A recent decision by the U.S. Court of Federal Claims in Bitmanagement Software GMBH vs. The United States determined the United States was not liable for copyright infringement because, based on the interactions between the parties, the Navy was authorized to copy Bitmanagement’s software on 350,000 computers. Bitmanagement is a German company that develops software for rendering three-dimensional graphics and one of their primary products is a three-dimensional renderer named BS Contact Geo.

Background: Floating Software Licenses Led to Copyright Infringement Allegations

In 2006, the Navy was developing a software application called SPIDERS 3D that provides a virtual reality environment for engineers and technicians to view and optimize configurations of Navy installations. During the development of this application, the Navy realized a need for the inclusion of a three-dimensional visualization software within SPIDERS 3D. To fill this need, the Navy procured BS Contact Geo on three separate occasions in 2006, 2008 and 2012 through a software reseller, Planet 9, who Bitmanagement used to market and sell Bitmanagement’s products in the United States.

Continue Reading Software Developer Acquiescence Dooms Bid for Copyright Infringement against Navy

In 2016, the Small Business Administration (SBA) established a new government wide mentor-protégé program for small businesses called the All Small Mentor-Protégé Program (ASMPP). The purpose of the program was for established government contractors to serve as mentors to protégé small businesses by providing business development assistance and to improve the protégé’s ability to successfully compete for federal contracts.

This relationship between the two companies is intended to be mutually beneficial. For protégés, the program creates a framework under which firms obtain valuable technical, management, financial, and contracting assistance from established government contractors. For mentors, one of the benefits was the ability to form a joint venture with their protégé to pursue small business set aside contracts without the two companies being considered affiliated for purposes of SBA’s small business size standards.

Three Findings from SBA’s OIG Review of ASMPP

The SBA’s Office of Inspector General (OIG) reviewed the ASMPP with the objectives of determining whether SBA implemented effective controls to ensure that it conducted initial application reviews and annual evaluations in accordance with the program regulations and if the SBA successfully measured program success.

Continue Reading First Small Business Administration OIG Review of the All Small Mentor-Protégé Program Finds Areas for Improvement

As we noted in a blog post in December 2016, “LPTA Out, Fixed Price Contracts In,” the Department of Defense (DoD) has been moving to restrict the Lowest Price Technically Acceptable (LPTA) evaluation methodology, which requires award to the lowest-price offeror that meets the minimum requirements regardless of whether more expensive solutions are optimal.  Further, in 2016 legislation went into effect requiring that limitations on the use of LPTA evaluations be codified in the Defense Federal Acquisition Regulation Supplement (DFARS).

New Restrictions on LPTA Evaluations

On September 26, 2019, DoD issued a final rule that amends the DFARS to implement that legislation.  The new rule, which was mandated by Section 813 of the National Defense Authorization Act (NDAA) for 2017, as amended by section 822 of the NDAA for 2018, establishes that the LPTA evaluation methodology shall only be used when the following conditions are met: Continue Reading DoD Implements Statutory Restrictions on LPTA Evaluations

A major shift in cybersecurity requirements for Department of Defense (DoD) contractors is about to come into effect—earlier this month the DoD released for public comment the long-anticipated Version 0.4 of the draft Cybersecurity Maturity Model Certification (CMMC). This new framework to safeguarding controlled unclassified information (CUI), which includes a certification requirement by a third-party auditor, presents both significant opportunities and challenges for DoD contractors.

In an overview briefing on the new model, DoD emphasized that the new framework will impose a unified cybersecurity standard for all DoD acquisitions and, in so doing, “reduce exfiltration of [CUI] from the Defense Industrial base.” To achieve this goal, the new model significantly bolsters the existing compliance regime around cybersecurity—which currently, for the most part, requires compliance with the security standards set forth in NIST SP 800-171 through DFARS 252.204-7012.

Continue Reading DoD’s Recently Released Draft Framework Signals Significant Changes in Cybersecurity Requirements

I am looking forward to presenting at ETEBA’s 2019 Business Opportunities & Technical Conference (BOTC) which takes place at the Knoxville Convention Center on October 8-10, 2019. More than 400 participants will gather at the 20th annual BOTC to learn about upcoming opportunities with prime contractors and government procurement officials in the energy, environmental and defense markets, and to build contacts and relationships with key decision-makers, teaming partners, and potential clients.

In addition, there will be technical and training sessions featuring outstanding speakers who will showcase their specialized technical expertise, new and unique technological advances, and project success stories. My session is titled, “Mentor Protégé Joint Ventures – the new ‘Small Business’ Frontier – but only if Done Right!”

Stop by the exhibit hall to visit Bass, Berry & Sims at booth number 121.

For information and registration, please visit the ETEBA website. Let us know if you’ll be there!

  • U.S. government continues to impose sanctions on parties supporting Iran
  • One Cypriot and three Panamanian companies sanctioned for connection to Venezuela
  • European bank fined for prohibited transactions involving Sudan

The U.S. Treasury Department, Office of Foreign Assets Control (OFAC), the main U.S. government body that administers U.S. economic sanctions and embargoes, continues to be busy.  In September 2019 alone, OFAC has announced new sanctions designations, new penalties, and new regulations on a nearly daily basis.

Many of these actions are largely administrative in nature.  For example, in the September 4 Federal Register, OFAC announced new U.S. sanctions on Nicaragua.  While the regulations (at 31 CFR Part 582) are in fact new, the prohibitions contained in the regulations are not: the regulations merely implement Executive Order 13,851, which was issued by President Trump in November 2018.

We nonetheless want to briefly summarize three actions taken by OFAC to date in September 2019.  As described below, we think these actions provide useful insight into how OFAC is operating currently.

Continue Reading Sanctions Update: Additional Iran and Venezuela Designations, Penalty for Sudan Violations

A recent decision in Sotera Defense Solutions, Inc. v. Department of Agriculture, CBCA 6029, 6030, by the United States Civilian Board of Contract Appeals (CBCA), upheld a contract provision that imposed greater obligations on the government than required by the Service Contract Act (SCA). The validity of this contract provision ultimately proved dispositive in the outcome of the case with the CBCA holding the government liable for costs.

In 2012, the National Institutes of Health (NIH) awarded Sotera a contract for the provision of information technology (IT) services. The contract stated that the positions in the contract were exempt from the SCA but advised that a contracting officer would have to determine whether the SCA applied to any positions requested within the task order. The Department of Agriculture (USDA) issued three task orders against the NIH contract to Sotera in which the USDA sought IT operations and maintenance support for offices located throughout the United States.

Continue Reading Equitable Adjustment Appropriate Where Agency Assumed Contractor’s Duty to Identify SCA Positions

I am excited to be presenting a training seminar titled, “Trends and Changes in Federal Contracting FY 20” for the Florida Procurement Technical Assistance Center (Florida PTAC).

The interactive seminar will provide insight into the world of federal government contracting for Fiscal Year 2020 and new initiatives that will impact federal businesses in the next 12 months.

Continue Reading Trends and Changes in Federal Contracting for Fiscal Year 2020

In an article published by Law360, we examined a report issued by the U.S. Department of Defense (DoD) Inspector General on July 23, which summarizes the findings of an audit into the protection of controlled unclassified information (CUI) on contractor networks.

The DoD reviewed nine contractors’ information systems and revealed some deficiencies that do not meet the standards set forth in National Institute of Standards and Technology (NIST) Special Publication 800-171. The exposed deficiencies include: not mitigating vulnerabilities on their networks and systems, not scanning their network for vulnerabilities, not mitigating high vulnerabilities identified in the contractor’s management programs and more.

Continue Reading Findings of DoD Audit and Recommendations for Cyber Enforcement

  • Virtually all transactions with government prohibited
  • Most transactions with private sector parties still permitted
  • Practical challenges make Venezuela transactions difficult, including for non-U.S. parties

On August 5, 2019, President Trump issued Executive Order 13,884 (EO 13,884), which significantly expands existing U.S. sanctions on Venezuela.

Pursuant to EO 13,884, virtually all transactions with the government of Venezuela are now prohibited.  There are some important exceptions to that prohibition, and those are discussed below.

While this is not an absolute embargo on Venezuela, it is quite close.  And even when a transaction with Venezuela may be lawfully permitted, the practical challenges and the risk of conducting the transaction may make it nearly impossible to complete successfully.

Continue Reading Venezuela Update: Significant Sanctions Restrictions Imposed