Insights

Last week, we wrote that concerns about excessive, unchecked executive branch power resulting from the Supreme Court’s decision in Trump v. CASA—which declared universal/nationwide injunctions likely exceeded district courts’ equitable authority under FRCP 65—felt premature, because there were a number of other levers district courts could pull to deliver the equivalent of nationwide injunctive relief. We discussed how Section 705 of the Administrative Procedure Act (APA) is one such lever. That section authorizes courts to “postpone the effective date” of a challenged agency action pending judicial review utilizing the same four-factor test applicable to requests for injunctive relief.

On July 11, 2025, the Department of Education issued a new interpretive rule entitled “Clarification of Federal Public Benefits under the Personal Responsibility and Work Opportunity Reconciliation Act.” The Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) generally limits “eligibility for ‘federal public benefits’ to U.S. citizens, permanent residents, and certain categories of qualified aliens.” The Department concluded that certain postsecondary education programs, “including adult education programs authorized under Title II of the Workforce Innovation and Opportunity Act of 2014, [and] postsecondary career and technical education programs under the Carl D. Perkins Career and Technical Education Act of 2006,” constitute “Federal public benefits under the PRWORA and thus are subject to PRWORA’s citizenship verification requirements.”

Current political priorities in Congress will continue to push many industries under the microscope of Congressional investigations, including universities, tech companies, entities that receive federal funds, and energy-sector companies. When the chambers of Congress and the executive branch are controlled by the same party, Congressional oversight of the executive branch is less intense and instead public and private sector, state, and local entities are more likely to find themselves in the crosshairs. If a chamber of Congress changes hands in the midterm elections, the focus of the oversight may shift to reflect the policy priorities of the moment and include more executive branch oversight, but even the executive branch is often contending with requests for information that may implicate their dealings with third parties; for example, there is a risk that agency oversight triggers requests for privileged material belonging to a government contractor or grantee. The topics and industries of highest interest may play musical chairs, but entities across sectors would do well to incorporate a few best practices that will mitigate their risk should they end up in the hot seat, either directly or through a government partner.

Briefing. The Trump administration continues to raise the stakes for importers and other actors in the international trade space. Bloomberg Law reports that the Department of Justice has tasked its MIMF (Market Integrity and Major Frauds) Unit with investigating fraud schemes by companies dodging U.S. tariffs. The MIMF Unit is already well-versed in financial fraud investigations, is set to grow significantly with the addition of prosecutors previously assigned to consumer protection matters, and now is shifting resources to tariff evasion cases.

The Armed Services Board of Contract Appeals published its FY18 Report of Transactions and Proceedings, which provides statistics regarding the adjudication of appeals between contractors and the Army, Navy, Air Force, Corps of Engineers, DLA, DCMA, CIA, NASA, other Defense agencies, and the Washington Metropolitan Area Transit Authority. According to this year's report, appellants prevailed, in whole or in part, in 69 percent of the appeals decided on the merits, a notable increase from the past several years. As usual, the Board had a high success rate in resolving matters via alternative dispute resolution (ADR), successfully resolving 85 percent of ADRs concluded in FY18 – including binding arbitration, non-binding mediation, and ADR of undocketed appeals.

In Montana Health Co-Op v. U.S. (September 4, 2018), an important decision likely to reverberate throughout the health insurance industry, the U.S. Court of Federal Claims granted summary judgment in favor of C&M client Montana Health in a lawsuit seeking to recover "cost-sharing reduction" (CSR) payments pursuant to §1402 of the Affordable Care Act, deciding on the merits that: (i) Section 1402 of the ACA is money-mandating, (ii) Montana Health is entitled to full payments owed to it under the statutory formula set forth in the ACA, and (iii) the federal government has a statutory obligation to provide Montana Health with the CSR payments notwithstanding the purported lack of appropriations to fund such payments. The Court agreed with Montana Health that the obligation to make payment under a money-mandating statute is distinct from the appropriation used to fund it, and that the lack of an appropriation merely restricts the Government’s agents (here, HHS), but does not negate the United States’ statutory payment obligation. The Montana Health decision is a significant decision in COFC money-mandating statute jurisprudence.

On July 30, the U.S. District Court for the Northern District of Texas issued a decision in Air Center Helicopters Inc. v. Starlite Investments Ireland Ltd et al. (Case No. 18-599), upholding a temporary injunction issued by the American Arbitration Association that granted Defendant Starlite Aviation Group (a C&M client) the right to continue performing helicopter services in support of U.S. military operations in Afghanistan. In seeking to vacate the AAA’s Injunction Order, Plaintiff argued that the arbitrator exceeded his powers by granting Defendant relief under an implied-in-fact contract theory, and contemporaneously sought a preliminary injunction preventing Defendant from enforcing the AAA Injunction Order (which the parties briefed on an expedited basis). The Court rejected Plaintiff’s arguments and denied both motions, holding that (i) “[Plaintiff] cannot show a likelihood of success on the merits regarding its petition,” such that “[Plaintiff]’s motion for preliminary injunction must necessarily be denied;” (ii) Plaintiff had “not met its high burden to show that the arbitrator imperfectly executed or exceeded his powers” in the AAA Injunction Order, and thus Plaintiff was not entitled to vacatur. The Court noted that its rulings were subject to a later determination as to whether the Court had jurisdiction to review the AAA Injunction Order.

Contractors looking for updates to the statutory allowable cost limits on employee compensation may be looking in the wrong place. Historically, such limits were posted in the Federal Register for public notice. However, the OFPP recently posted the annual increases for costs incurred in 2015-2018 on its website instead of publication through the Federal Register.

On November 29, 2017, the United States filed a brief in support of certiorari in Raymond J. Lucia Cos., Inc. v. SEC, urging the U.S. Supreme Court to use the case to hold that the existing hiring process for federal administrative law judges (ALJs) is unconstitutional. To date, federal courts of appeals have split on the question: the D.C. Circuit ruled that ALJs are mere “employees” of the federal government and are properly hired through a competitive process overseen by the Office of Personnel Management (OPM); the Tenth and Fifth Circuits, on the other hand, ruled that ALJs are “inferior officers” of the United State and must therefore be appointed as dictated by the Appointments Clause of the U.S. Constitution, as previously discussed here and here. The answer to the question could have significant consequences for thousands of ALJs serving in dozens of federal agencies who are routinely charged with overseeing discovery in agency proceedings, issuing subpoenas, making findings of fact, and deciding cases. The Supreme Court should decide whether to accept the case for argument early next year.

In Leviathan Corp. (Apr. 20, 2017), the ASBCA ruled in favor of Crowell & Moring client Leviathan in its 11-year contract dispute with the U.S. Army. Leviathan delivered military supplies to the Iraqi army during the Iraq War. The contract was technically between a different prime contractor and the Coalition Provisional Authority (the predecessor to the new Iraqi government), not the U.S. government. The U.S. Army administered the contract and signed a termination settlement agreement. But the Army refused to pay Leviathan because the Government argued that: (1) the Board lacked jurisdiction over Coalition contracts, (2) Leviathan lacked standing because it was not the prime contractor, and (3) a termination settlement is not a CDA “procurement” contract. Leviathan successfully argued that the Army and Leviathan both became parties to the contract through two respective implied-in-fact novations. Further, because of the Army’s novation, the Army stepped into the Coalition’s shoes from the outset, thereby converting the original contract into a CDA “procurement” contract.

In Health Republic Insurance Co. v. U.S. (Jan. 10, 2017), the Court of Federal Claims (Court) rejected the Government’s motion to dismiss a lawsuit filed under the Tucker Act seeking to recover “risk corridors” payments pursuant to §1342 of the Affordable Care Act, holding that “HHS is required to make annual risk corridors payments to eligible qualified health plans” under the ACA, and that the “plaintiff’s claim for unpaid risk corridors payments is ripe for adjudication.” The Court’s decision was based on several factors, including the risk corridors program’s purpose of stabilizing insurance premiums in the ACA’s new and untested health insurance marketplace; notably, the Court held that even if the ACA were ambiguous and the court were to apply a Chevron deference analysis, HHS has interpreted the program to require annual payments, and the agency’s own actions (i.e., making partial annual payments) indicate it believes the program is annual in nature.

On December 27, 2016, the National Institute for Occupational Safety and Health (NIOSH) published a revised Chemical Carcinogen Policy (Current Intelligence Bulletin 68). It is the first such revision in over 10 years and embodies a significant change in policy from earlier versions.

On November 16, 2015, the Occupational Health and Safety Administration (OSHA) released in draft the first revision to its Safety and Health Program Management Guidelines in over 25 years. The draft revised guidelines, originally published in 1989, incorporate lessons learned and best practices from existing OSHA programs and similar industry and international initiatives and also reflect modern technology and practices. According to OSHA's website on the draft revised guidelines, they incorporate, among other things, a more proactive approach to "finding and fixing hazards before they cause injury, illness or death," "improved safety and health in all types of workplaces," "increased worker involvement," and "better communication and coordination on multi-employer worksites."