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On March 23, 2020, the President signed an “Executive Order on Preventing Hoarding of Health and Medical Resources to Respond to the Spread of COVID-19” delegating additional authorities under the Defense Production Act of 1950 (“DPA”), which builds on Executive Order (EO) No. 13909, issued March 18, 2020, which we discussed here. The new EO delegated to the Secretary of Health and Human Services (“HHS”) the authority to prevent hoarding of health and medical resources necessary to respond to the spread of COVID-19 by: (1) prescribing conditions for accumulation of such resources; and (2) designating any material as scarce or threatened by excessive accumulation as to reasonable business, personal, or home consumption, or for purpose of resale at excessive prices (i.e., price gouging). These designations, in turn, trigger the prohibitions against hoarding. The EO also delegated the authority to gather information, such as information about how supplies of such resources are distributed throughout the nation, through use of investigations, records, reports, and subpoenas. The DPA and its implementing regulations and orders carry criminal penalties for noncompliance, as well as the possibility of injunctive relief in certain circumstances.

Subsequently, HHS issued a notice, effective March 25, designating fifteen materials as “scarce materials or threatened materials,” including items such as N-95 and other filtering facepiece respirators, ventilators, disinfecting devices, and a variety of health-related personal protective equipment (“PPE”). Under the notice, the term “materials” includes raw materials (including critical components), products, and items of supply; and any technical information or services ancillary to the use of any such materials, commodities, articles, components, products, or items. The term “scarce materials or threatened materials” means health or medical resources, or any of their essential components, determined by the Secretary to be needed to respond to the spread of COVID-19 and which are, or are likely to be, in short supply or the supply of which would be threatened by hoarding. Designated scarce materials or threatened materials are subject to periodic review by the Secretary. The designation self-terminates in 120 days unless superseded by a subsequent notice.

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Photo of Jonathan M. Baker Jonathan M. Baker

Jonathan M. Baker is a partner in Crowell & Moring’s Washington, D.C. office. He practices in the Government Contracts Group.

Jon advises clients on a wide array of government contracts legal issues, including both federal and state bid protests, prime-sub disputes, government contracts…

Jonathan M. Baker is a partner in Crowell & Moring’s Washington, D.C. office. He practices in the Government Contracts Group.

Jon advises clients on a wide array of government contracts legal issues, including both federal and state bid protests, prime-sub disputes, government contracts due diligence and transactions, regulatory compliance, and contract terminations. Jon’s practice has a notable emphasis on technology-related issues, including counseling clients in the areas of patent and data rights, responding to government challenges to technical data and computer software rights assertions, and litigating cases involving complex and cutting edge technologies. Jon also provides guidance on national security matters, such as National Industrial Security Program Operating Manual compliance and facility and security clearance matters. In addition, Jon has advised clients on local government contract negotiation, internal and government investigations regarding potential False Claims Act issues, and export violations. Jon is also actively involved in the firm’s pro bono program, having litigated prisoner neglect, parental rights termination, and landlord-tenant matters.

Photo of Troy A. Barsky Troy A. Barsky

Troy Barsky is a partner in Crowell & Moring’s Washington, D.C. office, and serves as a member of the firm’s Health Care Group Steering Committee where he focuses on health care fraud and abuse, and Medicare and Medicaid law and policy. Troy counsels…

Troy Barsky is a partner in Crowell & Moring’s Washington, D.C. office, and serves as a member of the firm’s Health Care Group Steering Committee where he focuses on health care fraud and abuse, and Medicare and Medicaid law and policy. Troy counsels all types of health care entities, including hospitals, group practices, and health plans on the physician self-referral law (Stark Law) and the Anti-Kickback Statute, innovative healthcare delivery models, such as Accountable Care Organizations (ACOs), and Medicare & Medicaid payment and coverage policy. He also defends clients seeking resolution of government health care program overpayment issues or fraud and abuse matters through self-disclosures and negotiated settlements with the U.S. Department of Justice, U.S. Health & Human Services Office of the Inspector General and the Centers for Medicare & Medicaid Services (CMS).

Photo of Alan W. H. Gourley Alan W. H. Gourley

Alan W. H. Gourley is a partner in the Washington, D.C. office of the law firm of Crowell & Moring and serves as a member of the Steering Committee for the firm’s Government Contracts Group. He graduated magna cum laude from Beloit College…

Alan W. H. Gourley is a partner in the Washington, D.C. office of the law firm of Crowell & Moring and serves as a member of the Steering Committee for the firm’s Government Contracts Group. He graduated magna cum laude from Beloit College in 1977 and from the University of Virginia School of Law in 1981. He is a member of the District of Columbia bar.

Photo of J. Chris Haile J. Chris Haile

J. Chris Haile is a partner at Crowell & Moring with extensive experience in government procurement law. Mr. Haile litigates disputes and counsels clients in a broad range of government contract matters, with particular emphasis on the resolution of contract disputes. For example…

J. Chris Haile is a partner at Crowell & Moring with extensive experience in government procurement law. Mr. Haile litigates disputes and counsels clients in a broad range of government contract matters, with particular emphasis on the resolution of contract disputes. For example, Mr. Haile has represented clients in matters involving the government’s breach of contract, claims for contract changes, termination for default, termination for convenience, Truth in Negotiations Act (TINA) compliance and defective pricing, commercial-item procurement, contract negotiations, and bid protests. He also represents clients in other related matters, such as investigations and audits by government agencies or inspectors general (IGs), False Claims Act / qui tam relator suits, and disclosures to the U.S. Government.

Photo of John E. McCarthy Jr. John E. McCarthy Jr.

John E. McCarthy, Jr. is a partner in the Washington, D.C. office of Crowell & Moring and member of the firm’s Government Contracts Group. John has spent more than thirty years litigating all forms of government contracts cases for both large and small…

John E. McCarthy, Jr. is a partner in the Washington, D.C. office of Crowell & Moring and member of the firm’s Government Contracts Group. John has spent more than thirty years litigating all forms of government contracts cases for both large and small government contractors, with a particular emphasis on bid protests. Because of John’s strong engineering background, he has particular experience in technology related issues, including litigation regarding complex technology and data rights, patent and other intellectual property issues.

Photo of Stephanie Crawford Stephanie Crawford

Stephanie L. Crawford is a counsel in Crowell & Moring’s Washington, D.C. office, practicing in the Government Contracts group.

Stephanie’s practice focuses on mergers and acquisitions, contract and regulatory compliance reviews, and counseling on supply chain, sourcing, and national security issues. Her practice…

Stephanie L. Crawford is a counsel in Crowell & Moring’s Washington, D.C. office, practicing in the Government Contracts group.

Stephanie’s practice focuses on mergers and acquisitions, contract and regulatory compliance reviews, and counseling on supply chain, sourcing, and national security issues. Her practice supports clients in the aerospace & defense, communications, energy, information technology, and consumer products sectors.