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IR&D Definition Clarified

Client Alert | 1 min read | 03.19.10

In a decision that should resolve finally nearly 40 years of disagreement between contractors and the government about the definition of Independent Research and Development (IR&D), the Federal Circuit has held in ATK Thiokol Inc. v. U.S. (Mar. 19, 2010), that R&D effort must be "specifically required" by the terms of a contract in order to be excluded from the definition of allowable IR&D costs, endorsing the contractors' argument that effort that is "implicitly" required in order to perform the contract or "necessary" to perform but not explicitly required by the contract is allowable IR&D. In addition, and perhaps even more important, the decision acknowledges more generally in its analysis of the distinction between direct and indirect costs that "CAS 402 gives the contractor considerable freedom in the classification of particular costs, so long as the contractor maintains consistency in making that determination."

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Client Alert | 3 min read | 06.12.26

DOJ Guidance Backs Away From Disparate Impact Liability

On June 9, 2026, the U.S. Department of Justice (DOJ) issued a formal opinion concluding that the Equal Opportunity Employment Commission’s (EEOC) existing interpretations of Title VII of the Civil Rights Act of 1964 (Title VII) disparate-impact liability, including the Uniform Guidelines on Employee Selection Procedures (UGESP), are unconstitutional. According to the opinion, EEOC’s prior interpretations contemplate liability based on disproportionately adverse effects alone, without regard to an employer’s likely intent, rather than treating disparate impact as an evidentiary mechanism to “smoke out” intentional discrimination. DOJ found that this approach functions as a “qualified racial-proportionality mandate” that places “a racial thumb on the scales, often requiring employers to evaluate the racial outcomes of their policies, and to make decisions based on (because of) those racial outcomes.” The opinion fulfills one mandate of Executive Order 14281, which rejected disparate-impact liability insofar as it “creates a near insurmountable presumption that unlawful discrimination exists wherever there are any differences in outcomes among different [demographic groups].”...

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