Comprehensive due diligence review of any target company that performs government contracts should include evaluation of five broad categories relating to general business matters, Kimi Murakami writes in Part II of a report on Piliero Mazza‘s PM Legal Minute blog.

She discusses key issues to be considered when performing due diligence in M&A transactions for government contractors.

The topics include entity formation basics. registrations and permits, employee related matters, intellectual property related matters, and financial and other business related matters.

Read the article.

Read Part I.

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President Trump could soon find himself responsible for appointing a greater share of federal court judges than any first-term president in 40 years, in large part because of a growing number of older judges and a stack of vacancies on the federal courts, according to a report in The New York Times.

Most of the vacant seats are on district courts or appeals courts, explains Josh Katz in the article. Many of those seats have been vacant because of Republican obstruction in blocking votes for former President Obama’s nominees, Democrats charge.

“It’s not just vacancies. The federal bench has many judges who are older than 70,” writes Katz. “Federal judges are appointed for life, but at a certain combination of years served and age, they become eligible to accept ‘senior status,’ a form of semi-retirement.

Read the NYT article.

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Dentons has published the latest edition of its “Government Contracts Legislative and Regulatory Update,” a summary of the relevant changes that took place during January.

Highlights of the report include:

• President Trump orders regulatory freeze pending review
• President Trump’s executive actions and their impacts on the government contracting community
• FAR Council issues final rule prohibiting contracting with firms that require confidentiality agreements restricting disclosure of fraud or abuse

Read the article.

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Healthlaw Publishing announces the upcoming release of Healthcare and the False Claims Act, 2016 Survey. Registration is available now for free downloading of the survey report.

Healthcare and the False Claims Act, 2016 Survey summarizes the important laws, regulations, pronouncements, and cases of the past year, to inform healthcare providers and healthcare attorneys on this crucial statute in the healthcare industry.

On Dec. 14, 2016, the United States Department of Justice announced the recovery of more than $4.7 billion in False Claims Act (“FCA”) settlements and judgments. It was the third-highest total in history, and more than $2.5 billion came from the healthcare industry. During the eight years of the Obama Administration, the Department of Justice recovered more than $31 billion in FCA settlements and judgments, taking more than $19.3 billion from healthcare providers and other participants in the healthcare industry.

2016 was a pivotal year for the FCA. It was the year of a tremendously important Supreme Court decision that could expose healthcare providers to whole new areas of FCA liability based upon state and federal regulations. The penalties were more than doubled to a minimum of more than $11,000 per claim and a maximum of more than $22,000 per claim, massively increasing both the risk of litigation and the likelihood of settling FCA cases even in the absence of wrongdoing. And it saw a new focus on the investigation and even the criminal indictment of individuals involved with entities sued under the FCA. 2016 also saw new regulations and new court interpretations of laws first put in place in 2009 and 2010 to turbocharge the FCA and encourage greater participation by whistleblowers.

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A client alert from Cowan Liebowitz & Latman discusses two recent developments conveying similar messages regarding the need to maintain supporting evidence at both the trademark application and registration stages.

According to the report by William M. Borchard and Vanessa P. Costantini, “if you file an application alleging an intention to use the mark in commerce, you may be required to support that allegation if it is challenged in an opposition, cancellation or infringement proceeding.”

They added that the United States Patent and Trademark Office may now require proof of the actual use of the mark in connection with all of the goods and services listed in the trademark application or registration.

Read the article.

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Navex Global will present a complimentary webinar titled “Managing Workplace Harassment: Trends and Objectives under the New Administration” on Wednesday, Feb. 22. The event will begin at 9 a.m. Pacific time/noon Eastern time.

On its website, Navex says incidents of prejudice and discrimination are increasing in today’s polarized society—including harassment in the workplace. How do you mitigate this risk while tensions continue to flare?

Join this webinar to hear:

• What actions constitute discrimination in the workplace
• How to manage workplace harassment
• Appropriate disciplinary measures

Navex also will share strategies for developing training plans for all levels of employment to minimize and avoid workplace harassment from the top down.

Register for the webinar.

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Some of the  potential benefits of the U.S. House would give companies more incentive to keep jobs in the United States and less to overextend themselves on borrowed money, points out The New York Times.

And there could be big vast savings by reducing what companies spend on tax lawyers, who help them game the current system, writes Neil Irwin.

“Yet these changes could also set off a cascade of more harmful effects. The plan could shift trillions of dollars of wealth from Americans to foreigners; set off an emerging markets financial crisis; wreak havoc in global oil markets; and cause sustained harm to the American higher education and tourism industries (including, as it happens, luxury hotels with President Trump’s name on them),” Irwin writes.

He goes on to discuss effects on the value of the U.S. dollar by the proposed destination-based cash flow tax and its “border adjustment.”

Read the NYT article.

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The only large U.S. law firm in the country dedicated solely to immigration work is in crisis management mode in the wake of President Donald Trump’s immigration order, reports Bloomberg Law.

Blake Chisam, chief audit and privacy officer at Fragomen, Del Rey, Bernsen & Loewy, said the firm has started using two telephone briefings every day to alert partners about administrative issues, news updates, unsettled legal issues and upcoming risks. The firm has about 550 lawyers across the world, many of them gathering information as the situation unfolds.

The report says “Fragomen has helped clients draft letters to their board, briefed upset executives for meetings with the President, and even sued the Trump administration on behalf of a CNN journalist detained at the Atlanta airport. The firm’s attorneys have also jumped in on a pro bono basis to help travelers, visa and green card holders facing deportation and uncertainty.”

Read the Bloomberg article.

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A federal judge blocked the $54 billion merger between health insurance giants Anthem and Cigna, saying the deal would increase prices and reduce competition, according to a report by The Washington Post.

Carolyn Y. Johnson reports that this ruling is the second recent court decision to uphold the Justice Department’s opposition to deals that would have consolidated the five largest insurers in the United States into three companies.

“The evidence has also shown that the merger is likely to result in higher prices, and that it will have other anticompetitive effects: it will eliminate the two firms’ vigorous competition against each other for national accounts, reduce the number of national carriers available to respond to solicitations in the future, and diminish the prospects for innovation in the market,” U.S. District Judge Amy Berman Jackson wrote in a 12-page order.

In the merger agreement, Anthem had agreed to pay Cigna a $1.85 billion termination fee if the deal is blocked because of regulatory interference.

Read the Washington Post article.

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Jeb Hensarling, chairman of the U.S. House Financial Services Committee, outlined proposed legislation to clear away many rules bankers say have hobbled investment and economic growth in a staff memo reported by Reuters.

Hensarling’s plan would roll back Wall Street rules and consumer protections conceived after the 2008 financial crisis, a step that will largely define the financial deregulation debate in the Trump era.

“Under Hensarling’s plan, the largest U.S. banks would face less oversight — though not as little as they had been hoping for – while startups would have easier access to investors,” writes reporter Patrick Rucker.

Read the Reuters article.

Comprehensive due diligence review of any target company is imperative when determining whether to buy another company, writes Kimi Murakami for Piliero Mazza.

“Layer on the fact that the target company has government contracts then several unique issues must also be critically evaluated when performing due diligence. Failure to do so could result in a significant loss in value of the target – and its contracts – after the acquisition has closed. What follows is a list of certain key issues that should be analyzed when engaging in due diligence review of a government contractor,” she explains in an article in the firm’s PM Legal Minute blog.

The article covers subjects such as set-aside contracts, pending proposals, security clearance, import/export issues, oci issues, subcontracts, non-us buyer, and novation.

Read the article.

A Washington lawyer at a prominent firm was arrested in a disguise while trying to sell a copy of a secret lawsuit involving a company that was under investigation by the U.S. Justice Department, Bloomberg Law is reporting.

Jeffrey Wertkin immediately lost his job with Akin Gump Strauss Hauer & Feld LLP after he was picked up Jan. 31 in the lobby of a hotel in Cupertino, California. The FBI said he believed he was about to collect $310,000 for selling the lawsuit.

Wertkin believed he would hand a copy of a complaint to an employee of the company, which was accused in the complaint by a whistle-blower of falsely billing the government, report Bloomberg’s Jef Feeley, David Voreacos and Joel Rosenblatt.

That employee turned out to be an FBI agent, according to arrest documents unsealed on Feb. 6.

Read the Bloomberg article.

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American Banker asks the question of what will be the immediate impact of President Trump’s executive order  calling for a review of financial regulatory policy, especially the 2010 Dodd-Frank Act.

The magazine’s conclusion is that the impact likely will be small in the short term.

In the article, Joe Adler writes that the order was framed as “core principles” rather than any immediate policy change.

“The president has very little direct authority to change Dodd-Frank, repeal the fiduciary duty rule or revamp Fannie Mae and Freddie Mac. As a result, his orders will urge other parts of the government to make changes,” wrote Jaret Seiberg, an analyst at Cowen Group. “With the possible exception of the fiduciary duty rule, actual changes for the banks are unlikely to occur quickly.”

As for the long-term impact, Adler writes that a complete unwind of the 2010 law is unlikely in the current political environment in Washington.

Read the American Banker article.

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Public-interest advocacy groups say the Trump administration appears to be deliberately structuring the president’s growing roster of business-focused advisory groups in order to avoid becoming subject to a federal transparency law that requires such meetings be formally announced in advance and open to the public, reports Politico.

“A 1972 law aimed at limiting back-room influence by special interests, the Federal Advisory Committee Act, regulates the operation of federal government advisory council,” writes Josh Gerstein. “Normally, the meetings of such groups are announced at least ten days in advance in the Federal Register and the sessions are open to the public.”

Although there have been no official notices of any meetings and no executive orders laying out the duties of the “Strategic and Policy Forum” or any other groups Trump is convening, a White House office insisted the meetings are in compliance with the law.

Read the Politico article.

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Uber CEO Travis Kalanick responded to an onslaught of criticism to his joining President Trump’s economic advisory council by resigning from the council on Thursday, reports The New York Times.

The criticism came both from people outside the company and from Uber employees, explains reporter Mike Issac.

First, the company took heat from the public after the company appeared to be profiting from business generated during New York protests of Trump’s immigration order. Then Kalanick had to face direct criticism from his employees, who wondered why he was willing to advise the president.

“Outside of the internal pressure, Uber faced other fallout from Mr. Kalanick’s stance. More than 200,000 customers had deleted their accounts,” Issac writes.

Read the Times article.

U.S. President Donald Trump was set on Friday to fire the opening salvo in his campaign to scale back major regulations that resulted from the financial crisis, directing a review of the Dodd-Frank Act and putting the brakes on a retirement advice rule, Reuters is reporting.

“The executive order Trump will sign on the 2010 Dodd-Frank law on Wall Street reform will be a first step towards rolling back the regulations that Trump sees as hurting the economy, but without rewriting the legislation, which can be done only through Congress,” write Ayesha Rascoe and Sarah N. Lynch. One prominent measure is the ‘Volcker rule’ that greatly restricts how banks can make bets with their own money.”

At a recent meeting with business owners, Trump described the law as “a disaster,” the reporters write.

Read the Reuters article.

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Dykema has added government contracts attorneys John C. Dulske and Bryan Kost to its Government Policy & Practice Group in the firm’s San Antonio office. Prior to joining Dykema, both practiced at Dulske & Gluys in San Antonio, which Dulske formed in 2002.

In his practice, Dulske, who joins the firm as senior counsel, focuses on federal procurement litigation, contract administration and claims litigation, as well as bid protest work, including a mix of administrative and appellate work. He has been actively involved in trial practice in San Antonio and South Texas, with experience in both State and Federal Courts, including the United States Court of Federal Claims in Washington, D.C.

Dulske received his J.D. from St. Mary’s University School of Law, and a B.A. in Economics from Kenyon College.

Kost, who joins the firm as a senior attorney, also focuses his practice on federal procurement litigation, contract administration and bid protest work before the Government Accountability Office, the U.S. Small Business Administration and the United States Court of Federal Claims. He has also maintained an extensive trial practice spanning 24 years in both Texas State and Federal District Courts.

Kost received his J.D. from St. Mary’s University School of Law, and a B.A. in American Studies from the University of Texas at Austin.

“John and Bryan’s vast government contracts experience immediately strengthens our Government Policy Practice,” said Sandi Cotter, Director of Dykema’s Regulated Industries Department and Leader of the firm’s Government Policy & Practice Group. “Their expertise in this important field will greatly benefit Dykema and our clients.”

“We are very excited to add such well-regarded attorneys to our San Antonio office,” said Dan Harkins, Office Managing Member of Dykema’s San Antonio Office.

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Supreme Court nominee Neil Gorsuch, a federal appeals court judge, is expected to face intense scrutiny over the politically incendiary topics of abortion and gun rights during confirmation hearings. However, Dallas media lawyer Shannon Teicher of Jackson Walker LLP suggests that the nominee’s record on the First Amendment is also vitally important given the new administration’s already strained relationship with the press.

In an article posted by Androvett Legal Media and Marketing, Teicher says she is “cautiously optimistic that he would be favorable on free speech issues before the court.”

“There is not a lot of case history involving Judge Gorsuch related to First Amendment issues, but it is important to look at what there is to find,” says Teicher. She points to Bustos v. A&E Networks, a case in which a prison inmate sued for defamation because he only affiliated with a gang but was not a member, as A&E had reported. Serving on the 10th Circuit Appeals Court, Gorsuch ruled that A&E’s statement was substantially true and affirmed dismissal of the lawsuit. In doing so, he explored the historical importance of truth as a defense and called it a “First Amendment imperative.”

However in an earlier decision, “Judge Gorsuch offered an interesting concurrence in Mink v. Knox, in which the court ruled a college student’s parody of a professor was protected speech.” Judge Gorsuch noted the U.S. Supreme Court had not yet ruled on whether parody is actionable when the plaintiff is neither a public figure nor the speech a matter of public concern. He believed “reasonable minds can and do differ” on the issue, so that it was best to avoid such “thickets.

Citing an opinion by then-Judge John Roberts of the D.C. Circuit (now Chief Justice of the Supreme Court), Gorsuch said he would only decide what is necessary and nothing more.

“Such careful parsing may well be a preview of the type of measured approach Judge Gorsuch would take if confirmed to the U.S. Supreme Court,” says Teicher.

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President Trump’s pick to replace the late Antonin Scalia on the U.S. Supreme Court is seen by many on the right as a fitting replacement for the iconic jurist that Gorsuch considered a “lion of the law,” reports The Los Angeles Times.

At the same time, Neil Gorsuch also evokes the qualities of Justice Anthony M. Kennedy, for whom Gorsuch worked as a law clerk, writes reporter David G. Savage.

“He may be more conservative than Kennedy when it comes to expanding individual rights, but he seems to lack Scalia’s fervor for overturning liberal precedents from decades past,” Savage writes.

Read the LA Times article.

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Scholars interviewed by The Washington Post say that President Trump’s executive order on immigration is likely to face a series of new legal challenges about whether it violates a 1965 anti-discrimination law and the Constitution, the newspaper reports.

Four federal judges have put various holds on the ban, and 16 state attorneys general have said they believe the executive order is unconstitutional.

Ruthann Robson, professor of law at City University of New York School of Law, said the order could be thrown out on grounds that it violates the equal protection clause of the Constitution. “She noted that courts have criticized governmental distinctions based on ancestry and race, write Michael Kranish and Robert Barnes.

Read the Washington Post article.

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