For years now, we have been documenting the unprecedented surge of anti-corruption enforcement activity by the two regulators charged with enforcing the Foreign Corrupt Practices Act ("FCPA")--the U.S.
Client Alert | July 11, 2011
On June 6, 2011, the Supreme Court in Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc., 563 U.S. ___ (2011), held that the University and Small Business Patent Procedures Act of 1980--popularly known as the Bayh-Dole Act, 35 U.S.C.
Client Alert | June 7, 2011
On May 18, 2011, the Department of Defense (DoD) published an interim rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) and defining the elements of and process for determining the acceptability of six contractor business systems. The interim rule would require Contracting Officers (COs) to withhold a percentage of payments from contracts with DoD contractors that fail to maintain "acceptable business systems." This interim rule took effect on May 18 and applies to solicitations issued on or after that date. It does not require modification of existing contracts, with the exception of Indefinite Delivery/Indefinite Quantity (IDIQ) contracts. The interim rule follows two earlier proposals on the same topic, published on January 15,
Client Alert | May 24, 2011
Washington, D.C. partner Karen Manos is the author of "Know Your Cost Regulations: The Public Relations and Advertising Costs Principal (FAR 31.205-1)" [PDF] published in the May 2011 issue of the Government Contract Costs, Pricing & Accounting Report.
Client Alert | May 1, 2011
On April 26, 2011, the Department of Defense (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA) proposed to substantially amend the Federal Acquisition Regulation (FAR) to provide more comprehensive guidance concerning organizational conflicts of interest (OCI) and contractor access to nonpublic information. The proposed rule comes more than three years after the FAR Councils issued an advanced notice of proposed rulemaking seeking information regarding the need to revise the FAR's OCI provisions, and almost four years after a report issued by the Acquisition Advisory Panel (established by the Services Acquisition Reform Act of 2003) concluded that the FAR does not adequately address OCI. Multiple statutory provisions have als
Client Alert | April 28, 2011
On September 27, 2010, President Obama signed into law the Small Business Jobs and Credit Act of 2010 (Pub. L. No. 111-240). The Act, designed to stimulate the small business sector and create jobs, contains a number of provisions that could have a significant impact on government contractors. The Small Business Administration ("SBA") is holding meetings in 13 U.S.
Client Alert | April 4, 2011
On January 2, 2011, the United States imposed a two-percent excise tax on payments received by foreign entities for the sale of goods or services to the U.S.
Client Alert | March 30, 2011
Washington, D.C. partner Diana Richard spoke at Thomson West's Government Contracts Year In Review on FAPIIS, OCI and Proposed DFARS Rule to Require Withholding of Payments to Contractors for Deficient Business Systems [PDF].
Client Alert | February 25, 2011
While compliance professionals struggle to balance developing, implementing and monitoring effective compliance programs with the reality of shrinking resources and budgets, the risks involved in non-compliance are higher than ever.
Client Alert | January 25, 2011
Printable PDF False Claims Act litigation and enforcement exploded in 2010 with unprecedented intensity. Indeed, the government secured more than $3 billion in civil settlements and judgments for its fiscal year ending September 30, 2010--a 25% increase over the previous year and the second-largest yearly recovery amount ever.
Client Alert | January 6, 2011
The United States Department of Justice ("DOJ") has long had discretion to defer or decline prosecution of a corporation, for a host of reasons. But over the past decade, the formalization of the declination process for corporations via deferred prosecution agreements ("DPAs") and non-prosecution agreements ("NPAs") has evolved rapidly. Indeed, these agreements are now one of two mainstays of the DOJ's efforts to combat corporate crime.
Client Alert | January 4, 2011
Printable PDF"FCPA enforcement is stronger than it's ever been -- and getting stronger." So declared Assistant Attorney General Lanny A.
Client Alert | January 3, 2011
On December 3, 2010, the Department of Defense (DoD) published a proposed rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to require Contracting Officers (COs) to withhold a percentage of payments from all contracts with DoD contractors that fail to maintain "acceptable business systems." This revised proposed rule follows an earlier proposed rule on the same topic published at 75 Fed.
Client Alert | December 7, 2010
On December 3, 2010, a panel of the United States Court of Appeals for the D.C. Circuit vacated a False Claims Act ("FCA") judgment against Science Applications International Corporation ("SAIC") and rejected the government's expansive "collective knowledge" and damages theories under that punitive statute. The D.C. Circuit's decision in this closely watched case represents a sharp rebuke of several of the government's most aggressive theories under the FCA. The case arose out of two contracts under which SAIC agreed to provide technical assistance and expert analysis to the Nuclear Regulatory Commission ("NRC") in connection with a potential NRC rulemaking on the recycling and release of radioactive materials. The NRC te
Client Alert | December 6, 2010
Transparency International (TI) recently released its annual Corruption Perceptions Index (CPI) (available here), spurring a flurry of fanfare in the press about various countries' shifts up and down in the rankings. But it is unclear how much of this attention is warranted. As TI repeatedly acknowledges, the CPI only measures perceptions of corruption, not corruption itself. Further, changes in TI's perceived corruption scores can be misleading--even to the extent they mirror actual corruption--as adjustments in TI's methodology from year to year may move countries up or down the ranking despite no real change in how that country is viewed. Yet TI's CPI remains the benchmark indicator of corruption worldwide. Warranted or not, the rankings attain real signifi
Client Alert | November 16, 2010
Washington, D.C. partner Karen L. Manos is the author of "Contractor Business Systems Audits: The Coming Train Wreck" [PDF] published in the November 2010 issue of Thomson Reuters's Government Contract Cost, Pricing & Accounting Report.
Client Alert | November 9, 2010
Consistent with the past several years, the first half of 2010 brought several Deferred Prosecution Agreements ("DPAs") and Non-Prosecution Agreements ("NPAs"). Although rarely used a decade ago, such agreements now are an important governmental tool in the fight against corporate crime. DPAs and NPAs are agreements between the government and a corporation whereby the government agrees to defer or forgo criminal charges against the corporation in exchange for adherence to the terms of the agreement. The purpose of DPAs and NPAs is to deter, punish, and reform corporate behavior without imposing collateral consequences on corporations and innocent parties such as employees, local community ties, and shareholders. Not surprisingly, the Departmen
Client Alert | August 5, 2010
Many consider the False Claims Act (the "FCA") to be the "fastest growing area of federal litigation." At the outset of the federal government's fiscal year 2010, Senator Charles Grassley (R-Iowa) reported that the government had more than 1,000 qui tam cases awaiting its decision on intervention.
Client Alert | July 9, 2010
On January 18, 2010, hundreds of law enforcement agents from the Federal Bureau of Investigation and City of London Police launched a coordinated, bi-continental strike, executing twenty-one search warrants and arresting twenty-two people in what Assistant Attorney General Lanny Breuer described as "the largest action ever undertaken by the Justice Department against individuals for FCPA violations." Thus began the year in Foreign Corrupt Practices Act enforcement, a juggernaut that each annum surpasses the record heights set the year before. This client update provides an overview of the Foreign Corrupt Practices Act ("FCPA") and a survey of FCPA enforcement activities during the first half of 2010. It also analyzes recent enforcement trends and offer
Client Alert | July 8, 2010
The United States Sentencing Commission voted unanimously on April 7, 2010 to modify the Federal Sentencing Guidelines for organizations, including the provisions that set forth the attributes of an effective compliance and ethics program. After considering a number of proposed changes to these Guidelines, the Commission voted to:Enhance the report obligations from a compliance officer to the board of directors in order for the compliance program to be deemed effective in all circumstances;Clarify the steps a corporation must take to meet the Commission's requirement for proper remediation in the event criminal conduct occurs;Reject the proposed language that would have mentioned, for the first time, the appointment of monitors as a possible component of the remediation requirement o
Client Alert | April 13, 2010
On March 23, 2010, President Obama signed into law the Patient Protection and Affordable Care Act, Pub. L. 111-148, 124 Stat. 119 (PPACA). Media coverage and public scrutiny of this legislation has been extensive, but falling largely outside the spotlight are several provisions extending the reach of the False Claims Act, 31 U.S.C.
Client Alert | April 2, 2010
A final rule issued on March 23, 2010, amends the Federal Acquisition Regulation ("FAR") to implement the Federal Awardee Performance and Integrity Information System ("FAPIIS"). FAPIIS was created to fulfill the requirements imposed by Section 872 of the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 (Pub.
Client Alert | March 24, 2010
Last week, the Department of Defense issued a memorandum implementing the Franken Amendment, a provision of the Defense Appropriations Act for Fiscal Year 2010 restricting the use of certain pre-dispute arbitration provisions by defense contractors.The memorandum prohibits the use of Department of Defense funds appropriated for FY 2010 for any contract awarded after February 17, 2010 in excess of $1 million unless the contractor agrees not to have mandatory pre-dispute arbitration agreements with its employees for disputes under Title VII of the Civil Rights Act of 1964 or claims related to sexual assault or harassment. In addition to agreeing not to include mandatory arbitration clauses on these subjects in new employment contracts, the memorandum requires a contractor to refrain fr
Client Alert | February 24, 2010
In this communication, we discuss the background and history of the so-called "incentive compensation" provision of the Higher Education Act ("HEA"), which is at the core of many of the False Claims Act lawsuits that have been filed against educational institutions.
Client Alert | January 21, 2010
In 2009, the United States government invested trillions of dollars into the economy. Coupled with this unprecedented spending came increased demands for transparency and accountability.
Client Alert | January 8, 2010
Although Deferred Prosecution Agreements ("DPAs") and Non-Prosecution Agreements ("NPAs") were rarely used and hardly discussed a decade ago, in the last several years they have become a hot topic and common aspect of corporate prosecutions: Congress, legal academics, and practitioners—from prosecutors to defense counsel—have weighed in on the Department of Justice's ("DOJ's") use of the agreements. DPAs and NPAs are types of pre-trial agreements whereby the government agrees not to pursue charges against a corporation so long as the corporation abides by the terms of the agreement. Although often similar in content, the emerging difference between a DPA and an NPA is whether a criminal information is filed in a federal court. With
Client Alert | January 7, 2010
"One can say without exaggeration that this past year was probably the most dynamic single year in the more than thirty years since the FCPA was enacted." So began Assistant Attorney General Lanny Breuer in a recent recap of 2009 Foreign Corrupt Practices Act ("FCPA") enforcement. Indeed, for the fourth time in the last five years, the Department of Justice ("DOJ") and Securities and Exchange Commission ("SEC"), the statute's dual enforcers, set a record by bringing more FCPA prosecutions than in any prior year in the FCPA's history. Foreign anti-corruption prosecutions also have reached unprecedented levels. Once an erratic enforcement priority, combating international corruption has now garnered attention at the highest leve
Client Alert | January 4, 2010
Pending legislation could significantly increase the legal risks faced by foreign contractors doing business with the U.S. Government. On March 4, 2009, Senator Claire McCaskill (D-MO) introduced S.
Client Alert | December 21, 2009
The Weapon Systems Acquisition Reform Act of 2009 (WSARA) was signed into law by President Obama on May 22, 2009. Section 207 of WSARA requires the Secretary of Defense to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to "provide uniform guidance and tighten existing requirements for organizational conflicts of interest by contractors in major defense acquisition programs." The Department of Defense (DoD) will likely issue a proposed rule on organizational conflicts of interest (OCI) sometime during the coming months.
Client Alert | December 15, 2009
The U.S.
Client Alert | October 7, 2009
Last year, President Bush signed Executive Order 13,465, requiring federal government contractors to "agree to use an electronic employment eligibility verification system designated by the Secretary of Homeland Security," and the Secretary designated the "E-Verify" system, described in more detail below, for this purpose. The Department of Defense, the General Services Administration, and NASA then jointly issued a final rule to implement the Executive Order, that was to be effective January 15, 2009.On December 23, 2008, however, the U.S.
Client Alert | September 8, 2009
Last week, the Department of Labor published in the Federal Register proposed regulations to implement President Obama's Executive Order requiring that government contracts include provisions regarding employees' unionization rights, that a notice of employees' rights under the federal labor laws be posted by the employer pursuant to those contracts, and authorizing the Secretary of Labor to investigate contractors' compliance with the Order and the accompanying Labor Department regulations. 74 Fed.
Client Alert | August 10, 2009
The frenetic pace of False Claims Act ("FCA") activity in 2008 has continued into the first half of 2009. In addition to record-breaking FCA settlements in several industries, we have witnessed substantial amendments to the federal statute itself.
Client Alert | July 13, 2009
DPAs and NPAs, Too Much of A Good Thing?Although virtually unheard of a decade ago, Deferred Prosecution Agreements ("DPAs") and Non-Prosecution Agreements ("NPAs") are a growing phenomenon in corporate prosecutions. Essentially, DPAs and NPAs are agreements whereby the government agrees not to prosecute a corporation so long as the corporation abides by the terms of the agreement. The key distinction between a DPA and an NPA is whether or not charges are filed against the corporation: with a DPA the government files criminal charges with the court, while with an NPA nothing is filed with the court so long as the corporation completes the terms of the agreement--the agreement is strictly between the government and the corporation.Following the collapse
Client Alert | July 8, 2009
As the inauguration of Barack Obama in January 2009 ushered in a new U.S.
Client Alert | July 7, 2009
Washington, D.C. partner Karen L. Manos testified before the Subcommittee on Government Management, Organization and Procurement hearing titled: “The State of Federal Contracting: Opportunities and Challenges for Strengthening Government Procurement and Acquisition Policies” on June 16, 2009.
Client Alert | June 16, 2009
On May 22, 2009, President Obama signed into law the Weapons Systems Acquisition Reform Act of 2009. The legislation passed unanimously in the House and Senate the previous week. In April, the Government Accountability Office issued a report regarding the Pentagon's weapons systems, which found that 95 major systems exceeded their original budgets by $295 billion and on average were delivered two years late. Obama announced that the new law will crack down on defense programs with huge cost overruns and increase competition for contracts. The new law amends certain sections of Title 10 of the U.S.
Client Alert | May 27, 2009
On May 20, 2009, President Obama signed into law significant changes to the False Claims Act, 31 U.S.C. § 3729 et seq. ("FCA"). The amendments will increase the liability exposure of every company that does business with the federal government and of every company that supplies goods or services that are reimbursed by federal government dollars. This update provides an overview of the changes brought about by the new law, which (among other things), legislatively overturns the Supreme Court's 9-0 ruling last term in Allison Engine Co., Inc.
Client Alert | May 26, 2009
Washington, D.C. partners Joseph D. West, Diana Richard, Karen L. Manos and associate Chrstyne K. Brennan are the authors of "Contractor Business Ethics Compliance Program & Disclosure Requirements" [PDF] published in the April 2009 issue of Thomson Reuters's Briefing Papers.This material from Briefing Papers has been reproduced with the permissions of the publisher, Thomson Reuters. Further use without the permission of the publisher is prohibited.
Client Alert | April 6, 2009
On March 20, 2009, President Obama issued an executive memorandum "Ensuring Responsible Spending of Recovery Act Funds" requiring executive departments and agencies to develop certain selection criteria when committing, obligating or expending funds under the Recovery Act for grants and other forms of federal financial assistance, to monitor compliance with the Recovery Act's prohibition on funding "imprudent" projects and to limit and document communications with registered lobbyists regarding the expenditure of such funds and Recovery Act policy issues.
Client Alert | March 26, 2009
This week President Barack Obama has given a strong indication that--along with a slew of other big ticket items--government procurement reform will be one of his administration's priorities. Though procurement reform was not touted during the campaign and was largely absent from the initial introduction to the administration's agenda, the President and a bipartisan team of senators have championed two changes, in as many days, to the awarding and oversight of government contracts. The legislation has only been proposed and the President has only ordered a review of the procurement process, but the emphasis is likely indicative of more proposals and changes to come. With daily pledges for both additional government spending and renewed fiscal responsibility, the President
Client Alert | March 5, 2009
In January, we provided you with our 2008 Year-End False Claims Act Update in which we discussed, among other things, legislation proposed in Congress in 2007 that would significantly broaden the scope of the False claims Act (the "FCA"). As we predicted, Senator Grassley (R-IA) recently introduced legislation to amend the FCA that, given the current economic environment, Congress is likely to pass. Congress may feel more pressure to pass these bills this session to demonstrate a commitment to protect taxpayer's dollars from fraud, waste, and abuse. First, on February 5, 2009, Senator Grassley introduced the Fraud Enforcement and Recovery Act, S.
Client Alert | February 26, 2009
Last Friday, January 30, President Obama signed three executive orders with important implications for the employment practices of federal government contractors. One concerns reimbursement for activities intended to influence employee decisions about unionization, the second requires employers to post a notice of federal labor law rights and empowers the Secretary to debar federal contractors for noncompliance, and the third requires contractors to offer jobs to employees of a prior contractor in certain circumstances. Together, the orders are among the first of what are expected to be numerous Administration initiatives to strengthen organized labor.The Order titled “Economy in Government Contracting” provides that contractors “shall treat as unallowable” the costs fr
Client Alert | February 2, 2009
Washington, D.C. partner Joseph D. West, Diana G. Richard and associate Christyne K. Brennan are authors of "Postemployment Conflict-of-Interest Restrictions on Former Employees of the Executive Branch" [PDF] published in the February 2009 issue of Thomson-Reuters/West's Briefing Papers.Reprinted with the permission of Thomson-Reuters/West.
Client Alert | February 2, 2009
Congressional oversight of the on-going military actions in Iraq and Afghanistan will move to a new level when the Commission on Wartime Contracting (the "Commission"), also known as the Webb-McCaskill Commission, holds its first public hearing on Monday, February 2nd, 2009. The Commission could become yet another source of scrutiny for some federal government contractors, as well as for future procurement and ethics reforms.
Client Alert | January 29, 2009
I. Introduction Today's headlines are riddled with allegations of fraud and fraudulent schemes--against investors, markets, homeowners, individuals, corporations, and the government.
Client Alert | January 8, 2009
2008 – A Dynamic Year in Corporate Deferred Prosecution AgreementsIn the post-Enron and WorldCom era, the U.S. Department of Justice ("DOJ") often uses corporate deferred prosecution agreements ("DPAs") to resolve federal criminal investigations.
Client Alert | January 6, 2009
The Status of Forces Agreement (SOFA) between the United-States and Iraq was scheduled to take effect on January 1, 2009. Since the SOFA agreement became final on November 28, 2008, contractors operating in Iraq have had numerous questions on how the SOFA will be implemented and what effect it will have on their business operations. One of the primary concerns for U.S.
Client Alert | January 5, 2009
By any measure, 2008 was a monster year in Foreign Corrupt Practices Act ("FCPA") enforcement. With thirty-three enforcement actions between the Department of Justice ("DOJ") and Securities and Exchange Commission ("SEC"), the statute's dual enforcers, 2008 was the second busiest numerical year on the books, trailing only 2007. But beyond the numbers (after all, with the massive Siemens resolution, 2008 dwarfs all other years combined in fines and disgorgement), 2008 saw the FCPA's enforcement regime mature like never before. There were no unimportant FCPA enforcement actions this year. Whether the trend was increasingly aggressive enforcement against individuals, ramped up international coordination, the joining of FCPA prosecutions wi
Client Alert | January 5, 2009
Washington, D.C. partner Karen L. Manos is the author of "Complying With The New Mandatory Disclosure Rule" [PDF] published in the January 2009 issue of Thomson Reuters/West's Government Contract Costs, Pricing & Accounting Report.Reprinted with the permission of Thomson-Reuters/West.
Client Alert | January 1, 2009