GOVERNMENT CONTRACTS
Keys to Avoiding GAO’s Timeliness Trap, PilieroMazza Blog, Isaias “Cy” Alba, IV, Eric Valle
GAO’s recent decision in Marathon Medical Corporation provides a cautionary tale for government contractors seeking to protest the terms by which an agency conducts a procurement. Specifically, Marathon reinforces a little-known rule: the Government Accountability Office considers an agency’s receipt of proposals to be adverse agency action in response to an agency level protest challenging the terms of a solicitation, and the ten-day rule for filing a subsequent protest at GAO begins running from the date on which the agency received proposals. Contractors must be aware of this timeliness trap, which has significant implications for where and when a protester should challenge a solicitation. In this blog, PilieroMazza offers government contractors keys to avoiding GAO’s timeliness trap. Read more here.
What DOD’s Final DFARS Rule Means for Defense Contractors, American Manufacturing, and Protecting the Nation’s Supply Chain, PilieroMazzza Blog, Jacqueline K. Unger
On February 15, 2024, the Department of Defense (DOD) issued a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement Executive Order (EO) 14005, Ensuring the Future Is Made in All of America by All of America’s Workers, and strengthen Buy American Act (BAA) domestic preferences in DOD procurements. In this blog, PilieroMazza explains the final rule’s implications for defense contractors in the manufacturing sector and safeguarding the defense industry’s supply chain. Read more here.
Federal Judge Orders Minority Business Development Agency to Serve All Business Owners Regardless of Race, PilieroMazza Blog, Isaias “Cy” Alba, IV, Emily A. Reid
On March 5, 2024, a federal judge ordered the Department of Commerce’s Minority Business Development Agency (MBDA) to immediately stop considering a business owner’s race or ethnicity in determining whether an applicant may receive business-related benefits and services from MBDA Business Centers nationwide, including assistance with accessing capital and pursuing government contracting opportunities.[1] Judge Mark T. Pittman, U.S. District Judge for the Northern District of Texas, ruled that MBDA’s use of the presumption that certain individuals—including African Americans, Latinos, American Indians or Alaska Natives, Asians, and Native Hawaiians or other Pacific Islanders—are “socially or economically disadvantaged individuals” is unconstitutional. Government contractors should be aware of these developments as the decision could impact current and future programs focused on increasing the participation of historically underrepresented groups in the federal marketplace. In this blog, PilieroMazza breaks down the case, Jeffrey Nuiziard, et al. v. Minority Business Development Agency, et al., and its potential impact on minority-owned businesses. Read more here.
Small Business Administration (SBA) Interim Final Rule: Providing Discretion to Extend Women-Owned Small Business (WOSB) Program Recertification
On March 7, SBA published an Interim Final Rule amending the WOSB program regulations to extend the date of WOSB recertification where appropriate. The Interim Final Rule is available here and is effective as of March 7, 2024. Comments close May 6, 2024.
Department of Defense (DOD) Final Rule: Defense Industrial Base (DIB) Cybersecurity (CS) Activities
On March 12, DOD published a Final Rule finalizing revisions to the eligibility criteria for the voluntary DIB CS Program. These revisions allow all defense contractors who own or operate an unclassified information system that processes, stores, or transmits covered defense information to benefit from bilateral information sharing. DOD is also finalizing changes to definitions and some technical corrections for readability. The Final Rule is available here and will be effective April 11, 2024.
Government Accountability Office (GAO) Report: Defense Contracting, DOD Should Encourage Greater Use of Existing Expertise to Review Indemnification Requests
On March 7, GAO released a report about the Department of Defense’s (DOD) challenges negotiating contractor requests for indemnification. GAO found that indemnification requests were rare and mostly approved. GAO recommended DOD encourage contracting officials to use its insurance review team to help evaluate requests. The full report is available here.
Upcoming IT Contract Puts Spotlight on Small Vendor Procurement, Bloomberg Government
More than 1600 questions submitted following NASA’s release of a draft request for proposals for the $20 billion Solutions for Enterprise-Wide Procurement VI vehicle indicate continuing strong industry interest in the 10-year contract. However, contract requirements could hurt small vendor competitiveness. Small business federal contractor level fell 33% since FY14. Read more here (subscription required).
US Small-Business Optimism Decreases to a Nine-Month Low, Bloomberg News
US small-business optimism slipped to a nine-month low in February as high prices and borrowing costs took a toll on expansion plans, according to the National Federation of Independent Business. NFIB’s sentiment index slipped 0.5 points in February to 89.4. Capital spending plans ease, fewer say now is a good time to expand. Read more here (subscription required).
Upcoming Government Contracts Presentations
WEBINAR: Legal Strategies & Capture Planning, Isaias “Cy” Alba, IV, March 15, 2024. Read more here.
TRAINING: Legal Considerations When Supporting OCONUS Contracts, Isaias “Cy” Alba, IV, March 19, 2024. Read more here.
WEBINAR: Mergers & Acquisitions in Government Contracting: Novations and Recertification, Abigail “Abby” L. Baker, Cole R. Fox, March 20, 2024. Read more here.
WEBINAR: FAR Part 17: Special Contracting Methods, Isaias “Cy” Alba, IV, March 22, 2024. Read more here.
WEBINAR: Unlocking the Secrets of Debriefings, Government Evaluation of Proposals and Protests, Katherine B. Burrows, Eric Valle, March 28, 2024. Read more here.
NATIVE AMERICAN LAW & TRIBAL ADVOCACY
SBA’s 8(a) Program Again Challenged and the Potential Impacts on Native Owned Entities, PilieroMazza Blog, Antonio R. Franco, Isaias “Cy” Alba, IV, Emily A. Reid
The Small Business Administration’s (SBA) 8(a) Business Development Program (8(a) program) faced new constitutionality challenges in a case filed at the U.S. Court of Federal Claims (COFC) by Advanced Simulation Technology Inc. (ASTi). ASTi protested a contract awarded to an Alaska Native Corporation (ANC) alleging, among other things, that the entire tribal 8(a) program is unconstitutional. While this case will likely be dismissed for reasons wholly unrelated to the constitutionality challenge, these allegations are sure to be raised again by other firms looking to challenge awards to tribally owned, ANC, or Native Hawaiian Organization (NHO)-owned entities. This is merely a continuation of the current challenges to the constitutionality of the 8(a) program starting with the Ultima case PilieroMazza reported on last year (linked here and here). As noted, this new challenge to the 8(a) Program could potentially affect contract awards to entity-owned 8(a) participants, such as tribally owned firms and ANCs. Read more here.
Clocking in with PilieroMazza: #RES2024: New Workforce Updates for Tribally Owned Entities in Government Contracting, PilieroMazza Podcast, Nichole D. Atallah and Sarah L. Nash. Click here to listen to the podcast.
CONSTRUCTION
Fla. Judge Relieves Insurer of $1M Construction Defect Row, Law360
An insurer has no obligation to defend or indemnify a general contractor or subcontractor in an over $1 million faulty construction dispute, a Florida federal judge ruled, finding that the subcontractor’s policies contained an unambiguous “residential construction” exclusion that clearly barred coverage. Read more here (subscription required). The Order is available here.
CORPORATE & ORGANIZATIONAL GOVERNANCE
Focus on S Corporations, Part 3: Tax Implications and Special Considerations in S Corp Acquisitions, PilieroMazza Blog, Abigail “Abby” L. Baker, Paul H. Tracy
Acquiring a business can be a strategic move to grow, diversify, or compete in the market. Acquisition also involves significant tax implications that can affect the value and structure of the deal. Therefore, it is crucial for buyers and sellers to understand the tax consequences of different types of acquisitions and plan accordingly. In Part 3 of PilieroMazza’s blog series “Focus on S Corporations,” we highlight key elements of an S Corp acquisition that buyers and sellers should address to improve tax outcomes and business continuity. Visit this link for Part 1 and this link for Part 2 in the blog series. Read more here.
SEC Beefs up Disclosure Rules for Stock Order Executions, Law360
The U.S. Securities and Exchange Commission unanimously agreed Wednesday to require market venues and brokers to increase disclosures showing that they are obtaining the best prices for their customers’ stock market orders on a timely basis, marking the first update to such rules in a quarter-century. Read more here (subscription required).
US Appeals Corporate Transparency Act Ruling to 11th Circ., Law360
The U.S. Department of the Treasury is moving quickly to appeal an Alabama federal judge’s ruling that the Corporate Transparency Act is unconstitutional, filing a notice of appeal to the Eleventh Circuit on Monday. Read more here (subscription required). The Notice of Appeal is available here.
BUSINESS & TRANSACTIONS / LABOR & EMPLOYMENT
Employee Retention Credit: Moratorium, Withdrawals, and March 22 Deadline for Voluntary Disclosure Program, PilieroMazza Client Alert, Abigail “Abby” L. Baker, Sarah L. Nash, Paul H. Tracy
The Employee Retention Credit (ERC)—sometimes called the Employee Retention Tax Credit or ERTC—is a refundable tax credit for certain eligible businesses and tax-exempt organizations that had employees and were affected during the COVID-19 pandemic. Amid growing concerns about aggressive marketing and scams involving fraudulent activity, the Internal Revenue Service (IRS) has announced several initiatives aimed at helping small businesses concerned about an ineligible ERC claim. In this client alert, PilieroMazza summarizes key points of the ERC and important considerations to help small businesses avoid an audit or a criminal investigation. Businesses that received the credit but don’t meet the ERC rules should consider applying for the ERC Voluntary Disclosure Program before the March 22 deadline. Read more here.
FALSE CLAIMS ACT
PilieroMazza Annual Review: What DOJ’s Annual FCA Report Means for Government Contractors, PilieroMazza Webinar Replay, Matthew E. Feinberg, Jacqueline K. Unger. Click here to view the recorded session.
Valeant Ruling May Pave Way for Patent-Based FCA Suits, Law360
In Silbersher v. Valeant Pharmaceuticals International Inc., a generic-drug maker challenged the validity of Valeant’s patent before the Patent Trial and Appeal Board and won, with a finding that Valeant got the patent by knowingly misleading the patent examiner. Read more here (subscription required).
LABOR & EMPLOYMENT
Executive Office of the President Executive Order (EO) 14119: Registered Apprenticeships and Labor-Management Forums, Expansion and Promotion Efforts for Use in Industries and Federal Government
On March 11, the Executive Office of the President published EO 14119 to promote and expand Registered Apprenticeships programs modernizing and broadening avenues to Federal jobs and improving access to opportunities for underserved workers. The EO is available here.
Biden’s $14B DOL Budget Addresses Child Labor, Paid Leave, Law360
President Joe Biden unveiled his annual budget proposal Monday for fiscal year 2025, and it would set aside billions of dollars for the U.S. Department of Labor to address worker protections and establish a paid leave program. Read more here (subscription required). The Budget Proposal is available here.
Biden Proposes 2% Raise for Feds in 2025 Budget, Government Executive
Following multiple years of multi-decade record pay increases, the White House cited “fiscal constraints” facing agencies to justify smaller raises next year. Read more here.
Upcoming Labor & Employment Presentations
CONFERENCE: Panel: A Focus on Legal Policy, Nichole D. Atallah, March 14, 2024. Read more here.
PM WEBINAR: New Wave of Pay Transparency Requirements Affects Employers and Federal Contractors, Sarah L. Nash, Sara N. Strosser, April 4, 2024. Read more here.
WEBINAR: From Compliance to Competitiveness: Revamped DBA Rule Reshapes Labor Landscape for Construction Contractors, Nichole D. Atallah, Sarah L. Nash, April 5, 2024. Reach more here.
SEMINAR: What’s the Latest on CMMC, Nichole D. Atallah, Daniel Figuenick, III, April 8, 2024. Reach more here.
CYBERSECURITY & DATA PRIVACY
Biden Calls for More Cybersecurity Funding Across Agencies, Law360
The Biden administration on Monday pushed Congress to make significant monetary investments in efforts to bolster the federal government’s cybersecurity posture, including by earmarking $13 billion to support initiatives across civilian agencies and devoting additional funding to help the U.S. Department of Health and Human Services combat a growing scourge of cyberattacks on healthcare providers. Read more here (subscription required). The Budget Proposal is available here.
Biden’s $1.67 Trillion Budget Boosts Tech, AI, Government Executive
The Biden administration’s FY2025 budget request provides agencies with $3 billion “to responsibly develop, test, procure and integrate transformative AI applications across the federal government.” Read more here.
How the Procurement Process Can Help Agencies Acquire Responsible AI, Government Executive
Buying artificial intelligence is not just about setting new policies to manage emerging technology, but applying tried-and-true processes, one expert says. Read more here.
