Category: Aerospace, Defense & Government Services (“ADG”)

Other Transactions: A Flexible and Efficient Acquisition Tool for the Department of Defense

Scott Arnold and Samarth Barot ●

On March 6, 2025, the Defense Secretary released a memorandum directing the Department of Defense (“DoD”) to adopt the Software Acquisition Pathway (“SWP”) to speed up the development, procurement, and delivery of software needed for weapons and business systems. Specifically, the memorandum directed DoD to use Commercial Solutions Openings and Other Transactions (“OTs”) as the default solicitation and award approaches for acquiring capabilities under the SWP. As a result, we are likely to see an expansion in DoD’s use of OTs. Thus, contractors should be aware of the rules and regulations regarding OTs.

Background

While OTs have been in the news a lot these days, they are not a new concept. OTs date back to 1958, when Congress granted the National Aeronautics and Space Administration (“NASA”) the authority to enter into transactions other than contracts, grants, or cooperative agreements in order to foster innovation and speed in the space race.

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What Is DMSMS and What to Do About It?

David L. Bodner and Dominique L. Casimir ●

What does DMSMS mean?

DMSMS stands for Diminishing Manufacturing Sources and Material Shortages. It is the loss or impending loss of manufacturers or suppliers of items, raw materials, or software. In other words, DMSMS is obsolescence. DMSMS occurs when companies (at any level of the supply chain) that make products, raw materials, or software stop doing so or are about to stop. DMSMS issues can occur for various reasons, such as technological advancements, shifts in market demand, regulatory changes, or a manufacturer’s strategic business decision.

Where can contractors find DMSMS requirements?

DMSMS requirements are typically found in prime contracts. Specifically, a Statement of Work (“SOW”) can describe DMSMS requirements such as: a DMSMS Management Plan, a Bill of Materials, Health Status Reports, End of Life Notices, and various other requirements to mitigate DMSMS risks. The contract may use Contract Data Requirements Lists (“CDRLs”) to specify the content of deliverables, the inspection and acceptance process, and the frequency of delivery (e.g., the Contractor must deliver a Health Status Report “monthly” or an End of Life Notice “as required”).

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60-Second Sustains: TISTA Science and Technology Corporation

Elizabeth N. Jochum and David L. Bodner ●

Protest of: TISTA Science and Technology Corporation
B-422891.2; .3; .4

  • TISTA challenged the issuance of a task order by the National Institutes of Health to Tantus Technologies, alleging the agency engaged in unequal treatment of the offerors.
  • The Agency assessed a strength to the awardee for proposing to maintain a “warm bench” of candidates to meet potential surge staffing needs. On the other hand, it assessed a weakness to TISTA for proposing to maintain bench strength with a pool of pre-vetted candidates.
  • The Agency argued there was a distinction in the proposals in that the awardee’s “warm bench” was made up exclusively of existing employees, while TISTA’s would need to hire surge candidates.
  • The Government Accountability Office (“GAO”) rejected the Agency’s argument, finding that both quotations provided for surge staffing with a mix of existing and yet-to-be-hired employees, and sustained the protester’s allegation of disparate treatment.
  • GAO similarly found unequal treatment in the Agency’s decision to assign a strength to the awardee for its use of a “master schedule,” when it did not assign a strength to the protester for proposing use of a “master tracker.”

President Trump Signs New Executive Order: “Implementing the President’s ‘Department of Government Efficiency’ Cost Efficiency Initiative”—What Federal Contractors Need to Know

Dominique L. Casimir, Justin A. Chiarodo, and David L. Bodner ●


On February 26, 2025, President Trump signed an Executive Order (“EO”) that states that it “commences a transformation in Federal spending on contracts, grants, and loans to ensure Government spending is transparent and Government employees are accountable to the American public.” Here’s what government contractors need to know.

Who Does the EO Apply To?

The EO is primarily directed at Agency Heads and contemplates that each Agency Head will work closely with its Department of Government Efficiency (“DOGE”) Team Lead on a number of activities intended to reduce federal spending and root out fraud, waste, and abuse. (On January 20, 2025, President Trump signed EO 14158 establishing DOGE and requiring each agency to have a DOGE Team Lead to “advise their respective Agency Heads on implementing the President’s DOGE Agenda.”).

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Claims Court Breathes Life into Another Path to Protest OTAs

Merle M. DeLancey, Jr. ●

On Monday, February 24, 2025, the Court of Federal Claims (“COFC”) released the public version of a February 13 decision declining to dismiss Raytheon Company’s protest of a $648.5 million award under the Missile Defense Agency’s (“MDA”) interceptor development program. Judge Armando O. Bonilla held that the award was within the court’s jurisdiction over Other Transaction Authority agreements (“OTAs”).

Unsuccessful offerors have had difficulty finding a tribunal with jurisdiction over post-award protests involving OTAs. Under COFC and U.S. General Accountability Office (“GAO”) precedent, an offeror’s ability to protest an OTA award is limited. OTAs are not considered procurement contracts. They are considered non-traditional acquisitions usually involving innovative research and development or prototyping services. They are not based on the Federal Acquisition Regulation (“FAR”) or Defense Federal Acquisition Regulation Supplement (“DFARS”) and are not subject to the Competition in Contracting Act (“CICA”). Under CICA and the GAO’s Bid Protest Regulations, GAO’s bid protest jurisdiction is limited to protests concerning alleged violations of federal agency procurement statutes or regulations in the award or proposed award of contracts for the procurement of goods and services, and solicitations leading to such awards. Under the COFC’s Tucker Act bid protest jurisdiction, COFC’s review is limited to protests “in connection with a procurement or a proposed procurement.” Disappointed OTA competitors also have been unsuccessful seeking relief in U.S. Federal District Courts.

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What Contractors Facing Terminations, Stop-Work Orders, and Suspension of Work Orders Directed by the Trump Administration Need to Know

Stephanie M. Harden, Jennifer A. Short, Justin A. Chiarodo, Shane M. Hannon, and Amanda C. DeLaPerriere ●

The Trump administration’s directives to “pause” grant funding and to terminate certain grants and contracts sent shock waves through the government contracts and non-profit sectors. Although the “pause” in grant funding has been temporarily halted by a federal court (as of January 28), other terminations and suspensions have not been blocked. We summarize below the steps entities can take to preserve their rights as they navigate these emerging directives.

But First: What Happened? 

Immediately after his inauguration on January 20, President Trump began ordering federal agencies to pause funding for certain projects or initiatives. A January 20 Executive Order (“EO”) titled “Unleashing American Energy” encouraged energy exploration and production and eliminated electric vehicle mandates. It directed agencies to “immediately pause” all disbursements under the Inflation Reduction Act of 2022 and the Infrastructure Investment and Jobs Act.

Another EO titled “Ending Radical and Wasteful Government DEI Programs and Preferencing” directed the Office of Management and Budget to terminate DEI programs (see our prior analysis of this EO here). Consequently, the new Department of Government Efficiency announced on January 24 that approximately $420 million in current or impending contracts, most of which related to DEI programs, were cancelled.

Consistent with these orders, the Office of Management and Budget (“OMB”) on January 27 directed federal agencies to pause, as of January 28 at 5:00 PM ET, all payments and obligations to disburse any federal financial assistance, including financial assistance for nongovernmental organizations. The two-page OMB policy memo stated that the paused programs will be assessed to determine whether they are consistent with the administration’s new policy objectives. This directive has led to widespread chaos, prompting the administration to issue additional guidance on January 28 regarding the scope and purpose of the January 27 funding freeze. The freeze on grant funding was then temporarily halted by a federal district court later in the day.

Federal contractors performing contracts or projects subject to these EOs or OMB instructions have or likely will soon receive stop work orders or, in some cases, notices that the government is terminating for convenience. A “suspension of work” or “stop-work” order pauses performance for a period of time, after which the government may decide either to resume performance or terminate the contract. A notice of termination for convenience, as its name suggests, is the mechanism by which the government unilaterally terminates the contract as of right.

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60-Second Sustains: The Mission Essential Group

Elizabeth N. Jochum and David L. Bodner ●

The Mission Essential Group
B-422698.2

  • Mission Essential challenged a task order solicitation issued by the Air Force, alleging the lowest price, technically acceptable (“LPTA”) evaluation scheme violated DFARS 215.101-2-70.
  • The DFARS provision establishes eight criteria, each of which must be met in order for a solicitation to employ an LPTA methodology.
  • It also requires that agencies “avoid, to the maximum extent practicable,” the use of LPTA procedures for procurements of “knowledge-based professional services.”
  • Mission Essential alleged the Air Force failed to meet at least three of the eight criteria allowing for LPTA and that LPTA procedures must be avoided given the type of services sought.
  • GAO sustained the protest, recommending the Air Force revise the solicitation to comply with DFARS 215.101-2-70 and request revised proposals.

BIS Issues New Export Controls Targeting GAAFET, Quantum, and Additive Manufacturing, and Ushers in New Age of Plurilateral Export Controls: 5 Key Takeaways

Anthony Rapa, Alan G. Kashdan, and Brendan S. Saslow ●

The U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) recently issued an interim final rule (“IFR”) under the Export Administration Regulations (“EAR”) imposing licensing requirements for exports to all destinations worldwide of certain gate all-around field effect transistor (“GAAFET”) technology, quantum computing items, advanced semiconductor manufacturing equipment (“SME”), additive manufacturing equipment, and aerospace coating systems technology.

The new measures are notable not only for their restrictive application to all destinations in the world—an unusual type of control under the EAR—but also for their institution of a new license exception, “Implemented Export Controls” (“IEC”), that allows for exports of the newly controlled items to specified “like-minded” countries that have instituted comparable export controls that are harmonized with U.S. controls.

The new controls are effective immediately as of September 6, 2024, with the exception of controls over certain quantum items, which take effect November 5, 2024, the cutoff date for public comment on the IFR.

Read the full client alert on our website.

Upcoming Blank Rome-Hosted ABA Public Contract Law Committee Meetings

Blank Rome is pleased to host two upcoming American Bar Association (“ABA”) Public Contract Law (“PCL”) Committee meetings in September.

Tuesday, September 17, 2024
12:00–1:15 p.m. EDT

Blank Rome’s Washington, DC office will host the annual ABA PCL Bid Protest Committee “Back to School” panel, with a virtual option. This will be followed by a Vice-Chair Planning Session from 1:15 to 2:00 p.m. Committee co-chair and Blank Rome Government Contracts partner Elizabeth N. Jochum will serve as a panelist, along with Samantha Lee (Deputy Assistant General Counsel, Government Accountability Office), Kayleigh Scalzo (Partner, Covington & Burling LLP), Andy Smith (Chief of Bid Protests, U.S. Army), and Evan Williams (Counsel, Mayer Brown LLP). Panelists will discuss important bid protest decisions and developments that you may have missed over the summer. For more information, and to register, please visit: Bid Protest Committee: Annual “Back to School” Panel.

Thursday, September 26, 2024
12:00–1:00 p.m. EDT

Blank Rome’s Washington, DC office will host a meeting of the ABA PCL Intellectual Property Committee, with a virtual option. Committee co-chair and Blank Rome Government Contracts attorney David Bodner will serve as panel moderator, and the panel will include Ted Jung (PEO IWS Chief Architect, Naval Sea Systems Command Headquarters), Rizlane Riahi (Deputy Section Head OGC, Naval Sea Systems Command Headquarters), and Chinedum Okparaeke (Legal Counsel, Anduril Industries). The panel will discuss the topic, “Consider This When Purchasing or Selling Software,” including pre-award data rights considerations when purchasing software as required by the 2023 changes to DFARS Subpart 227.72. For more information, and to register, please visit: Consider This When Purchasing or Selling Software.

3 Takeaways from Recent U.S. Regulatory Actions Implementing AUKUS

Anthony Rapa, George T. Boggs, Justin A. Chiarodo, and Dimitri DeChurch-Silva ●

As a next step in the U.S. government’s implementation of the trilateral AUKUS security pact with Australia and the United Kingdom (“UK”), the U.S. Department of State’s Directorate of Defense Trade Controls (“DDTC”) and the U.S. Department of Commerce’s Bureau of Industry and Security (“BIS”) recently took measures to further ease export controls among the member countries. Reducing export control restrictions is the linchpin to implementing the AUKUS pact, which aims to bolster security cooperation and defense trade between Australia, the UK, and the United States.

While DDTC stopped short of concretely scaling back export controls under the International Traffic in Arms Regulations (“ITAR”), it proposed a framework to do so in the coming year (likely to turn on Australia and the UK completing the adoption of ITAR-equivalent export controls and exemptions). Meanwhile, BIS lifted a range of controls under the Export Administration Regulations, placing Australia and the UK on nearly equal footing with Canada.

Read the full client alert on our website.

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