As Buy American Act and False Claims Act defense lawyers, we help companies and government contractors to avoid and minimize costly mistakes, liability and fines.
Watson & Associates’ Federal government contracts practice group provides detailed legal advice and consulting to federal contractors within the United States and overseas. We represent clients both high-profile and lower-profiled criminal and civil cases.
The Depart of Justice (DOJ), and various inspector general offices (IG) spend a great deal of time investigating small businesses and large DOD contractors for violation of the Buy American Act of 1933 (BAA) and ultimately submitting false claims to the federal government.
For quite some time the United States has tried to revamp its restrictive Government purchasing policies. In recent years the federal government has ramped up its DOJ and OIG investigations of companies selling construction products and materials to the federal government. The goal is to keep American jobs on US soil and to have priority on US-made construction materials.
The Buy American Act requires Federal contracting agencies to purchase domestic materials and products. However, to meet the legal requirements, two conditions must be present for the Buy American Act to apply: (1) the procurement must be intended for public use within the United States; and
- (2) the items to be procured or the materials from which they are manufactured must be present in the United States in sufficient and reasonably available commercial quantities of satisfactory quality.
- The head of the procuring agency may waive the Buy American requirements if he or she determines the act to be inconsistent with the public interest or the cost of acquiring the domestic product is unreasonable.
Watson’s Government Contracts law firm is dedicated to providing legal advice and representation to U.S. and non-U.S. government contractors with legal issues and investigations relating to Country of Origin requirements and requirements of the Federal Acquisition Regulation (FAR), most particularly those relating to various “Buy American” requirements that commonly accompany federal construction contract procurements.
As government contractor fraud lawyers and procurement defense attorneys, we assist with Buy American Act compliance investigations and help to provide legal defense to small businesses and larger defense contractors facing serious criminal and civil consequences. We help with the country of origin requirements, manufacturing concerns and waivers. See information about three defenses for criminal liability for government contractors.
Buy American Act Attorney Services
To become compliant as a prime contractor or subcontractor on a construction project, our Buy American Act attorneys can help with:
- Assessment of your manufacturing process
- Products from overseas and percentage compliance requirements
- Buy American Act investigations by DOJ or IG offices
- COTS items
- FAR compliance
- Assessment for iron steel and manufactured goods
- Allegations of fraud against the US government
- Government contractor fraud
- Legal defense in high-profile cases
- Representation for US and Non- US companies
- Legal counsel and representation for federal government contracts
What is False Claims Buy American Act Fraud?
As a federal government contractor, DOJ and IG law enforcement agencies may claim that you have defrauded the government by knowingly providing goods / products in violation of the Buy American Act and the U.S. Trade Agreements Act. The key to avoiding fraud and False Claims Act claims is to make sure your federal procurement and manufacturing processes do not fall short of the statutory requirements. If your government contractors are charged with committing fraud against the government, investigations and defense can be time-consuming and expensive. Protect your company immediately. See information about FCA retaliation. See More On Buy American Act Frequently Asked Questions
What are the Buy American Act Exceptions?
There are certain statutory “exceptions” to the Buy American Act. The government can purchase foreign materials and end products if:
- the expected value of the procurement is below the micro-purchase threshold ($3,500);
- the goods are for use outside the United States;
- the procurement of domestic goods or the use of domestic construction materials would be inconsistent with the public interest;
- domestic end products or construction materials are unavailable;
- the agency is procuring information technology that is a commercial item; or
- the goods are acquired specifically for commissary resale.
The exceptions are present on a case-by-case basis. Having the right Buy American Act lawyer to defend your company in whistleblower qui tam cases can make a huge difference between acquittal and be subject to criminal liability or large civil fines.
What is a Manufacturer Under the Buy American Act?
Many BAA lawyers have their own interpretation of what is a manufacturer. However, defense attorneys familiar with the Buy American Act will understand that the FAR or Statutes do not have a set definition. Each case is looked at on its own merit.
The BAA tends to suggest that end products and at least 50% of the costs of all components be manufactured in the United States, but “manufacturing” in the United States would not necessarily preclude all processing overseas. See for example. See General Kinetics, Inc., Cryptek Div., B-242052.2 (May 7, 1991).
FAR 52.225-9 Buy American Act Construction Materials: According to the Legal Information Institute Construction material means an article, material, or supply brought to the construction site by federal contractor or a subcontractor for “incorporation into the building or work. The term also includes an item brought to the site preassembled from articles, materials, or supplies. See information about False Claims Act defense cases for contractors.
However, emergency life safety systems, such as emergency lighting, fire alarm, and audio evacuation systems, that are discrete systems incorporated into a public building or work and that are produced as complete systems, are evaluated as a single and distinct construction material regardless of when or how the individual parts or components of those systems are delivered to the construction site. Materials purchased directly by the Government are supplies, not construction material. . See information about substantial transformation under the TAA.
Cost of components means –
(1) For components purchased by the Contractor, the acquisition cost, including transportation costs to the place of incorporation into the construction material (whether or not such costs are paid to a domestic firm), and any applicable duty (whether or not a duty-free entry certificate is issued); or
(2) For components manufactured by the Contractor, all costs associated with the manufacture of the component, including transportation costs as described in paragraph (1) of this definition, plus allocable overhead costs, but excluding profit. Cost of components does not include any costs associated with the manufacture of the construction material.”
What is a Component Under the Buy American Act? As Buy American Act lawyers we suggest that a component is any article, material, or supply incorporated directly into an end product or construction material. See also Marbex, Inc., B-225799 (May 4, 1987).
- Government contract components could potentially be mined, produced, or manufactured in the United States, regardless of their actual place of origin, if
- the end product in which they are incorporated is manufactured in the United States, and
- the components are of a class or kind determined by the government not to be mined, produced, or manufactured in the United States in “sufficient and reasonably available commercial quantities of a satisfactory quality.” See 48 C.F.R. §25.003 (“Components of foreign origin of the same class or kind for which nonavailability determinations have been made are treated as domestic.”); Octagon Process, Inc., B-186850 (Dec. 22, 1976).
How Do you Determine the Cost of Components Under the Buy American Act? Our Buy American Act defense attorneys tend to suggest that the costs of components are generally determined based on certain costs that you incur as a government contractor when purchasing or manufacturing the components.
- for components that you the contractor purchase, the cost of components includes the acquisition costs (including transportation costs to the place of incorporation into the end product or construction material), and any applicable duty (regardless of whether a duty-free certificate of entry is issued); and
- or components manufactured by the contractor, the cost of components includes all costs associated with the manufacture of the component (including transportation, as discussed above), and allocable overhead costs, but excluding profits and any costs associated with the manufacture of the end product.
BAA and False Claims Act Interplay in Criminal and Civil Cases
When the DOJ or other investigative agency sends a letter, it will usually allege a violation of the False Claims Act and Buy American Act. However, unless there is a Buy American violation, it may be difficult to reach the case for false claims. Therefore, it is important to first assess the underlying issue – the Buy American Act. Watson’s false claims act qui tam lawyers can help federal contractors regardless of the state. See What Happens After Government Contractors Receive a Grand Jury Indictment.
As Buy American Act and False Claims Act defense lawyers, we realize that many government contractors and corporate CEOs incorrectly believe that the Act only applies to contract change orders. This is not so. False claims penalties also can apply to bidding documents, Buy American Act certification forms, False certification under SBA small business programs, etc. Other small businesses may find themselves defending against:
- incorrect or inflated invoices,
- improper cost pricing data, wage rates and overhead;
- False representation about contract specifications, terms, and conditions
- Defective materials.
At Watson, our Buy American government contractor fraud lawyers are gaining a reputation as one of the top False Claims Act defense lawyers when it comes to Buy American Act violations and small business procurement fraud allegations. See information about proffer agreements.
Call Watson & Associates BAA Law Firm Today
As a federal government contractor, whether a small business or subcontractor, having an experienced and knowledgeable Buy American Act attorney and procurement fraud defense lawyers working to protect your rights in a government contract fraud case is essential. The Watson & Associates law firm provides full-service government contracting legal services and BAA compliance services.
Call us at 1.866.601.5518.