On January 2, 2023, Diz Locaria was quoted in Law360 on cases to watch in 2023 that have the potential to significantly impact government contractors, including BCFS Hlth and Human Svcs v. LABR.
According to the article, BCFS Health and Human Services has asked the Fifth Circuit to revive its dispute over whether the Service Contract Act (SCA), which sets certain minimum benefit and wage requirements for federal service contractors, covers cooperative agreements. BCFS has argued that the government made a "legally unsupported expansion" of SCA jurisdiction when it applied the statute to BCFS's agreements. The SCA is meant to cover procurement contracts, and BCFS said in a July brief that under the Federal Grants and Cooperative Agreements Act, cooperative agreements are not contracts, but instead a "direct descendant" of grants.
The case once again brings to light "an age-old issue" that cooperative agreements are in most circumstances more akin to grants than contracts, covered under the same regulatory scheme as grants, but — whether by design or by "sloppy drafting" — are also subject to some of the same requirements as contracts in certain areas, Locaria said.
"We do see it from time to time, where there are situations where cooperative agreements are dealt with more like contracts, even though regulatorily they're much closer to a grant than they are a [Federal Acquisition Regulation]-based contract," he said.
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