On November 5, 2018, the Federal Circuit held in a precedential decision that bonding requirements in FAR 52.228-15, “Performance and Payment Bonds—Construction,” were read into all construction contracts by operation of law at the time of award, pursuant to the Christian doctrine.  FAR 52.228-15 requires an offeror in any construction contract valued over $150,000 to furnish performance and payment bonds:

Performance and Payment Bonds—Construction (OCT 2010)

(b) Amount of required bonds. Unless the resulting contract price is $150,000 or less, the successful offeror shall furnish performance and payment bonds to the Contracting Officer as follows:

(1) Performance bonds (Standard Form 25). The penal amount of performance bonds at the time of contract award shall be 100 percent of the original contract price.
(2) Payment Bonds (Standard Form 25-A). The penal amount of payment bonds at the time of contract award shall be 100 percent of the original contract price.

Continue Reading The <i>Christian</i> Doctrine Strikes Again … To Require Performance and Payment Bonds in all Construction Contracts

Veteran-owned small businesses have long faced inconsistencies between the regulations of the Small Business Administration (SBA) and those of the Department of Veterans Affairs (VA). For example, these inconsistencies can lead to companies qualifying as a Service-Disabled Veteran-Owned Small Business (SDVOSB) under VA standards yet but not SBA standards—or vice versa. This issue came to a head recently at the U.S. Court of Federal Claims (COFC) in Veterans Contracting Group, Inc. v. United States.

In a decision issued on December 15 and made public on December 21, the COFC restored a company’s ability to pursue contracts set aside for small businesses owned by disabled veterans by the VA. The decision came a day after the COFC reluctantly backed the SBA’s determination that the same company did not qualify for set-aside contracts under its rules. These conflicting decisions show the struggle the COFC and contractors face when dealing with inconsistent small business rules from two agencies.

Continue Reading COFC Decision Foreshadows VA Proposed Rule on Service-Disabled Veteran-Owned Small Business Eligibility Rules

The U.S. Court of Federal Claims recently issued a 2017 statistical report—covering the government’s fiscal year October 1, 2016 to September 30, 2017. During this time, 652 suits filed were filed at the Court and 1,035 suits disposed of within the 12 month period. Of the suits filed, over 42% were contract dispute or protest related, almost 15% taking cases, and 8% tax related. With the overall disposal rate of cases increasing by 82% over the previous year, the Court had its most productive year out the past 12 years. Plaintiffs seeking relief at the Court received around $1.3 billion in judgments and settlements—a nearly $500 million increase from 2016 and the largest amount since 2007. The government, on the other hand, was awarded only $4.3 million in counterclaims, sanctions or offsets.

Continue Reading U.S. Court of Federal Claims Reports on Busy and Productive FY17

DHS Technologies LLC and subsidiary DHS Systems LLC recently agreed to pay $1.9 million to settle claims it defrauded the federal government by failing to disclose that it offered greater discounts to a commercial company as part of the renewal of its General Services Administration (GSA) Federal Supply Schedule contract in 2007.

Sharon McKinney, a former employee-turned-whistleblower, initiated the lawsuit under the qui tam provision of the False Claims Act. The contract was part of the GSA’s Multiple Award Schedule program that allows the government to order commonly used products and services from a list of approved vendors. These vendors are required to provide the government with complete and accurate information about prices charged to commercial customers to enable the agency to obtain the same or better pricing. Specifically, McKinney alleged that DHS Technologies failed to inform GSA of its lower prices for emergency mobile shelters offered to its largest commercial customer, Northrop Grumman. DHS’ failure to provide this complete information led to the overpayment, by the government, for these mobile shelters from 2007 thru 2013.

The defendant companies, based in Orangeburg, N.Y., did not admit wrongdoing in the settlement. As part of the settlement, McKinney will receive 19% of all payments obtained by the government.

The DOJ press release on the DHS Technologies settlement can be found here.