In latest edition of The Weekly Wright Report:
- New Law Requires the Federal Government To Update The Rules Regarding Organizational Conflicts of Interest – read now
- WCS Featured Attorney Spotlight: Edward L. Healy IV – read now
New Law Requires the Federal Government To Update The Rules Regarding Organizational Conflicts of Interest
On December 27, 2022, President Biden signed the Preventing Organizational Conflicts of Interest in Federal Acquisition Act (P.L. 117-324). As the name states, the purpose of the Act is to prevent organizational conflicts of interest in federal acquisition. An Organizational Conflict of Interest (OCI) is typically defined as because of other activities or relationships with other persons, a person is unable or potentially unable to render impartial assistance or advice to the Government, or the person’s objectivity in performing the contract work is or might be otherwise impaired, or a person has an unfair competitive advantage. OCI looks at the institution and everyone in it, as well as any possible or actual conflicts. A regular conflict of interest, only looks at individuals. Three types of OCI that can arise include:
- Biased Ground Rules: A company has in some sense set the ground rules for the competition for another Government contract by writing the Statement of Work (SOW) or the specification such that it could skew the competition in favor of itself.
- Unequal Access to Information: A company has access to nonpublic information as part of its performance of a government contract and where that information may provide the company an unfair competitive advantage in a later competition for a Government contract.
- Impaired Objectivity: A company’s work under one government contract could entail its evaluating itself or a related entity, either through an assessment of performance under another contract or an evaluation of proposals.
In general, the new law provides that within 18 months, the Federal Acquisition Regulatory Council must revise the Federal Acquisition Regulation to provide and update (A) definitions related to specific types of organizational conflicts of interest, including unequal access to information, impaired objectivity, and biased ground rules; (B) definitions, guidance, and illustrative examples related to relationships of contractors with public, private, domestic, and foreign entities that may cause contract support to be subject to potential organizational conflicts of interest, including undue influence; and (C) illustrative examples of situations related to the potential organizational conflicts of interest. One example of such a conflict identified in the Act is the awarding by a federal regulatory agency of a contract for consulting services to a contractor if employees of the contractor performing work under such contract are permitted by the contractor to simultaneously perform work under a contract for a private sector client under the regulatory purview of such agency.
The Act further requires the FAR Council to provide solicitation provisions and contract clauses to avoid or mitigate organizational conflicts of interest and which require contractors to disclose information relevant to potential organizational conflicts of interest and limit future contracting with respect to potential conflicts of interest. Finally, the Act also requires executive agencies to establish or update agency conflict of interest procedures to implement the new FAR rules made under the Act. Stay tuned on this issue as the FAR Council will be issuing proposed rules on this issue over the next 18 months. It is impossible to predict whether these new rules will merely tweak the system or provide for whole-sale changes, but all federal contractors must stay updated and informed on these potential changes.
If you have any questions about this issue, please contact any member of our Government Contracts practice group.
WCS FEATURED ATTORNEY SPOTLIGHT: EDWARD L. HEALY IV
This week’s WCS Featured Attorney Spotlight features Edward L. Healy IV. Mr. Healy recently served as a judicial clerk to the Honorable Nancy M. Purpura in the Circuit Court for Baltimore County. As an associate at the WCS Baltimore office, he works with a variety of clients on complex legal matters.
What/Who was your inspiration to pursue law school/legal career?
I can’t tell you how many of my college friends ask about how I handle “complex legal matters.” Basketball was my first love, and I wanted to continue working in sports, so I decided to attend law school to study Sports Law.
When it comes to your practice, what types of case/matters come across your desk most often?
Litigation, often employment related, matters come across my desk most often but I handle plenty of transactional or drafting matters as well.
Have you handled matters that aren’t in your typical practice wheelhouse?
Yes, I’ve gotten to work with almost every partner in the firm and touch many of the different substantive areas of law they practice.
Are you involved in any associations, clubs, community organizations or nonprofits you are passionate about?
I currently serve as mentor at Innovation Works for the next generation of Baltimore entrepreneurs.
Is there a little known fact about you – something people may not know?
I earned a Super Bowl ring as a member of the Baltimore Ravens scouting department during the 2012 season. I also served as the Head Boys’ Varsity Basketball Coach at Cristo Rey Jesuit High School in Baltimore from 2015-2017. I also have rekindled an old childhood hobby, collecting sports cards and attending card shows.