High Court Term Yields Mixed Rulings For Contractors

Government Contracts Group partner John E. McCarthy, Jr. is featured for his comments on the U.S. Supreme Court’s recent rulings in Schindler Elevator Corp. v. United States ex rel. Kirk, The Board of Trustees of Leland Stanford Junior University v. Roche Molecular Systems Inc., and General Dynamics Corp. v. United States.  These cases tackled a range of issues including, False Claims Act standing, contractor legal defenses that implicate state secrets privilege, and the Bayh-Dole Act  as it relates to the ownership of inventions funded by federal money.

Addressing the Schindler case, McCarthy said, ‘The high court's decision barring an agency's response to a FOIA request from disclosure under the FCA clarified an issue that had divided the circuit courts…The Schindler case is a win for contractors…Presumably, for whistleblower suits you want people who are involved and have direct knowledge rather than people who are fishing around with FOIA requests.".”

In the Stanford case, McCarthy believes the outcome is a wakeup call for both universities and government contractors generally.  He is “more inclined to agree with the dissent, noting the ruling meant that contractors should go over all their patent assignment agreements to make sure they have the strongest possible language.”

Lastly, in the General Dynamics case, McCarthy believes the decision will “likely apply only rarely to future cases as the high court focused on the specific issues in the case rather than dealing broadly with state secrets.”