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Air Force Space Contracts “Watch List” May Preclude Contracts and Subcontracts

Client Alert | 1 min read | 11.28.17

Section 1612 of the National Defense Authorization Act for Fiscal Year 2018 contains a development that should be concerning to contractors working on space procurements. The NDAA requires the Commander of the Air Force Space and Missile Systems Center to develop a “watch list” of contractors with a history of poor performance on space contracts, including procurement contracts and research, development, test and evaluation space program contracts. The basis for inclusion is the Commander’s determination that performance on a specific contract is “uncertain” because of: (1) poor performance or award fee scores of under 50%; (2) financial concerns; (3) felony convictions or civil judgments; security or foreign ownership and control issues. Entire companies or divisions may be included on the “watch list” and inclusion will end the availability of new contracts, options, changes, etc. without the Commander’s permission. The “watch list” will also preclude subcontracts of more than $3 million or 5 percent of the contract value without Commander permission.


This appears to be an attempt to extend the Section 841 warzone contracting exclusion authority to space contracts, without the national security exigency and without an understanding of the special requirements and intense engineering and testing required for space contracting. Although there is a “Rule of Construction” in the law saying the watch list is not a suspension or debarment, the de facto debarment possibilities here are staggering. The “watch list” also would create confusion in the marketplace concerning where to discuss performance issues on space contracts (e.g., with the debarment office, or the SMC Commander - assuming such a meeting would even be possible).

Insights

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].”...