Contractors and subcontractors can no longer receive reimbursement from the government for the costs of defending themselves against whistle-blower lawsuits deemed legitimate.
The fiscal 2013 National Defense Authorization Act (P.L.112-239) called for the change. On Oct. 22, the Defense Department, the General Services Administration and NASA published an interim rule, which was effective Sept. 30, to implement the law.
The Federal Acquisition Regulation previously only forbade contractor reimbursement for legal costs incurred in proceedings brought by a government–federal, state, local or foreign. The new rule amends the FAR to include legal costs from proceedings brought by a contractor or subcontractor employee “submitting a whistleblower complaint of reprisal.”
The rule also broadens the scenarios that render the whistle-blower complaint legitimate. Previously, the FAR said the contractor would have to be found liable or fined in a civil proceeding in order to disqualify it from reimbursement. In the case of a criminal proceeding, it would have to be convicted.
Keep reading this article at: http://www.fiercegovernment.com/story/contractor-costs-whistle-blower-cases-no-longer-reimbursable/2013-10-22
The interim rule can be found in the Federal Register at: https://www.federalregister.gov/articles/2013/09/30/2013-23702/federal-acquisition-regulation-allowability-of-legal-costs-for-whistleblower-proceedings. Comments are due by Nov. 29, 2013.
