By Carol L. O’Riordan
As we see matters now in two of our principal practice areas – government contracts and litigation – we are at a crossroads as the economic stimulus and two overseas wars wind down.
We are approaching the end of the $767 billion American Recovery and Reinvestment Act, passed in 2009 to help bring an end to the economic crisis then raging.
Despite this, the federal market remains huge, seasoned contractors continue the work of obtaining and carrying out federal contracts, and many companies outside the federal market are trying to get in. Our clients are located throughout the continental United States, in Hawaii, Puerto Rico and U.S. territories, as well as in Iraq and Afghanistan, many with national operations and some with international operations. For example, we have structured protocols for corporate Foreign Corrupt Practices Act compliance, assisted clients with export requirements (for Defense and civilian agency contracts), and served as outside general counsel for companies conducting international operations in Iraq and the Middle East.
More than 50 percent of our commercial clients provide services or goods to the U.S. federal government, state governments, municipal governments and/or foreign governments. A large number of our clients, ranging in any given year from 40 percent to 80 percent, perform engineering, design, or construction services, including IT and ship engineering and construction. This work is not simply going to go away: The consensus is that, as the wars in Iraq and Afghanistan wind down, some of the dollars now allocated to the defense budget will be reprogrammed to the Department of State and USAID, for their programs in South America, North Africa and Central Asia.
On the domestic front, the Department of Health and Human Services seems poised to lead the way in terms of contract opportunities for contractors of all kinds. Each agency, and each sub-agency or department or buying activity, however, has its own culture. Clients seeking to do business with them will have to learn the culture and understand how to work within it.
We expect that litigation will increase as well. On the government contracts side, we anticipate more work in two categories. The first is bid protests — litigation regarding the award of a contract by the U.S. government, by a state, or by a municipality. The second is claims for payment under contracts that have been awarded. Sometimes these are against the government agency awarding the contract, such as the Department of the Navy, or the Washington Suburban Sanitary Commission; sometimes, the dispute is between a prime contractor and a subcontractor on a project.
On the corporate side, although litigation relating to compliance and governance is still significant, we anticipate there will be more litigation in the traditional areas of corporate interaction: breach of contract, breach of non-competition provisions, and protection of intellectual property.