News from the Chair

• Pages: 2-46
• Date: 01 January 2025
• Author: Jason N. Workmaster
• Subject Matter: Administrative & Public Law

News fro th

CHAIR

In my last column, I shared

my excitement about the

year ahead for members of

the Section of Public Con-

tract Law. I am happy to re-

port that, since then, the

Section has been busy and

successful, with more good

news and activities to come.

I begin with a shout-out

to Kara Sacilotto (Wiley

Rein LLP), who served as

the Conference Director for the Section’s Fall Forum

in November in Reston, Virginia, along with the Con-

ference Co-Chairs Stephen Bacon (Rogers Joseph

O’Donnell PC), Ann McRitchie (Amentum Inc.), An-

drew Smith (US Army Legal Services Agency), and

Abigail Stokes (The Boei ng Company, Boeing Defense

Space & Security), who did an absolutely stellar job pla n-

ning and conducting the conference—supported by our

indefatigable Section Director Patty Brennan and Pro-

gram Specialist Sean Dickerson. Moving our Fall edu-

cational conference to the Belt way area was in direct

response to feedback the Section received over the last

several years about the time and travel commitments

preventing our government and in-house counsel mem-

bers from attending—and the move to Reston worked! It

was wonderful to see so many of our government and in-

house counsel colleagues at the Forum. I received po si-

tive feedback from attendees that they appreciated the

Section’s efforts to relocate the Forum, the proximity to

where they work and live, and the walkability of the Res-

ton Town Center shops, restaurants, and the no-host

dinners—bringing an old Section tradition to a new lo-

cation. The Section reception was a highlight as well.

I, for one, was deeply moved to be with my professional

“family,” just a few days after such a contentious election,

and see the George Mason Army ROTC Color Guard

post and present the colors and hear the National An-

them played in honor of our Armed Services govern-

ment contracting professional s. Last, but cer tainly not

least, the substantive content of the programmi ng was

simply second-to-none—again, thanks to the planning

BY JASON N. WORKMASTER

Jason N. Workmaster is a member of Miller & Chevalier Chartered in

Washington, DC.

continued on page 46

team and our outstanding slate of speakers and modera-

tors, including luncheon speaker, Craig Whitlock of The

Washington Post, whose discussion of his books on the

Afghanistan war and the Fat Leonard scandal was simply

fascinating. The meeting was very well-received and the

Fall Forum will return to Reston in November 2025. You

can read an article from Kara Saciilotto summarizing the

Fall Forum in this issue of The Procurement Lawyer.

LA

WYER

Procuremen

THE

The Procurement Lawyer (ISSN: 1079-073X) is published quarterly by the

American Bar Association’s Section of Public Contract Law, 321 N. Clark St.,

Chicago, IL 60654-7598, as a benet of Section membership. Nonmember digital

subscription packages for ABA periodicals are available through HeinOnline.

If interested, former print subscribers and ABA non-members can visit www.

heinonline.org. The Procurement Lawyer seeks to provide Section members

information on current developments in federal, state, and local procurement law.

The materials contained herein represent the opinions of the authors and editors

and should not be construed to be those of either the American Bar Association

or the ABA Section of Public Contract Law unless adopted pursuant to the bylaws

of the Association. The materials contained herein are not intended as and cannot

serve as a substitute for legal advice. Readers are encouraged to obtain advice

from their own legal counsel. These materials and any forms and agreements

herein are intended for educational and informational purposes only.

Change of Address: Mail to The Procurement Lawyer, Member Records,

321 N. Clark St., Chicago, IL 60654-7598, contact the ABA Service Center at

service@americanbar.org, or call (800) 285-2221.

Reprints: For permission, send requests to copyright@americanbar.org or go to

www.americanbar.org/reprint.

Manuscripts: Email manuscripts to david.gallacher@kutakrock.com. The

newsletter follows The Chicago Manual of Style (18th ed.) for the body text and

The Bluebook (21st ed.) for endnotes.

Editor in Chief: David Gallacher david.gallacher@kutakrock.com

Executive

Issue Editor: Taylor M. Menlove taylor.menl ove@rtx.com

Executive Editors: Alexander D. Canizares acanizares@perkinscoie.com

Taylor M. Menlove taylor.menl ove@rtx.com

Phillip R. Seckman phil.seckman@dentons.com

Associate

Issue Editors: Frank Murray murray@foley.com

Townsend Bourne tbourne@sheppardmullin.com

Associate Editors: Townsend Bourne tbourne@sheppardmullin.com

Robyn Burrows rburrows@blankrome.com

Adrianne Goins goinsadrianne@gmail.coml

Frank Murray fmurray@foley.com

Michael Schrier michael.schrier@huschblackwell.com

Judge Liz Witwer elizwitwer@gmail.com

ABA Publishing

Managing Editor: Susan Lorimor

Designer: Mary Anne Kulchawik

Copyright 2025 © American Bar Association

2 The Procurement Lawyer Winter 2025

Published in The Procurement Lawyer, Volume 60, Number 2, Winter 2025. © 2025 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion

thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

In light of the US Su-

preme Court’s decision in

Loper Bright Enterprises et

al. v. Raimondo, Secretary

of Commerce, et al.,1 which

overruled the long-stand-

ing precedent of Chevron,

U.S.A., Inc. v. NRDC,

Inc.,2 some in the govern-

ment contracts bar are her-

alding a new era of contract

disputes in which courts

will entertain requests to

invalidate regulations governing the federal govern-

ment’s acquisition of goods and services—specically,

provisions of the Federal Acquisition Regulation (FAR),

agency supplements such as the Defense Federal Ac-

quisition Regulation Supplement (DFARS), and the

Cost Accounting Standards (CAS)—that are incorpo-

rated as contract clauses into the terms and conditions

of government contracts.3 Those celebrating the demise

of Chevron predict that courts will uphold contractors’

challenges to agency interpretations of government con-

tracting regulations.4

In this article, after reviewing Chevron deference and

its application to government contracting regulations,

we explain why the Supreme Cour t’s conclusion in Loper

Bright—that court s should not defer to agency interpre-

tations of ambiguous statutes—is unlikely to affect gov-

ernment contract disp utes.5 First, in Loper Bright, the

The authors serve as attorneys with the Defense Contract Management

Agency (DCMA). The opinions expressed in this article are their

personal opinions and do not reect the views of the US Government,

the Department of Defense, or DCMA.

Supreme Court focused on a specic provision of the Ad-

ministrative Procedure Act (APA), which is not appli-

cable to the resolution of government contract disputes.

Second, courts should not apply the Court’s reasoning i n

Loper Bright to government contract disputes because the

policy considerations that arise when the government

promulgates regulations in its sovereign capacity, such

as the regulation at issue in Loper Bright, dif fer signi-

cantly from the policy consideration s that arise when the

government acts as a contracting partner. T hird, even if

courts were to entertain challenges to gover nment con-

tracting regulations in this new era, courts should con-

tinue to defer to regulations based on unambiguous stat-

utory delegations of rulemaking authorit y. Finally, Loper

Bright does not change the doctrine under which courts

defer to agency inter pretations of ambiguous regulations.

Chevron Deference and Its Application to Government

Contracting Regulations

Review of Chevron Deference

On June 28, 2024, the US Supreme Court decided Loper

Bright,6 overruling Chevron.7 To understand the impact

of the Loper Bright decision, it is necessary to rst under-

stand the Chevron decision.

In Chevron, the question presented to the Supreme

Court was whether the interpretation of the Clean Air

Act Amendments of 1977 by the Environmental Protec-

tion Agency (EPA), as reected in certain regulations,

was reasonable.8 The Court explained that in reviewing

an agency’s interpretation of a statute, the rst step is to

ask “whether Congress has directly spoken to the pre-

cise question at issue.”9 If Congress’s intent is clear, the

inquiry ends because “the court, as well as the agency,

must give effect to the unambiguously expres sed intent

Shining Light on Loper Bright: Why the Recent

Supreme Court Decision Leaves Government

Contracts Disputes Unchanged

BY MARIT D. BANK, KELLY A. DULGARIAN, ADRIANNE L. GOINS, JOSEPH P. MCCOOL, AND EDWARD R. MURRAY

Adrianne L. GoinsKelly A. DulgarianMarit D. Bank Joseph P. McCool

Edward R. Murray

Volume 60, Number 2 The Procurement Lawyer 3

Published in The Procurement Lawyer, Volume 60, Number 2, Winter 2025. © 2025 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion

thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.

of Congress.”10 The Court explained that Chevron def-

erence arose at a second step, only if “Congress had not

directly addressed the precise question at issue.”11 When

“the statute is silent or ambiguous” on the issue, a court

would determine “whet her the agency’s answer is based

on a permissible construction of the statute.”12 If the

agency’s inter pretation was reasonable, a court would

defer to the agency’s interpretation under the doctrine

that became known as “Chevron deference.” In Chev ron,

the Court explained that “considerable weight should be

accorded to an executive depart ment’s construction of

a statutory scheme it is entrusted to administer” and “a

court may not substitute its own construction of a statu-

tory provision for a reasonable [agency] interpretation.”13

The Court held that the interpretation of the statute by

the EPA wa s permissible because it was reasonable and

entitled to deference.14

Though the EPA promulgated the rules at issue in

Chevron under the procedures required by the APA,15

the Supreme Court did not rely on t he APA in creat-

ing the doctrine of Chevron deference.16 The Supreme

Court later explained that Chevron deferenc e applied

where “Congress delegated authority to the agency gen-

erally to make rules carrying the force of law” and the

agency followed formal procedures in doing so.17 Federal

court s employed Chevron deference to assess the valid-

ity of regulations promulgated under the APA and other

rulemaking procedures with similar notice-and-comment

requirements.18

Chevron Deference and Government Contracting Regulations

In deciding government contracts disputes, the US

Court of Appeals for the Federal Circuit, the US Court

of Federal Claims, and the boards of contract appeals ap-

plied Chevron deference and upheld government con-

tracting regulations incorporated into government

contracts when the court or board determined that

an agency’s interpretation of the relevant statute was

reasonable.19

For instance, the Federal Circuit applied Ch evron def-

erence to the cost disallowance provisions in t he FAR

known as the “cost principles.” The cost principles are

incorporated into government contr acts through the

FAR’s Allowable Cost and Payment Clau se.20 C ontract-

ing ofcers’ disallowances of costs under the cost prin-

ciples frequently lead to contract disputes with contrac-

tors. In Brownlee v. DynCorp, the Federal Circuit applied

Chevron deference to review the cost principle disallow-

ing reimbursement of a contractor’s legal costs related to

criminal proceedings.21 The court asked whether the in-

terpretation of the denition of “contractor” by the Sec-

retary of Defense was consistent with 10 U.S.C. § 2324,

the statute addressing allowable costs under defense con-

tracts, as amended by the Major Fraud Act of 1988.22

The Federal Circuit found the statute to be ambiguous.

Applying Chev ron deference, the court held that the

cost principle was a “reasonable interpretation” of the

statutory language.23 The court emphasized that “FAR

regulations are the very type of regulations that the Su-

preme Court in Chevron and later cases has held should

be afforded deference.”24

The Court of Federal Claims also accorded Chevron

deference to government contracting regulations.25 For

example, in AEY, Inc. v. United States, the court consid-

ered a DFARS clause prohibiting the contractor from ac-

quiring supplies “‘from a Communist Chinese military

company.’”26 Relying on Chevron , the court explained

that though the relevant statutory language was “open to

varying interpretations,” “the government’s interpreta-

tion . . . is entirely reasonable a nd well within the bound-

aries of the text.”27 The court held that because the

contractor breached the DFARS clause “explicitly incor-

porated” into the contract, the Army was entitled to ter-

minate for default.28

Like federal courts, the boards of contract appeals ap-

plied Chevron deference to determine whether agencies’

interpretations of statutes were per missible and there-

fore enfor ceable.29 For example, in Sundstrand Cor po-

ratio n, the Armed Services Board of Contract Appeals

(ASBCA) applied Ch evron deference in determining

that the FAR Council properly implemented provisions

of the Federal Acquisition St reamlining Act of 1994

when the FAR Council issued a standard contract clause

on installment payments under commercial contracts.30

With Ch evron deference eliminated by the Supreme

Court in Loper Br ight, the question becomes: W hat ef-

fect, if any, will Loper Bright have on judicial review of

FAR clauses and other regulations i ncorporated into

government contracts? As noted above, many commen-

tators pred ict that Loper Bright heralds a new era of chal-

lenges to government contracting regulations. For sever-

al reasons, we disagree.

The Loper Bright Decision Should Not Affect

Obligations Under Government Contracts

Loper Bright Is Based on the APA and Is Inapplicable to

Government Contracting Disputes

In Loper Bright, the Supreme Court focused on the

“Scope of Review” provision of the APA, 5 U.S.C.

§ 706, which provides the parameters for judicial review

of agency action under the APA. The Court’s decision is

explicitly based on the APA and grounded in the Court’s

reading of this provision in particular.

The petitioners in Loper Bright were commercial  sh-

ing companies subject to the Magnuson-Stevens Fishery

Conservation and Management Act (MSA).31 The MSA

allowed the National Marine Fi sheries Service to require

that “one or more observer s be carried on board” sh-

ing vessels “for the purpose of collecting data necessary

for the conservation and management of the shery.”32

The Service published a rule requiring that, where the

agency declined to provide a government-paid obser ver,

the companies were required to contract wit h and pay for

4 The Procurement Lawyer Winter 2025

Published in The Procurement Lawyer, Volume 60, Number 2, Winter 2025. © 2025 by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion

thereof may not be copied or disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association.