May 2016

In Kellogg Brown & Root Services, Inc. v. Murphy, Kellogg Brown & Root Services (KBR) filed a claim with the Army to recover costs associated with a subcontractor’s work on a dining facility in Iraq. The Army denied the claim and KBR appealed to the Armed Services Board of Contract Appeals (the Board). On the Army’s motion, the Board dismissed the claim, finding the six-year statute of limitations under the Contracts Dispute Act (CDA) had expired. KBR appealed to the Federal Circuit, which reversed the Board’s decision, finding the claim did not accrue, and thus the limitations period did not begin to run, until KBR had a basis for a “sum certain” to “fix” its liability.

Under a cost-plus-award-fee contract with the Army, KBR subcontracted work to the joint venture of KCPC/Morris. KBR later terminated the subcontract for delay and KCPC/Morris stopped work on September 12, 2003. On January 24, 2005, after KCPC/Morris had filed suit against KBR, the parties entered into a settlement agreement that liquidated a portion of KCPC/Morris’ claim. On the remainder of the claim, the parties agreed to cooperate to submit an invoice to the government.Continue Reading Federal Circuit Clarifies “Accrual” of Claims under Contract Disputes Act

On May 11, 2016, the Defense Security Service (DSS) released a new guide on mitigating and managing affiliate operations for entities bound by a Foreign Ownership, Control, or Influence (FOCI) mitigation agreement. The guide, titled Navigating the Affiliated Operations Plan: A Guide for Industry, outlines how companies can identify whether they are engaging in affiliated operations, submit an Affiliated Operations Plan (AOP), and ensure that they are properly mitigating potential risks. In compiling an AOP, a company is expected to describe all operations and services it intends to share with affiliates, as well as the potential risks of the collaboration and how those risks will be mitigated. The guide emphasizes that, unless there are special circumstances, an AOP must be provided before a company can start leveraging any affiliated operations.
Continue Reading DSS Releases New Guide to Help Cleared Contractors Meet Requirements of FOCI Mitigation Agreements

The SBA is proposing to change the SBIR and STTR Policy Directives in a series of clarifying amendments that provide a new layer of certainty regarding the future of SBIR contractors’ data rights and potential Phase III awards.

SBIR contractors are currently entitled to an “SBIR/STTR protection period” of four years (five years for DoD SBIR contracts) from the last deliverable during which the awardee retains the rights in data. This protection period is extended upon each subsequent related award, which can leave the contractor and the government (and potential acquiring entities) unsure of the actual length of the protection period. To provide clarity around the time period, SBA is proposing an SBIR/STTR protection period of 12 years without extensions. This is a suggested minimum, and agencies would have the discretion to adopt a longer period. Under a proposed fixed period, the value of a SBIR contractor’s data is more readily determined without an ever-changing timeframe of data rights.Continue Reading How Will Proposed Changes to SBIR Rules Impact Valuation of SBIR Contractors?

We recently authored an article outlining the details surrounding the United States’ eased trade restrictions with Cuba. Businesses must carefully analyze the new regulations before venturing into business opportunities in Cuba.

As stated in the article, “in its zeal to ease restrictions, the U.S. government has not always accounted for how to authorise certain activities…

Preparing a proposal in response to a government solicitation can be a daunting project. It’s not always possible to discern from the solicitation language exactly what the procuring agency wants, and so a certain amount of guessing and hoping is usually involved. However, this process is made doubly more frustrating when it seems that the agency is holding out on you. It is probably unwise for an agency to withhold important information about their procurement, if only for the sake of competition. Even so, there are certain situations where an agency holding back crucial information is a violation of the FAR, and may lead to a successful protest.

This principle was on display in a recent U.S. Government Accountability Office (GAO) bid protest decision, Crowley Logistics, Inc. GAO’s decision in Crowley hinged on the discussions between the procuring agency and the offerors, and whether those discussions were proper. In a negotiated procurement, agencies have the ability to make an award based solely on the proposals initially submitted by offerors. However, the procuring agency also has the option to use the initial proposals to establish a competitive range that includes the offers most likely to receive an award. Once the competitive range is established, the agency then holds discussions with the offerors in the competitive range, allowing those offerors to submit revised proposals in response to the discussions with the agency. If a procuring agency chooses the latter option, the discussions that it holds must be meaningful and equitable across all offerors in the competitive range.Continue Reading Learning from Bid Protests: Procuring Agencies Cannot Hold Out on You

The Department of Energy (DOE) has proposed an amendment to the Department of Energy Acquisition Regulation (DEAR) that, among other changes, clarifies that FAR Subpart 22.12, Nondisplacement of Qualified Workers Under Service Contracts, and the associated Department of Labor regulations, applies to subcontracts under DOE’s management and operating (M&O) contracts. M&O contractors and their subcontractors need to be aware of these changes, particularly the impact on the requirement to hire service employees working on incumbent contracts set forth in contract clause FAR 52.222-17.

FAR Subpart 22.12 implements Executive Order 13495 (January 30, 2009), and requires a successor contractor and its subcontractors to offer “service employees,” as defined by the Service Contract Act, under the predecessor contract (of the same or similar services at the same location) and whose employment will be terminated as a result of the successor contract award, a right of first refusal of employment under the new contract. Employment openings are generally prohibited until such right of refusal has been provided, meaning an incoming contractor will have limited opportunity to staff its current employees on the contract. Importantly, each bona fide express offer of employment must have a stated time limit of not less than 10 days for an employee response, a time period that successor contractors should account for when determining how long it will take to transition the contract. The contract clause, FAR 52.222-17, has to be flowed down to service subcontracts over the simplified acquisition threshold, typically $150,000. The requirements of FAR Subpart 22.12 do not apply to service contracts performed entirely outside the United States. 77 Fed. Reg. 75768 (Dec. 21, 2012).Continue Reading DEAR Department of Energy M&O Contractors: The FAR Nondisplacement of Qualified Workers Requirements Apply To You, Too

Bid protests are a ubiquitous part of government contracting, basically considered part of the normal procurement process. While bid protests can be filed at either the procuring agency level or at the U.S. Court of Federal Claims, the majority of bid protests are filed with the Government Accountability Office (GAO). Recently, on April 15, 2016, GAO released a proposed rule that will make several significant changes to their bid protest process. These proposed changes clarify some elements of the process, while at the same time raise several questions about how these new rules will affect protesters moving forward.
Continue Reading GAO Proposes Significant Changes to its Bid Protest Process

From the Bass, Berry & Sims Blog Network
From the Bass, Berry & Sims Blog Network

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