Chambers and Partners ranks Nichols Liu as an Elite Firm for Government Contracts 2024
Chambers and Partners ranks Nichols Liu as an Elite Firm for Government Contracts 2024. Click Here
Ex-Jenner & Block Partner Jumps To Gov’t Contracts Boutique
Nichols Liu, a boutique government contracts firm based in Washington, D.C., has added a long time Jenner & Block LLP attorney as a partner to continue representing clients in bid protests and a range of government contracts matters.
In an interview with Law360 Pulse, Weiss said she wanted to move her practice to Nichols Liu because its platform was focused on providing excellent service to clients and allowed for meaningful engagement with them. “Nichols Liu is doing something very interesting and refreshing within the government contracts marketplace,” Weiss said.
Robert Nichols, one of the firm’s name partners, told Law360 Pulse that adding Weiss’ practice gives the firm an expert partner to help represent clients taking disputes before the U.S. Government Accountability Office and at other venues. Nichols also noted that he thought Weiss would fit the firm’s dynamic and entrepreneurial platform, which allows lawyers with that mindset to build up their own practices and focus on matters they are interested in. “We’re here to support that growth, not just plunk somebody in as a cog on a bigger machine, “Nichols said. “And that type of ability to design your own path, what would ideally make you happy, we have the flexibility to do that here, and we’re dedicated to supporting that.”
Andy Liu, a name partner at Nichols Liu, told Law360 Pulse in a statement that the firm was looking forward to continuing to expand its capabilities with the addition of attorneys like Weiss.
“We have worked hard to build a platform that features top talent, sophisticated clients, transparent compensation, and a diverse and positive work environment,” Liu said in a statement. “We are happy to be able to attract exceptional lawyers like Carla.”
Nichols told Law360 Pulse that the firm’s attorneys are juggling about a dozen bid protest matters, about four to five False Claims Act litigation cases and also are working on about two or three suspension and disbarment matters. The team also worked on a range of claims cases at various stages, he said. “I think we have the profile that we want: young, aggressive litigators who solve problems,” Nichols said
Nichols Liu Lands Government Contracts Rising Star Carla Weiss.
Washington (May 16, 2024) – Carla Weiss has joined Nichols Liu—a well-regarded boutique Government Contracts law firm in Washington D.C.—as a Partner.
Robert Nichols, Managing Partner of Nichols Liu stated: “Law360 has rightfully identified Carla as a rising star in the government contracts community. Her focus on government contracts litigation adds more bench strength to serve our clients. She also fits well into our cadre of talented, creative, and entrepreneurial professionals.”
Ms. Weiss joins Nichols Liu from the Government Contracts practice at Jenner & Block and, before that, at WilmerHale. She also served as a law clerk to former United States Senator Arlen Specter at the Senate Judiciary Committee, worked at the National Republican Senatorial Committee, and interned with the White House Office of Public Liaison.
Ms. Weiss stated, “I’m thrilled to take my practice to the next level at Nichols Liu. The firm’s combination of sophisticated clients, innovative approaches to client service, and people-focused culture made this move an easy choice for me.” She added, “Nichols Liu has great clients and work. On my first day, I was able to step into a major role on a $60 billion bid protest.”
In addition to leading bid protests, Ms. Weiss’s practice will include representing contractors and subcontractors in claims litigation against the government as well as handling internal investigations for government contractors. She will advise clients on a variety of federal statutes, regulations, and government contract-related compliance matters, including FAR and DFARS interpretation, SBA small business and socioeconomic programs and eligibility, and foreign sourcing requirements.
“We have worked hard to build a platform that features top talent, sophisticated clients, transparent compensation, and a diverse and positive work environment. We are happy to be able to attract exceptional lawyers like Carla,” said Partner Andy Liu.
About Nichols Liu
Nichols Liu LLP is a Chambers-ranked boutique law firm dedicated to serving the needs of government contractors. While Big Law tries to do everything for everybody, Nichols Liu focuses on doing one mission exceptionally well: providing legal services and strategic business advice to government contractors and not-for-profits. The firm has experienced 30% growth over the past year. Clients include 36 of the Top 100 Contractors of the U.S. federal government.
For additional information about Nichols Liu, visit www.nicholsliu.com. For additional information, please contact Robert Nichols at rnichols@nicholsliu.com or at (202) 846-9801.
Recent FEMA Public Assistance Arbitrations & Insights for 2024
By Robert Nichols, Sam Van Kopp, and Logan Kemp
Since the Civilian Board of Contract Appeal’s first arbitration under its modern statutory authority, 42 U.S.C. § 5189a(d), the Board’s interpretation of the Stafford Act, FEMA regulation, and FEMA policy have diverged in subtle but important ways from FEMA’s internal appellate precedent. In 2020, Nichols Liu LLP published a Briefing Paper describing the first year of these critical arbitration decisions. In this update, Nichols Liu LLP examines the most important decisions from 2022, 2023 and the beginning of 2024. Each decision relates to one of six issues that are most commonly disputed before the Board: (1) the adequacy of an Applicant’s documentation of eligible work or costs; (2) the proof needed to demonstrate that damage was the ‘direct’ result of a disaster; (3) the extent of the Board’s deference to FEMA’s interpretations of policy and regulation; (4) the extent of an Applicant’s eligibility for Covid-19 costs; (5) the correct interpretation of FEMA’s 50% rule; and (6) the reasonableness and allowability of costs.
Nichols Liu Lands Choctaw Global’s CEO and Chief Legal Officer
Washington (December 4, 2023) – Sarah Curtis, the former Chief Executive and Legal Officer of Choctaw Global, a tribally-owned family of companies, has joined Nichols Liu as a Partner.
Sarah worked as a government contracts attorney at Holland & Knight and Patton Boggs before leaving to gain in-house experience. She also served as the Vice-President of Legal and Compliance at Choctaw Global as well General Counsel for Olgoonik Corporation, the Alaska Native Corporation for the village of Wainwright, Alaska.
“Sarah brings a wealth of practical knowledge and skills from her in-house positions that will immediately add value for our clients. Her unique, extensive experience with Alaska Native and tribally-owned companies fits well with the firm’s capabilities in M&A and strategic growth,” says Robert Nichols, Chair of the firm.
Sarah’s practice will include advising companies on all aspects of government contracting compliance, corporate governance, mergers and acquisitions, and strategy. She has experience advising companies and individuals on matters involving the Small Business Administration’s 8(a) and other business development programs and issues focused on Alaska Native and tribally-owned companies.
“I’m excited to be returning to Washington D.C., to join the incredible professionals at Nichols Liu and be a part of its growth as it continues serve the government contractor community,” said Ms. Curtis.
Preparing for the Government Shutdown
By Robert Nichols | rnichols@nicholsliu.com | (202) 846-9801
As the government faces yet another shutdown, we want to provide a quick primer on steps to take to prepare.
Why Is the Government About to Shutdown?
The U.S. Constitution and the Anti-Deficiency Act (31 U.S.C. § 1341) prohibit the government from spending money that has not been appropriated by Congress. Congress enacted the most recent appropriations bill in December 2022. That bill funded the government through the next fiscal year. The fiscal year ends on September 30, 2023.
Congress cannot agree on funding levels for the 2024 appropriations bill. Often, when Congress can’t agree on appropriations, they pass a continuing resolution to temporarily funds the government at the previous year’s levels. If Congress doesn’t enact an appropriations bill or a continuing resolution by September 30th, most government operations will cease.
What Happens When the Government Shuts down?
During a government shutdown, agencies suspend all non-essential discretionary functions. Each agency develops its own shutdown plan. These plans delineate which essential services will continue. Generally, services related to public safety—e.g., law enforcement, medical care, border protection—are deemed essential. Federal employees handling essential functions will continue to work. Non-essential employees, however, will stay home.
Absent a stop work order from the contracting officer, federal contractors must continue performance during a shutdown. Performance issues, however, will be inevitable. For starters, payment will likely be delayed. Agencies can’t make payments without appropriated funds. In fact, the federal employees who process payments for any given agency could be furloughed.
In addition to payment delays, contractors should expect performance disruptions. Many federal facilities will close, so contractors won’t have access to the worksite. Also, contractors will not receive approvals for deliverables or timely directions from the agency during a shutdown, which will cause delays.
Moreover during a shutdown, all, procurement activities cease. Agencies will not issue solicitations or award new contracts. You’ll need to sit tight if you’re waiting to hear back on a proposal. Additionally, existing contracts will be in limbo. Agencies will not modify contracts or exercise options during a shutdown.
What Should Contractors Do to Prepare for a Shutdown?
- Review Agency Shutdown Plans – Several agencies have enacted plans that set forth how the agency will operate during a shutdown. The Office of Management and Budget collects them here. Review these plans for agency-specific guidance on contracts.
- Communicate with the Contracting Officer – Reach out to your contracting officers to ask for instructions. Work with them to create a shutdown action plan. An action plan approved by the contracting officer will prevent future headaches.
- Stop Work Only if Necessary – The general rule is, unless the contracting officer directs you to stop work, you must continue—even if payment is delayed. If you find that stopping work is necessary due to government orders or otherwise, contact us to make plans for a claim.
- Create Contingency Plans – If a shutdown occurs, you may need to reassign employees and resources. Create plans internally and with subcontractors and suppliers to make this as seamless as possible.
- Prepare Employees – Communicate with employees about the possibility of paid leave or furloughs. Review and be sure to comply with federal and state employment laws. For instance, the federal Worker Adjustment and Retraining Notification (WARN Act) requires employers to provide 60 days’ written notice in advance of a mass layoff. There is an exception under the WARN Act for “unforeseeable business circumstances.” But it’s not clear a government shutdown qualifies as an unforeseen circumstance.
- Prepare for Claims – Delays in payments or impacted performance may entitle you to an equitable adjustment or give rise to a claim against the government. Track and document the cause of every delay and all increased costs. Losses caused by a shutdown are likely reimbursable. Recovery of these funds will be easier with detailed, well-organized records.
If you have questions about the possible shutdown or need assistance creating a shutdown action plan, Nichols Liu can help. Please contact the author of this article or the Nichols Liu attorney with whom you regularly work.
Federal Contractors Banned from Using TikTok
By Lynne Halbrooks and Madison Plummer
The Interim Rule: On June 2, 2023, the FAR Council issued an interim rule that prohibits having or using TikTok and other covered applications by ByteDance Ltd. on federal contractor devices.[i] This interim rule follows in the wake of the government-wide initiative that bans TikTok on all federal government devices implemented earlier this year due to rising national security concerns and geopolitical tensions between the United States and China. The interim rule amends FAR Part 4, adding new subpart FAR 4.22, “Prohibition on a ByteDance Covered Application,” with a corresponding contract clause at FAR 52.204-27 (the “FAR clause”).
Immediate Implementation: The interim rule is effective immediately. Contracting Officers must include the FAR clause in all solicitations and new awards, including orders, modifications, options, or contract extensions, issued on or after June 2, 2023. Federal contractors should expect amendments to solicitations issued prior to June 2, 2023, no later than July 3, 2023.
Application of the Interim Rule: The FAR clause applies to “the social networking service TikTok or any successor application or service developed or provided by ByteDance Limited or an entity owned by ByteDance Limited.”[ii] Like other prohibitions on covered technology, the FAR clause imposes a broad prohibition on the presence or use of the covered application:
The Contractor is prohibited from having or using a covered application on any information technology owned or managed by the Government, or on any information technology used or provided by the Contractor under this contract, including equipment provided by the Contractor’s employees however, this prohibition does not apply if the Contracting Officer provides written notification to the Contractor that an exception has been granted in accordance with OMB Memorandum M-23-13.
The ban applies to all devices used in the performance of a federal contract, regardless of whether they are owned by the government, the contractor, or the contractor’s employees. The ban includes federal contractor employees’ devices used as part of an employer’s bring your own device (“BYOD”) program, but it does not include (1) personally-owned devices that are not used in the performance of the federal contract or (2) equipment that is incidental to a contract.
A few other notes:
- The interim rule applies to acquisitions at or below the Simplified Acquisition Threshold (“SAT”) and acquisitions for commercial products and services, including Commercially Available Off-the-Shelf (“COTS”) items.
- The FAR clause does not exclude imbedded information technology (e.g., HVAC systems); this differs from the standard definition of “information technology” in FAR 2.101.[iii]
- And again, like other prohibitions surrounding technology, this FAR clause flows down to all subcontracts.
The government does not expect this rule to have a “significant economic impact on business” because the rule is less complex than other prohibitions on technology (e.g., FAR 52.204-25). The government believes that contractors already should have policies and procedures in place that block nefarious technology and that define appropriate technology use for employees. Public comments are being accepted on the interim rule until August 1, 2023.
What’s Next? Although the proposed rule does not include any reporting or record keeping requirements, federal contractors should work incorporate the interim rule into their compliance framework as soon as possible. Steps might include drafting or amending policies to ban the presence and use of TikTok on laptops and cell phones used by employees and subcontractors during contract performance or having your IT staff block employees’ access to the website and installation of the application. Contractors who have a BYOD policy could require certifications from employees and subcontractors that no personal or employee-provided devices use TikTok and verify implementation through endpoint management. Contractors are urged to implement appropriate steps immediately.
As the federal government continues to expand the breadth and depth of prohibited technology used in connection with its information systems, the government contracts industry should consider the possibility that these bans may expand to any system that stores federal information. For example, law firms and accounting firms may become subject to the same prohibition when handling government information provided by their federal contractor-clients in a subpoena response, bid protest, or other litigation.
If you need assistance complying with the new interim rule, have questions, or would like assistance submitting comments to the interim rule, Nichols Liu can help. Please contact the authors of this article or the Nichols Liu attorney with whom you regularly work.
[i] Federal Acquisition Regulation: Prohibition on a ByteDance Covered Application, 88 Fed. Reg. 36430 (June 2, 2023) (to be codified at 48 C.F.R. part 31), https://www.federalregister.gov/documents/2023/06/02/2023-11756/federal-acquisition-regulation-prohibition-on-a-bytedance-covered-application.
[ii] FAR 52.204-27(a).
[iii] Id.
Supreme Court Clarifies Subjective Meaning of “Knowingly” Under the False Claims Act
By Andy Liu, Robert Rhoad, Michael Bhargava, Haaleh Katouzian
On June 1, 2023, the Supreme Court issued a major, but narrow, victory for plaintiffs in False Claims Act cases. It held that defendants can be held liable when they subjectively know that they submit false claims to the government, even if they can later identify an “objectively reasonable” justification for their actions.
The False Claims Act creates liability for those that knowingly submit false or fraudulent claims for payment to the federal government, and it allows private citizens, i.e., “relators,” to initiate “qui tam” suits on behalf of the government and to share in any proceeds recovered through the action. Here, the question before the Supreme Court was how to interpret the word “knowingly,” which has divided lower courts. The disagreement stemmed around whether “knowingly” should be interpreted as a subjective or objective standard.
In the two cases before the Court—United States ex rel. Proctor v. Safeway, Inc. and United States ex rel. Schutte v. SuperValu Inc.—relators separately sued retail drug pharmacy chains operated by SuperValu and Safeway, alleging that they knowingly overcharged Medicare and Medicaid when seeking reimbursement for prescription drugs. Pharmacies are permitted by regulation to charge the government their “usual and customary” drug prices. SuperValu and Safeway interpreted the vague phrase to mean their standard retail price for drugs, even though the large majority of certain drugs were sold at steep discounts. Relators sued on the theory that the pharmacies were knowingly overcharging the government at the retail price, which violated regulations because the discounted price was the “usual and customary” price. To meet the “knowingly” requirement, relators presented evidence showing that 1) the pharmacies had been informed as early as 2006 that they were overcharging for the drugs, and 2) that the pharmacies tried to conceal their approach so as not to raise concerns.
Both the district court and the Seventh Circuit held that the SuperValu and Safeway submitted false claims to the government because, when seeking reimbursement, they should have done so based on their discounted prices. Those courts nevertheless granted summary judgment to the pharmacies, holding that even though they both knew that their requests for payment were fraudulent, the phrase “usual and customary” could have been interpreted by an “objectively reasonable” person as permitting the submission of the higher retail prices. In doing so, the Seventh Circuit adopted an objective standard for interpreting the False Claims Act scienter requirement, unlike the subjective standard adopted by other courts that looked only at what the defendants actually believed.
Last Thursday, the unanimous Supreme Court opinion overturned the Seventh Circuit decisions. It held that the appeals court erred in adopting the objective standard from the Supreme Court’s prior decision in Safeco Insurance Co. of America v. Burr, 551 U. S. 47 (2007), because that case involved a different statute and a different scienter standard (“willfully,” not “knowingly”). The Court noted that the False Claims Act and its roots in common-law fraud standards create liability when a defendant has actual knowledge of the falsity, acts in deliberate ignorance of the falsity, or acts in reckless disregard of the falsity. All of these require an analysis of the defendant’s subjective intent, the Court held. As the Court explained, the False Claims Act and the common law “point to what the defendant thought when submitting the false claim—not what the defendant may have thought after submitting it . . . . As such, the focus is not, as respondents would have it, on post hoc interpretations that might have rendered their claims accurate. It is instead on what the defendant knew when presenting the claim.”
Because the Supreme Court’s decision was narrow and only resolved the broad issue of objective versus subjective intent, lower courts will be left to puzzle through how to implement the Court’s new direction. This includes some language that may prove favorable to defendants. For example, the Court explained that the “reckless disregard” standard—the lowest level of scienter required to establish liability under the False Claims Act—“captures defendants who are conscious of a substantial and unjustifiable risk that their claims are false, but submit the claims anyway.” Because this is a new formulation of the reckless disregard standard, and because this standard is commonly asserted by plaintiffs as it is the easiest to prove, this will almost certainly spawn future litigation battles over what constitutes a “substantial and unjustifiable risk.”
Are Early Protest Dismissals Still Possible? Options After the Federal Circuit’s CACI Decision
by Robert Nichols, Michael Bhargava, Sam Van Kopp
For years, government agencies have sought early dismissal of bid protests at the Court of Federal Claims on jurisdictional grounds, arguing that the protestor was ineligible for award and therefore lacked standing. But the Federal Circuit Court of Appeals just made that more difficult for the government by holding that these arguments are not jurisdictional and must be heard at the merits stage. This holding may draw out bid protests even when protestors appear ineligible for award. But there may also be another way for the government to get such protests dismissed on standing grounds early in the protest process.
The case at issue, CACI, Inc.-Federal v. United States, involved a procurement for a device to encrypt battlefield information. During the proposal stage, CACI disclosed to the Army the existence of a potential organizational conflict of interest (“OCI”) because one of its former employees prepared a document used in the solicitation. The Army did not consider this to be an OCI, but nevertheless rejected CACI’s proposal on technical grounds, and CACI protested at the Court of Federal Claims. In response to the protest, the Army changed its tune and asserted that CACI, in fact, did have a conflict of interest, and it moved to dismiss the protest because CACI was not an “interested party” that would have been eligible for the award. The court refused to consider the Army’s convenient argument, but after conducting its own assessment de novo, it agreed to dismiss the complaint for lack of subject matter jurisdiction based on the lack of standing.
The Federal Circuit reversed the trial court’s decision—and decades of precedent along with it. The appeals court first noted that the relevant standing criteria were established in the Tucker Act, 28 U.S.C. § 1491(b)(1), rather in the “cases and controversies” provision in Article III of the Constitution. The court then looked to the Supreme Court’s decision in Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118 (2014), which held that so-called “statutory standing” (as opposed to “constitutional standing”) is not a jurisdictional issue, but a merits issue that requires courts to determine whether a cause of action encompasses a particular claim. This holding overturns decades of Federal Circuit precedent holding that standing in bid protests was a jurisdictional issue.
The upshot of this decision is that the issue of prejudice––including whether the protestor may have a conflict of interest that makes it ineligible for award––is no longer necessarily a ground for early dismissal in bid protests. Instead, it may be considered alongside the merits of the appeal. CACI may give protestors that might otherwise face an early dismissal an opportunity to develop their claims for consideration on the merits. And if the issue of prejudice is a factual question (such as OCI) that “has not been addressed in the first instance by the contracting officer, a remand is necessary for the contracting officer to address the issue of prejudice.” Id. at *6.
While some commentators view this as the end of early-stage dismissals, we believe there is another possibility: the government may make the same standing argument by filing early summary judgment motions under Rule 56. The court may agree to prioritize this issue and avoid the need for the government to produce agency reports or adjudicate the remaining merits through a motion for judgment on the administrative record under Rule 52.1. To win on Rule 56 summary judgment, the government would have a higher burden of proof, needing to show that there is no genuine dispute of facts as to whether the protestor is eligible for award. But where the facts are not in dispute and the Government can meet this burden, early dismissal may be possible and appropriate, notwithstanding the CACI decision.
On FedNewsNetworks with Tom Temin, Alan Chvotkin discusses significant government contract matters
On February 23, 2023
Nichols Liu partner Alan Chvotkin joined FedNewsNetworks’ Tom Temin for discussion of two significant government contract matters. The first addressed the January 2023 Defense Department policy initiative to expand opportunities for small business. The second covered the December 2022 enactment of legislation governing organizational conflicts of interest in federal procurements. Listen to the full interview
