Morrison Foerster’s Government Contracts Insights provides our in-depth analysis of developments and trends impacting government contracting. Through Insights, our attorneys offer a real-time assessment of the statutory, regulatory, legal, and business-related developments and trends that are shaping the industry. We also examine a full array of non-U.S. public procurement issues, mindful that our clients compete in a global marketplace.Morrison Foerster’s nationally recognized Government Contracts and Public Procurement practice represents the world’s leading companies in the aerospace and defense, intelligence, cybersecurity, information technology, financial and professional services, education, healthcare, infrastructure, and logistics support sectors. We are enlisted to address our clients’ most complex and important legal issues. Our work includes contract and subcontract negotiation and other transactional matters, business and regulatory compliance counseling, internal investigations, bid protests, and a wide array of enforcement and litigation matters. Our clients range from Fortune 50 companies to small and medium-sized companies just entering the public sector. We advise both U.S. and non-U.S. companies involved in municipal, state, federal, and non-U.S. procurement matters.<h2>ABOUT MORRISON FOERSTER</h2>Morrison Foerster is a leading global law firm that transforms complexity into advantage for its clients. Our clients include some of the largest financial institutions, banks, consulting and accounting firms, and Fortune 100, technology, and life sciences companies. Highlighting the firm’s commitment to client service, leadership in market-changing deals and impact litigation, and values-based culture, Morrison Foerster has been repeatedly recognized as one of the top 10 firms on The American Lawyer’s A-List. Year after year, the firm receives significant recognition from Chambers and The Legal 500 across their various guides, including Global, USA, Asia‑Pacific, Europe, UK, Latin America, and FinTech Legal. Our lawyers passionately care about delivering legal excellence while living our values. Morrison Foerster has a long-standing commitment to creating a culture that respects and celebrates differences, while providing an inclusive environment. The firm has achieved Mansfield Certification Plus since 2018 as a result of successfully reaching at least 30 percent women, communities of color, and LGBTQ+ lawyer representation in a notable number of current leadership roles and committees. The firm also has a long history of commitment to the community and society through providing pro bono legal services, including litigating for civil rights and civil liberties, improving public education and fostering the wellbeing of children, advocating for veterans, promoting international human rights, enforcing the right to asylum, and safeguarding the environment.

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Tina is Co-chair of Morrison Foerster’s Government Contracts & Public Procurement practice. She represents a wide variety of government contractors including information technology, defense, biotechnology, and pharmaceutical companies, with a focus on general contract counseling and compliance, particularly concerning intellectual property, and cybersecurity matters and federal grant funding.Tina counsels contractors on compliance with federal, state and local acquisition and ethics regulations and with the evolving myriad of requirements pertaining to data security and cybersecurity. She has been involved with numerous internal investigations and compliance reviews, and with mandatory and voluntary disclosures to agencies, and litigation of False Claims Act matters.Tina routinely advises clients concerning:<ul><li>Prime-subcontractor relationships</li><li>Sources of supply and country of origin requirements</li><li>Price reductions and price reporting issues</li><li>Organizational conflicts of interest</li><li>Safeguarding of intellectual property and other proprietary interests</li><li>Licensing and data rights issues</li><li>Handling of classified materials and controlled unclassified information</li><li>Agency suspension and debarment proceedings</li></ul>She also assists clients with due diligence and other activities related to the acquisition of government contracting concerns, and with the drafting and negotiation of teaming agreements, subcontracts, licensing agreements, and cooperative research and development agreements. She also assists clients applying for federal grants (including SBIR and STTR agreements), and those who seek to obtain other transactional authority agreements, as well as those competing for state and local government work.Tina’s litigation experience includes government contracts claims litigation in federal courts and before boards of contract appeals, bid protests before the Government Accountability Office and the Court of Federal Claims, and complex disputes in federal courts, including civil fraud and False Claims Act litigation and reverse Freedom of Information Act litigation.Prior to joining Morrison Foerster, Tina worked at another large national firm and as a trial attorney in the Office of the General Counsel of the Navy, Navy Litigation Office.<h4>Representative Experience</h4><ul><li>Negotiation of largest CHIPS Act federal funding agreement between multinational semiconductor corporation and U.S. Department of Commerce.</li><li>Negotiated prime contract and major subcontracts related to the Department of Energy’s next generation supercomputer program, including extensive IP rights negotiations and negotiation of associated patent rights waivers.</li><li>Negotiated series of other transaction authority agreements with DARPA and associated subcontracts with more than a dozen research universities on behalf of a firm biotech client, including complex IP rights allocations and material transfer agreements.</li><li>Assist clients with FedRAMP authorization process and with development of license agreements for software products sold to federal, state and local government agencies.</li><li>Cyber incident response counseling to some of the largest companies and organizations impacted by security incidents.</li><li>Advises clients on Bayh-Dole reporting of inventions and IP strategies for contracts and grants.</li><li>Conducts due diligence for major government contract mergers and acquisitions.</li></ul>

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Tina is co-chair of Morrison Foerster’s Government Contracts & Public Procurement practice. She counsels a wide variety of government contractors on compliance with federal acquisition and ethics regulations. She drafts and negotiates contracts on their behalf and has been involved with numerous internal investigations and compliance reviews, and with bid protest, contract claims, and False Claims Act litigation. She also advises on M&A transactions involving government contractors.

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Jim Tucker is of counsel in Morrison Foerster’s Government Contracts and Public Procurement Practice Group and is based in the firm’s Washington, D.C. office.Jim’s practice runs the gamut of litigation and counseling in federal procurement matters, with an emphasis on bid protests, Cost Accounting Standards disputes, and small business matters. He has represented both protesters and awardees in scores of protests before the Government Accountability Office, the Court of Federal Claims, and procuring agencies, in acquisitions ranging from small business procurements to multibillion-dollar contracts of global significance. His representative protest matters span the aerospace sector, the Intelligence Community, base operations and logistics, healthcare, nuclear and environmental work, and information technology and software acquisitions. His protests have included both classified and unclassified programs. In addition to prevailing in published decisions, Jim has also secured favorable corrective action on behalf of clients in a wide variety of protests that were resolved without a published decision.Jim’s work also focuses on disputes over cost allowability and compliance with the Cost Accounting Standards, and he has appeared before the Armed Services and Civilian Boards of Contract Appeals, in size and status protests before Small Business Administration (SBA) area offices, and appeals before the SBA Office of Hearings and Appeals. Jim regularly counsels clients on contract interpretation, organizational conflicts of interest, and small business compliance.Jim graduated with high honors from the George Washington University Law School, where he focused his studies on federal procurement law, was a member of the Law Review, and interned with the General Services Administration’s suspension and debarment office. Jim also holds a degree in theology magna cum laude from the Pontifical Gregorian University in Rome and a bachelor’s degree in classical languages and literature summa cum laude from the University of Kentucky, where he graduated Phi Beta Kappa.

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Jim maintains an active practice in bid protests before the Government Accountability Office and contracting agencies and counsels clients in contract disputes and compliance obligations.

Jim Tucker is of counsel in Morrison Foerster’s Government Contracts and Public Procurement Practice Group and is based in the firm’s Washington, D.C. office. Jim’s practice runs the gamut of litigation and counseling in federal procurement matters, with an emphasis on bid protests, Cost Accounting Standards disputes, and small business matters.

James Tucker

<div style="margin-bottom: 15px;" class="videoWrapper"><iframe class="sticky-video" title="Meet Alex Ward, Government Contracts Practice Co-Chair" src="https://www.youtube-nocookie.com/embed/TkliwdSlTaQ?rel=0" frameborder="0" allow="autoplay; encrypted-media" allowfullscreen="1" title="iframe"></iframe></div>J. Alex Ward is co-chair of Morrison Foerster’s Government Contracts and Public Procurement group. His practice covers a full range of government contracts matters, including investigations, bid protests, claims, general litigation, corporate transactions, and counseling. Alex strives in all matters is to provide his clients the highest level of efficient and effective representation.Alex represents contractors in internal and external investigations, disclosures to the government, and qui tam litigation, with great success in reducing or eliminating his clients’ exposure through active engagement with the government. His work in this area includes obtaining numerous declinations and dismissals of False Claims Act cases in their earliest stages, sparing his clients the cost, risk, and exposure of litigation.He has also served as lead counsel in dozens of bid protests involving military and civilian agency procurements of a wide range of products and services, including all manner of pre- and post-award protests in the GAO, the U.S. Court of Federal Claims, and state tribunals, as well as appeals to the U.S. Court of Appeals for the Federal Circuit and size protest appeals before the SBA’s Office of Hearings and Appeals.Alex handles all aspects of the claims process, from the initial assessment and drafting of requests for equitable adjustment through litigation in the Boards of Contract Appeals and the Court of Federal Claims. Alex’s practice also covers the full gamut of other controversies confronting government contractors, including prime-sub, teaming partner, employer-employee, competitor, and indemnification disputes. His litigation work also includes a wide variety of pro bono engagements, in which he has represented both individual and institutional clients in matters ranging from immigration and criminal defense to sustainable procurement and protection of the environment.Prior to joining the firm, Alex served in the U.S. Army as a commissioned officer and an Assistant to the General Counsel of the Army responsible for civil works and international matters, and as a clerk for judges on the U.S. Courts of Appeals for the Armed Forces and the D.C. Circuit. He is a member of the Boards of the Morrison & Foerster Foundation and the Chesapeake Bay Foundation and of Law360’s Government Contracts Editorial Board.

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Alex is co-chair of Morrison Foerster’s Government Contracts and Public Procurement practice. His practice covers a full range of government contracts matters, including bid protests, claims, investigations, corporate transactions, and counseling.

J. Alex Ward

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Morrison Foerster’s Government Contracts Insights blog provides an in-depth analysis of news, developments, and trends impacting government contracting and procurement. Through Insights, attorneys from our nationally recognized Government Contracts and Public Procurement practice will offer a real-time assessment of the statutory, regulatory, legal, and business-related developments that are shaping the industry. This blog will also examine a full array of U.S. and non-U.S. public procurement issues, mindful that our clients compete in a global marketplace.Read about our <a href="http://govcon.mofo.com/editors/">Authors</a>.Never miss a post. Subscribe to get real-time updates.

Brad is a partner in Morrison Foerster’s Litigation Department, Managing Partner of the Austin office, and Chair of the firm’s Israel practice. He is the former Co-Chair of the firm’s Global Litigation Practice and the Government Contracts + Public Procurement Practice.

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On May 12, 2021, the Biden administration issued an ambitious Executive Order on Improving the Nation’s Cybersecurity (EO) declaring the prevention, detection, 

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Executive Order on Cybersecurity Expands Mandatory Breach Notification and Supply Chain Security Requirements for Government Contractors

Executive Order on Cybersecurity Expands Mandatory Breach Notification and Supply Chain Security Requirements for Government Contractors | Government Contracts Insights

Sandeep N. Nandivada

On May 12, 2021, the Biden administration issued an ambitious Executive Order on Improving the Nation’s Cybersecurity (EO) declaring the prevention, detection, assessment, and remediation of cyber incidents to be a “top priority and essential to national and economic security.” Over 8,000 words long, the EO establishes a series of initiatives designed to better equip the U.S. federal government to respond to cybersecurity threats. The most notable provisions of the EO are as follows:<ul><li>It sets in motion changes to federal contracts that will add breach notification and information sharing requirements for government service providers and remove existing contractual barriers to threat information sharing by the private sector;</li><li>It establishes baseline security standards for the development of software sold to the government by all commercial suppliers; and</li><li>It provides minimum cybersecurity requirements for federal agencies, like the use of multifactor authentication and encryption, and helps to move the federal government toward secure cloud services and zero-trust architecture.</li></ul>The EO reflects the government’s heightened concerns about cyber threats, particularly following the SolarWinds, Microsoft Exchange, and Colonial Pipeline incidents. It also reflects the Administration’s efforts to leverage the buying power of the federal government to incentivize the software market to build security into the software development lifecycle, and to expand and enhance the information sharing between the private sector and the government.<h4>STATUS QUO</h4>Currently, federal contractors’ cyber incident reporting requirements are primarily based on a patchwork of agency-specific policies, regulations, and contract clauses. For example, the Defense Federal Acquisition Regulation Supplement (DFARS) requires reporting of incidents that affect “covered defense information,” while other agencies require reporting in the form of contract clauses or agency information security policies and only if agency-specific information or certain categories of information held by the agency (such as personally identifiable information or protected health information) have been compromised.The Federal Acquisition Regulation (FAR) has a basic safeguarding clause, FAR 52.204-21, that applies to nearly all federal contractor information systems. This clause currently stops short of requiring breach notification. Instead, it merely imposes basic safeguarding requirements and procedures amounting to good cybersecurity hygiene. By contrast, DFARS 252.204-7012, requires defense contractors to “rapidly report” – i.e., within 72 hours – any “cyber incident” following a review for evidence of compromise.In sum, many government contractors are already subject to security incident notification requirements, but they vary depending upon the agencies with which those companies contract, and the nature of the information traversing their information technology (IT) systems.<h4>THE EO’S CYBER INCIDENT REPORTING REQUIREMENTS</h4>The new EO seeks to expand existing cyber breach notification requirements by modifying contract terms to require all providers of IT and operational technology (OT) services to the federal government, including, but not limited to, cloud service providers, to share threat and security incident information with select executive departments and agencies responsible for investigation and remediation of cyber incidents. These include the Cybersecurity and Infrastructure Security Agency (CISA), the Federal Bureau of Investigation (FBI), and the other elements of the Intelligence Community (IC).To implement this process, the EO requires a review and update of the current FAR and DFARS contract requirements for IT and OT service providers. As revised, these clauses will be designed to ensure that covered contractors collect and preserve cyber incident and cyber threat-related information, and share such information with the designated government agencies. Moreover, the EO requires federal agencies to propose contract language to the FAR Council that would require information and communications technology service providers to report certain types of cyber incidents to federal agencies, and CISA in particular, within a prescribed period of time. Among the specifics requested by the White House are a maximum three days from detection reporting requirement for “the most severe cyber incidents.” The EO sets a rather aggressive timeline for the FAR Council to review and publish for public comment the proposed new regulations, which could mean that we will see proposed updates to the FAR before the end of the year.The EO also requires the removal of barriers that inhibit the sharing of threat information, such as contractors’ incident response data, within the federal government. The EO directs the Office of Management and Budget (OMB), in consultation with other agencies, to propose updates to contract language to ensure contracts do not contain obstacles to the sharing of threat and cyber incident information within government. Such sharing will improve prevention, detection, and response and also foster collaboration among agencies, the FBI and CISA in their investigations of cyber incidents.Finally, new standardized cybersecurity requirements for all government contractors may be considered and adopted by the FAR Council.Much work remains to be done before new clauses are implemented in federal contracts, but contractors are now on notice of a potential sea change on the horizon.<h4>OTHER POTENTIALLY SIGNIFICANT DEVELOPMENTS FOR GOVERNMENT CONTRACTORS</h4><h5>MODERNIZATION OF THE GOVERNMENT’S IT SYSTEMS AND OF THE FEDERAL RISK AND AUTHORIZATION MANAGEMENT PROGRAM (“FEDRAMP”)</h5>The EO calls for the modernization of the federal government’s approach to cybersecurity, including adoption of best practices like the use of multifactor authentication and encryption, movement towards zero-trust architecture, and acceleration of adoption of cloud service solutions. The EO requires agencies to take steps toward implementation of these goals. In addition, the EO establishes a framework for the modernization of FedRAMP, suggesting a potential revamping of the currently cumbersome FedRAMP authorization process used for vendors seeking permission to provide cloud service offerings to government customers. This modernization effort offers significant opportunities for software vendors and IT service providers to expand their reach within the government.<h5>ENHANCED SUPPLY CHAIN SECURITY</h5>The EO also seeks to enhance supply chain security, particularly for “critical software” that has or enables privileged or direct access to networking and computing resources. The EO directs the National Institute of Standards and Technology (NIST) to develop guidelines for software vendors and promulgate a list of secure software development lifecycle standards with which all commercial suppliers to the government must comply.Among the criteria to be examined and regulated will be: (1) the development environment, including examination of access controls and use of automated tools to maintain integrity; (2) the developers’ transparency regarding security data; and (3) the provenance of the software, including review of a software bill of materials (SBOM) for each product. There may also be procedures for agencies to request artifacts demonstrating product integrity and for software providers to participate in a vulnerability disclosure program.Only software that is compliant with these newly established rules will be eligible for federal procurement. Non-compliant software will be removed from all indefinite delivery, indefinite quantity contracts; federal supply schedules, federal government-wide acquisition contracts; blanket purchase agreements, and multiple award contracts. Legacy software must either meet the new requirements or be redesigned to do so.It is worth keeping in mind the broader context of these supply chain reforms as part of a coordinated response to recent high-profile attacks. U.S. intelligence agencies have already begun reviewing supply chain risks, especially those associated with Russian companies. Of particular concern are any back-end software designs and coding done in Russia or other untrustworthy countries with the capacity for sophisticated cyber intrusions. The EO thus requires the FAR Council to propose supply chain security requirements, to be applicable to all government contractors. Those products and services that do not meet the government’s requirements will not be able to be sold to federal agencies.<h4>OTHER CYBERSECURITY ENHANCEMENTS</h4>In addition to its requirements for enhanced information sharing and supply chain security, the EO advances several other measures aimed at bolstering federal cybersecurity coordination and standardizing responses to cyber incidents.These include:<ul><li>Establishment of a Cyber Safety Review Board to improve government remediation of significant cybersecurity incidents. The Board’s membership will be drawn from the Department of Defense and Justice, CISA, the National Security Agency (NSA), and the FBI, with representation from private sector cybersecurity and software suppliers as determined appropriate by the Department of Homeland Security.</li><li>Standardization of the federal cyber incident response playbook developed by CISA in conjunction with the OMB, agency chief information officers, the federal Chief Information Security Officer Council, the NSA, the Attorney General and the Director of National Intelligence, which will conform response processes across all federal agencies.</li><li>Development of government-wide federal/civilian Endpoint Detection and Response (EDR) approach to support CISA-managed cyber threat hunting, detection, and response.</li><li>Issuance of policy requirements for agency logging, log retention, log management, and centralization of top-level security operations within each agency to improve the government’s overall investigation and response capabilities.</li></ul><h4>IMPLICATIONS FOR GOVERNMENT CONTRACTORS</h4>Although the EO previews desired and forthcoming new requirements, full implementation of the new rules will take time. The EO simply puts contractors on notice of the government’s plan to adopt new heightened cybersecurity standards and reporting obligations that will be implemented in the near future. Because the responsible agencies, in conjunction with the FAR Council, must still work to implement the EO, contractors will have time to prepare to meet the new standards and the opportunity to comment on the proposed FAR regulations (a process that we will be monitoring closely).That being said, unlike the existing DFARS 252.204-7012 cyber incident notification requirements, the new requirements have the potential to directly affect nearly all government contractors. While the new requirements may simplify notification requirements for contractors by creating a federal government-wide standardized approach, companies that have not previously implemented rigorous cybersecurity measures and incident response protocols may find themselves unprepared for this new era of cybersecurity. The new rules will also force scrutiny of the development cycle and supply chain for software and service providers in a manner not previously seen. The stakes are high for IT companies with significant government sales, and the opportunities are potentially ripe for new contractors seeking to replace them.Markus Speidel, a Law Clerk in the Morrison & Foerster LLP Government Contracts + Public Procurement practice, contributed to this alert.

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