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Government Contracts
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June 18, 2013
No New Trial Over KDH Body Armor Contract Fight
A North Carolina federal judge on Tuesday refused to grant Eagle Industries Unlimited Inc. a new trial, finding that instructions were proper and evidence sufficient enough for a jury to force Eagle to pay KDH Defense Systems Inc. for body armor panels allegedly contracted by the U.S. Marine Corps.
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June 18, 2013
Reps. Label CMS Evasive, Push Bill To Delay Competitive Bids
A bipartisan duo of House lawmakers Tuesday sharply escalated their campaign to halt expansion of a competitive bidding program for purchases of durable medical equipment, labeling Medicare’s top official “evasive” and introducing legislation to force a delay while alternatives are explored.
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June 18, 2013
KBR Tells Fed. Circ. CFC Erred In Denying $12.5M Cost Award
KBR Inc. on Monday urged the Federal Circuit to reverse a ruling which denied it the full $12.5 million in costs it allegedly incurred in connection with an Iraq War food service contract, arguing the trial court didn’t apply a proper reasonableness standard to evaluating costs.
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June 18, 2013
Polsinelli Lures 10 Attys From Husch Blackwell
Polsinelli PC recently scooped up 10 attorneys from Husch Blackwell LLP, additions that expand its government contracts practice in Washington, D.C., grow its toxic tort practice in St. Louis and create a Tennessee office that includes attorneys focused on real estate law and intellectual property issues in large transactions.
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June 18, 2013
Cancer Testing Co. Blasts False Claims Suit As 'Speculation'
Cancer diagnostic company Caris Life Sciences Inc. told a Texas federal court Monday that allegations that it overbilled Medicare and gave hospitals kickbacks were based on "mistaken assumptions and speculation" from former employees who couldn't possibly have known about any false claims.
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June 18, 2013
GSA's Tangherlini Breezes Through Confirmation Hearing
Daniel Tangherlini, nominated to lead the U.S. General Services Administration after 14 months as its acting administrator, breezed through his Senate confirmation hearing Tuesday, earning praise for his ongoing efforts to reform the agency and deftly handling questions about recent reports of contract mismanagement.
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June 18, 2013
GOP Lawmakers Blast DOL's Prevailing Wage Calculations
Republican members of a U.S. congressional subcommittee on Tuesday assailed the U.S. Department of Labor's methods for determining prevailing wage rates for public works projects under the Davis-Bacon Act and suggested that the agency may need to overhaul its data collection process.
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June 17, 2013
OIG Report Faults DHS' Tracking Of Cybersecurity Training
The Department of Homeland Security does not sufficiently ensure that cybersecurity contractor personnel receive adequate security training, according to an inspector general report released Thursday.
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June 17, 2013
United Technologies Hit With $473M False Claims Judgment
An Ohio federal judge on Monday hit United Technologies Corp. with a $473 million judgment after finding it to have misled the U.S. Air Force in a jet engine contract bidding war during the 1980s and 90s, concluding a 14-year-old False Claims Act suit.
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June 17, 2013
Textron Says Missing Army Inventory Not A False Claim
A Textron Inc. unit urged a Louisiana federal judge Friday to put an end to a whistleblower's allegations that the company lost armored vehicle spare parts from a warehouse it kept for a U.S. Army contract, arguing that the government didn't lose any money.
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June 17, 2013
Ex-GSA Manager Cops To Meddling With Contracting Probe
A former property manager for the U.S. General Services Administration pled guilty Friday to charges that he interfered with an internal probe into allegations that he retaliated against a maintenance contractor over a personal grudge.
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June 17, 2013
US Broke Water Contract, Calif. District Tells Fed. Circ.
A California water district on Thursday urged the Federal Circuit to reverse a lower court’s decision finding the U.S. wasn’t contractually obligated to provide drainage services to its irrigated lands, arguing various contracts indeed require the government to provide irrigation water and drainage to the district.
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June 14, 2013
Army Cancels $1.8B Contract For New Carbines
The U.S. Army on Thursday said it has canceled a $1.8 billion contract for a new carbine that would replace the M4 rifle, saying none of the six rifles offered was enough of an improvement to justify the cost.
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June 14, 2013
GAO Rejects Beechcraft's Protest Of Air Force Contract
The U.S. Government Accountability Office on Thursday rejected Beechcraft Corp.’s protest of a contract worth up to $950 million to build light air support planes for the Afghan military that was awarded to a joint venture led by Sierra Nevada Corp.
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June 14, 2013
House Passes $638B Defense Bill With Sex-Assault Crackdown
The House of Representatives on Friday passed a $638 billion defense policy bill, adding a new mandatory two-year prison sentence for military sexual assault convictions.
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June 14, 2013
Hong Kong Co. Snags Rights To $40B Nicaragua Canal Project
Nicaraguan legislators passed a special law Thursday to jump-start a massive $40 billion canal project that will allow large ships to pass through and also granted a Hong Kong company exclusive rights to develop the project, according to two statements.
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June 14, 2013
Novartis Can't Duck Elidel FCA Suit, But Kickback Claims Cut
A Pennsylvania federal judge on Thursday refused to dismiss a former Novartis Pharmaceuticals Corp. employee's whistleblower lawsuit, which accuses the drugmaker of ripping off Medicaid by promoting off-label uses of eczema treatment Elidel, but stripped anti-kickback claims from the suit.
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June 14, 2013
Medicare Contractor Improperly Paid Out $11M, HHS Reports
Medicare contractor Palmetto GBA LLC inadvertently overpaid hospitals $10.8 million for patient care, believing they had discharged the patients to their homes rather than skilled nursing facilities or other post-acute care treatments, according to a U.S. Department Health and Human Services report released Friday.
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June 14, 2013
GAO Reopens CIA Cloud Computing Bidding After IBM Protest
The Central Intelligence Agency shouldn't have given a $600 million cloud computing contract to Amazon.com Inc. because it didn't treat all bidders equally, the U.S. Government Accountability Office said in a decision released Friday granting an IBM Corp. bid protest.
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June 13, 2013
Extradition Of NSA Leaker Is Far From Slam Dunk For US
With the prospect of extradition looming for the former Booz Allen Hamilton employee who admitted leaking details of the National Security Agency's secret surveillance of phone records and Internet activities, experts say he will probably try to limit America’s reach by casting any charge as politically motivated, among other strategies.
Expert Analysis
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4th Circ. Could Guide Courts On Constitutional FCA Fines
At oral argument in Bunk v. Gosselin World Wide Moving, a Fourth Circuit panel focused on what number should be analyzed to evaluate the constitutionality of a fine under the False Claims Act and what is the right remedy if a court determines that a fine is constitutionally excessive. The decision will have the potential to greatly affect the amount that FCA defendants who successfully raise constitutional objections will have to pay, say attorneys with Ropes & Gray LLP.
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Takeaways From Largest Drug Safety Settlement
The recent $500 million settlement of Ranbaxy USA Inc., the largest drug safety-related settlement with a generic manufacturer to date, has broad implications for U.S. Department of Justice and Food and Drug Administration enforcement trends. However, significant questions exist regarding the basis for False Claims Act liability, say attorneys with Skadden Arps Slate Meagher & Flom LLP.
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A Stark Reality For Fair Market Value
Under cases involving health care organizations and their Stark Law violations, the government has enforced actions and settlements ranging from $10 million to nearly $40 million in the first half of 2013. These cases highlight a new effort toward Stark Law violations and ultimately, a change in the way organizations should approach fair market value issues, say attorneys with Krieg DeVault LLP.
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Contracting In A Perfect Storm Of Enforcement Risk: Part 2
Traditionally, contractors have viewed various aspects of responsibility — responding to investigations, developing ethics programs, interfacing with the customer, etc. — as entirely separate silo practices. In recent years, however, such a piecemeal approach to legal risk management has been shown to be startlingly ineffective, say attorneys with Covington & Burling LLP.
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Intelligence Leak Places Spotlight On Classified Programs
The recent leak of sensitive information by an employee of a major government contractor highlights how vulnerable every contractor is to the actions of a single employee. All contractors performing classified work should use this event as a lesson learned and proactively evaluate their internal systems, say Todd Canni and Marques Peterson of McKenna Long & Aldridge LLP.
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Gov't Missteps Have Created Leverage For Corporations
Seventeen high-profile federal cases over the past four years may provide corporations with greater leverage in negotiating resolutions to federal criminal investigations. The significant missteps by government prosecutors may have undermined the way in which judges view the government, say attorneys with Paul Hastings LLP.
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1st Circ. Ruling Highlights Split On FCA First-To-File Bar
The First Circuit's decision in Heineman-Guta v. Guidant Corp. follows a prior decision from the D.C. Circuit — rejecting contrary authority from the Sixth Circuit — and demonstrates a growing trend favoring an interpretation of the first-to-file bar that is grounded in the text of the False Claims Act, encourages prompt reporting of alleged fraud through first-filed actions, and protects defendants from costly copycat suits, say attorneys with McKenna Long & Aldridge LLP.
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Mediators, Expand Your Tool Kit In Complex Litigation
The resolution of class actions or multidistrict litigation cases can present a number of challenges that call for the utmost in the mediator's skill and understanding. Though there is no typical complex litigation case, a mediator needs to recognize the special levels of complexity in these cases, such as litigating against "repeat players" and handling "follow-on" cases, says James Rosenbaum of JAMS.
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Lessons From Fox Insurance's Multitude Of Mistakes
In Fox Insurance Co. Inc. v. Centers for Medicare & Medicaid Services, the Ninth Circuit displayed a strong deference to CMS in its first-ever exercise of its authority to terminate immediately its contract with a Part D plan sponsor and set a high bar for a challenge to a termination to be successful, says David Kopans of Squire Sanders LLP.
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FRCP Amendments Could Change Discovery As We Know It
On June 3, the federal judiciary’s Committee on Rules of Practice and Procedure approved for publication proposals to limit the scope of discovery under the Federal Rules of Civil Procedure. The proposed amendments appear well targeted to aggressively rein in a discovery process that many believe has gotten out of control in too many cases, say attorneys with Reed Smith LLP.