False Claims Act

BLOG: Buyer Beware: More Stringent Standards for Government Contractors under the Buy American Act on the Horizon

October 4, 2019
By Jacqueline K. Unger
President Trump has made "buy American and hire American" a key goal for his administration. To that end, the President has signed three executive orders to impose stricter enforcement of the Buy American Act (BAA), the latest of which was issued on July 15, 2019. While this new Executive Order on Maximizing Use of American-Made Goods, Products, and Materials (the Executive Order) does not have any immediate effect on federal procurements, it proposes significant changes to the Buy American requirements, and government contractors would be wise to keep abreast of the changes which could be implemented as soon as the spring of 2020.
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BLOG: Small Businesses and the FCA: Are More FCA Cases Against Small Businesses on the Horizon?

September 19, 2019
By Timothy F. Valley
On August 20, 2019, the U.S. Department of Justice announced that it had reached a $20 million settlement with Luke Hillier (Hillier), the majority owner and former CEO of a Virginia-based defense contractor, ADS, Inc. (ADS), to resolve "allegations that he violated the False Claims Act (FCA) by fraudulently obtaining federal set-aside contracts reserved for small businesses that his company was ineligible to receive . . . ." The resolution of the claims against Hillier follows ADS's payment of a separate $16 million settlement on related claims, as well as an additional $225,000 paid by Charles Salle, the former general counsel of ADS, to resolve claims arising from his role in the alleged scheme. Combined, the $36 million total settlement is believed to be the largest FCA recovery in history based on allegations of small business contracting fraud. Given the size of the collective settlement and the nature of the allegations against Hillier and ADS, small businesses everywhere—particularly government contractors—should anticipate a potential increase in the frequency of small business fraud-related FCA cases.
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BLOG: Building Compliance: Construction Industry Concerns Under FCA

August 28, 2019
By Sarah L. Nash
The Department of Justice (DOJ) has settled and obtained judgments in excess of $2.8 billion for false claims against the government last year. Over $2.1 billion of these cases arose from lawsuits filed under the qui tam provisions of the False Claims Act (FCA) which incentivizes whistleblowers to file claims. Government contractors in the construction industry – both primes and subs – face a higher risk of FCA liability because of the complicated nature of construction contracts and prevailing wage obligations. Below we discuss the top FCA issues facing construction contractors and protection strategies for avoiding them.
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BLOG: Cybersecurity Meets the FCA: What the Chinese Telecom Ban Means for Government Contractors

August 27, 2019
By Peter B. Ford and Anna R. Wright
Government contractors are required to comply with a new set of prohibitions on telecommunications equipment acquired from certain Chinese companies, and they may face False Claims Act liability since the prohibitions require certification that they have not used prohibited products. These prohibitions come from the John S. McCain National Defense Authorization Act for Fiscal Year 2019,* which contains a number of provisions intended to keep U.S. government funds from moving to Chinese government-owned corporations. Section 889 in particular lists companies the Chinese government owns that are now prohibited sources of supply for telecommunications equipment. Effective August 13, 2019, these prohibitions are incorporated into the FAR in Subpart 4.21.
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BLOG: Have the Flood Gates Opened?: Cisco Settles First-Of-Its-Kind Cybersecurity False Claims Act Litigation

August 2, 2019
By Matthew E. Feinberg
On July 31, 2019, a False Claims Act matter pending in the United States District Court for the Western District of New York was unsealed, revealing an $8.6 million dollar settlement that may have far-reaching implications on government contractors. The litigation, United States, et al., ex rel. James Glenn v. Cisco Systems, Inc., was initiated in 2011 on behalf of the federal government and a number of state governments, after a Denmark-based employee of a Cisco affiliate was terminated allegedly for reporting a flaw in one of Cisco's video surveillance products. With the rapidly developing role of cybersecurity in federal procurements, government contractors should clearly understand their obligations, representations, and certifications to avoid False Claims Act liability and ensure compliance.
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