Gordon Rees Scully Mansukhani announces the latest update from the firm's Government Contracts practice group, bringing you an overview of recent notable decisions, rule updates, amendments, and other critical information related to contracting with federal and state governments. Our team compiled the most pertinent legal developments in the ever-evolving landscape of government contracts to keep you informed. Please contact Patrick Burns or Meredith Thielbahr for further information regarding the cases and administrative actions highlighted below.
Recent Cases:
HEALTHeSTATE, LLC v. United States, No. 18-cv-34C, 2023 WL 8705595 (Fed. Cl. Nov. 20, 2023)
- In this Contracts Disputes Act ("CDA") claim, the Court of Federal Claims ("COFC") granted a dismissal due to the contractor-plaintiff’s failure to include a sum certain in its certified claim. Providing clarity to a decision on the same issue earlier in the year, the court held that a sum certain is not a jurisdictional prerequisite. Rather, it is an essential element of a CDA claim. The distinction is important. An agency may waive a procedural defense if it is asserted too late in the proceeding. Whereas, jurisdictional prerequisites cannot be waived. Here, the government raised the issue for the first time in its answer, which the court found to be timely. Accordingly, the court held that the government did not waive the defense, dismissing the matter.
Togiak Mgmt. Servs., LLC v. United States, No. 23-1728, 2023 WL 8707721 (Fed. Cl. Dec. 7, 2023)
- In this protest action, the U.S. Army Corps of Engineers denied the plaintiff-contractor’s bid due to its failure to submit a bond form containing wet signatures. The form at issue was a photocopy containing electronic signatures. COFC disagreed with the agency, holding that the determinative factor is whether the bond is enforceable, not whether the surety’s signature is original or a copy. In rendering its opinion, the court determined that a Government Accountability Office ("GAO") decision principally relied on by the government (TJ's Marine Construction, LLC, B-402227, 2010 CPD ¶ 19 (January 7, 2010)), was irrational and inconsistent with prior GAO decisions.
Inner City Contracting, LLC v. Charter Twp. of Northville, Michigan, 87 F.4th 743 (6th Cir. 2023)
- The plaintiff-contractor in this matter sued a township and its consulting company, alleging racial discrimination following the township’s contract award to another business. The lawsuit claimed violations of constitutional rights, federal statutes, and Michigan law. The U.S. District Court for the Eastern District of Michigan dismissed the matter in its entirety, principally due to lack of Article III standing. To satisfy the standing requirement, a plaintiff needs to allege a provable harm traceable to the conduct of the defendant.
- The U.S. Court of Appeals for the Sixth Circuit Court reversed in part, finding the plaintiff had Article III standing. The court held the plaintiff sufficiently alleged an injury traceable to the defendants’ conduct, including dignitary harm from racial discrimination and financial harm from the lost profits.
Proposed Agency Rules:
SBA – Small Business Size Standards: Revised Size Standards Methodology
- The Small Business Administration ("SBA") updated its white paper on establishing, reviewing, and modifying small business size standards. The revised methodology is open for public comments until February 9, 2024.
- The white paper, titled "SBA's Size Standards Methodology (December 2023)," is available on the SBA website and www.regulations.gov. Contact the GRSM Government Contracts practice group for additional details and comment submission.
DoD: Cybersecurity Maturity Model Certification Program
- The Department of Defense ("DoD") proposes requirements for a comprehensive assessment mechanism under the Cybersecurity Maturity Model Certification Program.
- The proposed rule aims to ensure defense contractors implement the necessary security measures, including new requirements for Controlled Unclassified Information and Federal Contract Information.
- The comment submission deadline is February 26, 2024. Contact the GRSM Government Contracts practice group for additional details of the proposed rule and comment submission.
Forthcoming Agency Rules:
DoD, GSA, NASA Federal Acquisition Regulation: Use of Project Labor Agreements for Federal Construction Projects
- This final rule modifies Federal Acquisition Regulation Subpart 22.5, concerning the use of project labor agreements ("PLAs"). This rule incorporates Executive Order 14063, generally mandating PLAs for federal construction projects exceeding a value of $35 million. Certain exceptions apply depending on the nature of the project.
- This rule will go into effect on January 22, 2024.
GRSM Government Contracts Practice Group
GRSM's government contracts team has considerable experience defending and enforcing the rights of our contractor clients in disputes against government entities and private businesses. In addition to litigating claims in state and federal courts, we routinely handle matters before administrative tribunals, such as the Government Accountability Office, the Small Business Administration, and the Armed Services Board of Contract Appeals.
Our team of attorneys is located throughout the United States, which allows the firm to represent contractors, regardless of size, and in a wide variety of industries, including defense, information technology, construction, and aerospace, among others. Please contact the authors with any questions. GRSM would like to acknowledge the significant contributions to this update by Quyen Dang.
Contacts:
Patrick Burns - pburns@grsm.com
Meredith Thielbahr - mthielbahr@grsm.com
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