More Confusion On What Costs Are Allocable To Government Contracts
Client Alert | 1 min read | 01.16.09
In a puzzling decision about what appear to be independent research and development (IR&D) costs associated with creating a new software product, Teknowledge Corp. v. U.S. (Jan. 7, 2009), neither party seems to have cited the relevant allocation and allowability rules in Cost Accounting Standard 420, incorporated by reference in FAR 31.205-18, and the CFC's opinion does not mention them, instead sustaining disallowance of the costs on the ground that they did not "benefit" the government. Under the provisions of CAS 420, IR&D costs of a business unit are generally allocable to the contracts of that business unit, and it is not clear based on the facts as described in the opinion whether the costs at issue were incurred in a commercial business unit, a home office, or a government contracts business unit, so it is impossible to determine whether the costs would have been allocable to and allowable on the contracts of the Government business unit if CAS 420 had been appropriately applied.
Insights
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Federal Circuit Resolves Circuit Split on Scope of IPR Estoppel
As part of the 2012 America Invents Act, statutory estoppel was included to balance the interests of patent owners and patent challengers following an inter partes review (“IPR”). Estoppel prevents an IPR petitioner from later asserting in court that a claim “is invalid on any ground that the petitioner raised or reasonably could have raised” during the IPR. 35 U.S.C. § 315(e)(2). As applied, estoppel prevents petitioners from later relying in district court or in ITC proceedings on most patents or printed publications – the limited bases upon which petitioner can rely in an IPR. But a question remained, and contradictory district court decisions arose, as to whether petitioners would be estopped from relying on a prior art commercial product (known as “device art,” which could not itself have been raised in the IPR) even if a printed publication describing the product (i.e. a patent or technical manual) was available and presumably could have been raised.
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U.S. Departments of State and Treasury Issue Immediate Sanctions Relief for Syria
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Opportunities for Procurement on the Horizon as UK Concludes Free Trade Agreement With India
