guidelines for Government Contractor Artificial Intelligence Disclosures

On August 21, 2024, the National Institute of Standards and Technology (NIST) released the Second Public Draft of Digital Identity Guidelines (hereinafter, “Draft Guidelines”) for final review. The Draft Guidelines introduce potentially notable requirements for government contractors using artificial intelligence (AI) systems. Among the most significant draft requirements are those related to the disclosure and transparency of AI and machine learning (ML). By doing so, NIST underscores its commi

SBA Proposed Rule Would Enact Material Changes as Well as Promote Regulatory Uniformity Across Size and Status Programs

On August 23, 2024, the Small Business Administration (SBA) posted a proposed rule to update and clarify aspects of various SBA small business programs, including but not limited to the HUBZone Program and 8(a) Business Development Program.  This proposed rule followed SBA’s July 22, 2024 notification of tribal consultation meeting and request for comments (which Crowell covered here).  A major theme of the proposed rule is promoting uniformity across the size and status certification pr

2024 Bid Protest Sustain of the Month

The following is an installment in Crowell & Moring’s Bid Protest Sustain of the Month Series.  In this series, Crowell’s Government Contracts Practice will keep you up to date with a summary of the most notable bid protest sustain decision each month.  Below, Crowell Consultant Cherie Owen discusses Peraton Inc., B-422409.2, B-422409.3, July 22, 2024, which provides helpful insight regarding protest timelines. July 2024 was a drought month for the protest world: GAO did not issue a

Criminal Enforcement Considerations for Gov’t Contractors

The federal government’s renewed focus on corporate misconduct and the recent expansion of its disclosure and whistleblower policies have thrust corporate criminal liability into the spotlight. It may come as no surprise that corporations are legal persons capable of committing crimes, but the scope of potential criminal liability for corporations is broader than one may realize. Government contractors, in particular, operate in a highly complex regulatory environment and have additional

Fastest 5 Minutes

Clearances for Joint Ventures, Mentor-Protégé Program, GSA Schedule This week’s episode covers a DoD memorandum establishing procedures for covered joint venture facility security clearances, an SBA notice relating to the Mentor-Protégé Programs, and an upcoming mass modification to all existing GSA Multiple Award Schedule contracts, and is hosted by Peter Eyre and Yuan Zhou. Crowell & Moring’s “Fastest 5 Minutes” is a biweekly podcast that provides a brief summary of significant governm

Enhanced Review by the Department of Energy’s Office of Inspector General into the Loan Programs Office Poses Increased Risks to Loan Program Applicants

As the Department of Energy’s (“DOE”) Loan Programs Office (“LPO”) continues to finance clean energy manufacturing and deployment in the United States, the recent announcement by the DOE’s Office of Inspector General’s (“DOE OIG”) that it intends to scrutinize LPO’s due diligence process increases the risk to program applicants. According to a recent notice issued on SAM.gov, the DOE OIG intends to issue a sole source contract for legal support “assessing the policies and procedures” for the due

“Help Wanted”: Justice Department Debuts its Corporate Whistleblower Awards Pilot Program

On August 1, 2024, Deputy Attorney General Lisa Monaco unveiled the Department of Justice’s new Corporate Whistleblower Awards Pilot Program. The announcement marks the conclusion of the Department’s previously announced “sprint” towards a pilot program, as DAG Lisa Monaco first previewed back in March of this year.  Under this three-year pilot, whistleblowers who voluntarily provide DOJ with “original” information that leads to a successful corporate prosecution may be rewarded with a s

Agency Said Awardee Fully Mitigated OCI; GAO Says: “Nope!”

Most organizational conflict of interest (OCI) sustains arise where the record shows that an agency failed to analyze the potential for a conflict.  But GAO’s decision in A Square Group, LLC, is a rarer type of OCI sustain: the agency considered the purported OCI and documented its conclusion that the OCI had been mitigated.  However, GAO found that the agency’s conclusions were unreasonable, and the OCI risk remained. The procurement sought a contractor to perform “operational analytics

Fastest 5 Minutes

Procurement Integrity Act, Federal Bribery Law This week’s episode covers a GAO protest regarding the Procurement Integrity Act and a U.S. Supreme Court decision narrowing the scope of federal bribery law, and is hosted by Peter Eyre. Crowell & Moring’s “Fastest 5 Minutes” is a biweekly podcast that provides a brief summary of significant government contracts legal and regulatory developments that no government contracts lawyer or executive should be without. Listen: Crowell.com | Po

SBA Seeks Comment on Prospective Policy Change Regarding Mentor-Protégé Joint Venture Eligibility For Multiple Award Contracts

On July 22, 2024, the Small Business Administration (SBA) posted a notification of tribal consultation meeting and request for comments regarding updates to the HUBZone and 8(a) Business Development Programs.  Of critical importance for any contractors participating in the SBA’s Mentor-Protégé Program, SBA is also seeking comments on prospective policy changes addressing joint venture participation in SBA’s programs.  SBA has identified perceptions that: mentor-protégé joint ventures ar

June 2024 Bid Protest Sustain of the Month

GAO issued three sustain decisions in June, but the Sparksoft Corporation decision stands out for its discussion of prejudice.  In Sparksoft, the Centers for Medicare and Medicaid Services (CMS) sought to procure supplemental security testing for the agency’s Center for Clinical Standards and Quality (CCSQ).  CMS evaluated Sparksoft and the eventual awardee, TSG, as follows:             Sparksoft protested, challenging numerous areas of the agency’s evaluation, including challenges under

Fastest 5 Minutes

FAR Part 40, Cyber Reporting, Bid Protest This week’s episode covers a proposed rule to replace the phrase “significant deficiency” with “material weakness” for the government’s evaluation of contractor business systems, a GAO report on Defense Counterintelligence and Security Agency’s current cybersecurity policies and procedures, and a nationwide preliminary injunction that halts the U.S. Department of Labor from enforcing three key elements of new regulations related to the Davis-Bacon Ac

Nationwide Injunction Halts Key Provisions of Davis-Bacon Act Regulations

On June 24, 2024, the U.S. District Court for the Northern District of Texas issued a nationwide preliminary injunction, stopping the U.S. Department of Labor (“DOL”) from enforcing three key elements of regulations related to the Davis-Bacon Act and Related Acts (“DBA” or “Act”).  The court order issued in Associated General Contractors v. U.S. Department of Labor will provide significant comfort and certainty to contractors that perform work on federally funded construction projects. A

Supreme Court Rules Gratuity Insufficient For Conviction Under Federal Bribery Law

On June 26, 2024, a 6-3 majority of the U.S. Supreme Court narrowed the scope of federal bribery law by ruling that 18 U.S.C. § 666 does not cover gratuities provided to officials for past acts. The Court held that Section 666, which outlaws bribery of state and local officials when federal funds are involved, does not extend to “gratuities” that follow an official act, in large part because regulation of such gifts is a matter of state and local law.  The case before the Court, Snyder v

Taking Care of Business (Systems): DoD Proposes to Change the Definition of a Business System Deficiency 

The Department of Defense (DoD) recently announced that it seeks public comments on a proposed change to the contractor business systems regime.  The proposed rule would amend the Defense Federal Acquisition Regulation Supplement (DFARS) by replacing the phrase “significant deficiency” with the new defined term “material weakness,” to mean “a deficiency or combination of deficiencies in the internal control over information in contractor business systems, such that there is a reasonable possibil

Another One: It Pays to Consult the DOJ under the Civil Cyber Fraud Initiative

On June 17, 2024, the Department of Justice (DOJ) announced a $11.3 million False Claims Act (FCA) settlement that touches on two key enforcement priorities:  the DOJ’s Civil Cyber-Fraud Initiative and pandemic-related fraud.  This settlement, the largest under the Civil Cyber-Fraud Initiative to date, resolved allegations that Guidehouse Inc. (Guidehouse) and its subcontractor, Nan McKay and Associates (Nan McKay), violated the FCA because they failed to conduct pre‑production cybersecurity tes

Commerciality Guidance for Major Weapon System Procurements

On May 30, 2024, the Department of Defense (DoD) issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement Section 803 of the 2023 National Defense Authorization Act, which modified 10 U.S.C. § 3455 to provide additional guidance regarding data requirements needed to support determinations of commerciality and price reasonableness under procurements for major weapon systems.  The rule applies to products that (i) have not previously been deemed comme

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