Government Contracts Legal Forum

Living in Harmony: Notable Changes to Synchronize the 8(a) and Small Business Mentor-Protégé Programs

Posted in Small Business
Amy Laderberg O'SullivanOlivia LynchElizabeth Buehler

In this second part of our blog series about the July 25, 2016 SBA final rule implementing numerous changes to multiple SBA regulations and establishing a new small business Mentor-Protégé Program (SB MPP), we address how such implementation impacts the parallel 8(a) Business Development mentor-protégé program (8(a) MPP).  As the final rule points out, the 8(a) MPP will remain intact; however, the SBA has made several changes to the regulations governing that program, which largely represent the SBA’s efforts to harmonize the two programs.  The paragraphs below discuss some of these changes, including those impacting the requirements for entry, ongoing reviews and terminations, and reporting obligations.

Requirements for Entry into the 8(a) MPP

With the creation of the SB MPP, companies qualifying as an 8(a) have the option to participate in either the 8(a) or the SB MPP. Any current or future participant in the 8(a) MPP should be aware of the final rules’ numerous changes to this program, as discussed below. Continue Reading

SBA Opens the Floodgates: The Mentor-Protégé Program Expands to All Small Businesses

Posted in Small Business
Amy Laderberg O'SullivanOlivia LynchElizabeth Buehler

On July 25, 2016, the SBA published its final rule establishing a government-wide mentor-protégé program for the benefit of all small businesses as protégés.  This widely-anticipated rule, implementing provisions of the Small Business Jobs Act of 2010 and the National Defense Authorization Act for Fiscal Year 2013, provides increased opportunity for small and large businesses to partner with one another.  Effective August 24, 2016, this new program is expected to unleash a flood of new mentor-protégé agreements (MPAs) as well as joint ventures eligible to compete on set-aside procurements, and it could likely result in an increase in the number of set-aside procurements.

Below we discuss the benefits from participating in this program, the requirements for the mentor-protégé agreement (“MPA”), the eligibility criteria for mentors and protégés, and the requirements for joint ventures established pursuant to the MPAs. Given the numerous benefits to participating in this program, including the opportunity to joint venture, the SBA has layered into this final rule the requirement for numerous express certifications of compliance and severe consequences for violation of the SBA’s regulations, MPAs, and/or joint venture agreements.  A separate blog post will address the changes that the SBA is implementing in the final rule to the SBA’s current regulations governing the 8(a) business development (BD) program.

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Significant Developments for Contractors in the Twilight of the Obama Administration

Posted in GSA Schedule/Commercial Items, Labor & Employment, Legal Developments
Angela B. Styles

The final year of the Obama Administration has seen a flurry of activity that will affect the government contracting community.  Appearing on WJLA’s Government Matters program (available here at govtmatters.tv), Crowell & Moring Chair Angela Styles discussed some of the latest changes that will impact industry including the GSA’s final rule on transactional data reporting; the Office of Federal Procurement Policy’s category management initiatives; and the Fair Pay and Safe Work Places Executive Order.

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The SBA Final Rule Implementing the FY2013 NDAA Part IV: New Recertification Requirement Following Mergers & Acquisitions

Posted in Small Business
Amy Laderberg O'SullivanOlivia LynchJoelle Sires

In this part of our ongoing series (see Part I, Part II and Part III) on the Small Business Government Contracting and National Defense Authorization Act of 2013 Amendments implementing the National Defense Authorization Act of 2013 (FY2013 NDAA) Amendments, we address the new recertification requirement that is triggered following the merger, sale, or acquisition of a firm that has submitted an offer as a small business concern (SBC).

A concern that represents itself as a small business and qualifies as small at the time of proposal submission is considered to be a small business throughout the life of that contract.  This even applies for Multiple Award Contracts—the SBC is considered small for each order issued against the contract with the same NAICS code and size standard (unless a contracting officer chooses to request a new size certification in connection with a particular order).  In other words, even where a concern grows to be other than small, the procuring agency may exercise options and still count the award as an award to a SBC, unless a recertification requirement has been triggered.

Given the great boon that comes to a firm upon award of a contract where it has qualified as a SBC, the SBA has long sought to set the right balance for what should happen when a small business is involved in a merger, sale, or acquisition. The concern is that if a SBC could submit a proposal with pricing, certify that it is small, and actually qualify on that date of proposal submission as small, should that small business be able to sell itself following proposal submission or contract award to a large business and allow the large business to benefit for up to five years of contract performance as a “small business”?  The SBA’s answer to that is no.  The SBA’s regulations as currently drafted require recertification in certain circumstances following a merger, sale, or acquisition but only once award has already been made.  In the final rule, SBA imposes new recertification requirements aimed at changes that occur within the window between proposal submission and contract award.

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Supreme Court Recognizes Implied Certification Theory of FCA Liability

Posted in False Claims
Robert RhoadBrian Tully McLaughlinJason M. CrawfordSarah Hill

In a decision that will impact Government contractors, health care providers and all institutions that accept federal dollars, the U.S. Supreme Court this past week offered a qualified affirmation of the validity of the implied certification theory of False Claims Act liability. In Universal Health Servs. v. U.S. ex rel. Escobar, the Court unanimously held that a defendant may be liable under the FCA when, in connection with a claim for payment submitted to the government, the defendant “makes specific representations about the goods or services provided” and fails to disclose noncompliance with material statutory, regulatory, or contractual requirements that makes the representations “misleading half-truths.”

In a “Feature Comment” published in The Government Contractor, C&M attorneys analyze the Court’s opinion, the legal and factual context in which it arose, and its likely effect on federal government contractors

Crowell & Moring Held Its Annual OOPS Conference

Posted in Events
Amy Laderberg O'Sullivan

The Government Contracts Group, along with our colleagues from the Corporate, White Collar, Litigation, and Labor & Employment Groups along with several guest speakers, presented on a broad range of current issues impacting government contractors during our annual OOPS and West Coast OOPS.  Our practitioners covered hot topics such as the new labor and employment reporting and disclosure requirements, agency assessments of supply chain, and cyber security.  We also provided guidance on how to navigate traditionally challenging areas for contractors, such as protection of intellectual property and data rights, classified contracting, and cost accounting.  All of the presentations can be found using the links below.

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The SBA Final Rule Implementing the FY2013 NDAA Part III: What You Need to Know About Affiliation and Joint Ventures

Posted in Small Business
Amy Laderberg O'SullivanOlivia Lynch

As we have previously addressed, the Small Business Administration’s (SBA) final rule, Small Business Government Contracting and National Defense Authorization Act of 2013 Amendments, has implemented numerous changes to small business contracting contained in the National Defense Authorization Act of 2013 (FY2013 NDAA).  Below we discuss an important change to one affiliation test as well as newly introduced exclusions from affiliation.  On the whole, these changes make it easier for small businesses to work together without risking a finding of affiliation.

Affiliation is a central component of SBA’s regulations: in determining a concern’s size, SBA counts the receipts, employees, or other measure of size of the concern whose size is at issue and all of its affiliates (domestic and foreign).  In other words, these tests and (and exemptions or exclusions) affect whether SBA finds a concern to be small or other than small based on its relationships with other concerns.

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Rethinking Government Contracts Crisis Management: Do Your Mandatory Disclosures (or Lack Thereof) Increase Enforcement Crisis Risk?

Posted in False Claims
David B. RobbinsPeter J. Eyre

To disclose or not to disclose-that is not the only question.

The Mandatory Disclosure Rule can be challenging for government contractors to work with, and common methods of analyzing disclosure obligations cause contractors to miss potentially significant risks to their enterprise. The requirement to timely disclose credible evidence of a Federal criminal law involving fraud, conflict of interests, bribery or gratuity violations, violations of the civil False Claims Act, or significant overpayments on federal government contracts can be challenging to interpret.  The terms “timely disclose,” “credible evidence,” and “significant overpayments” are not defined in the rule, and no authoritative guidance is available about their meaning or their interpretations.  As a result, contractors spend significant time and money assessing whether – and when – a disclosure is required, and then crafting their disclosures to help explain their analysis.

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The SBA Final Rule Implementing the FY2013 NDAA Part II: The Changes to Small Business Subcontracting Plans Have Immediate Impacts on Small and Large Businesses

Posted in Small Business
Olivia LynchAmy Laderberg O'Sullivan

The Small Business Administration’s (SBA) final rule, Small Business Government Contracting and National Defense Authorization Act of 2013 Amendments, implements changes regarding small business subcontracting plans contained in the National Defense Authorization Act of 2013 (FY2013 NDAA).  We discuss the key changes below.  This rule becomes effective June 30, 2016, but as some of the changes impact the proposal process which can involve planning and team selection months in advance of proposal submission, contractors need to focus on the new requirements now.

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The SBA Final Rule Implementing the FY2013 NDAA Part I: SBA Overhauls the Method for Calculating Compliance with the Limitation on Subcontracting Requirement

Posted in Small Business
Olivia LynchAmy Laderberg O'Sullivan

The goal of the limitation on subcontracting requirement is to ensure that a certain amount of work is performed by a small business concern (SBC) when it qualifies for a small business program set-aside or sole source procurement due to its socioeconomic program status. SBA’s final rule, Small Business Government Contracting and National Defense Authorization Act of 2013 Amendments, implements numerous changes to this requirement contained in the National Defense Authorization Act of 2013 (FY2013 NDAA).  This rule becomes effective June 30, 2016. However, changes to the parallel FAR requirements are still needed for regulatory consistency and implementation.

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