What's good for the goose and the gander.

• Author: McGrath, III, Dorn C.
• Position: ETHICS CORNER

The federal government has long imposed unique ethical responsibilities on its employees. Recent convictions surrounding former U.S. Rep. Duke Cunningham's activities and those of Air Force procurement executive Darlene Druyun show that egregious misconduct by public officials will demand punishment under any standard.

When government conduct did not rise, however, to the level of a crime, contractors who raised ethical issues or issues of good faith in procurement law matters for decades were met with a burdensome legal presumption that government employees can do no wrong.

The sometimes-overreaching assumption that the government always acts in good faith is no longer indisputably the law. Recent court decisions have altered the legal "good faith" presumption that traditionally protected the government and forced contractors to overcome an almost insurmountable burden of proof to show that the government, in fact, had dealt unfairly or unethically in contract or procurement matters.

Previously in government contracts litigation, government contractors charging bad faith by the government needed "well-nigh irrefragable proof" to overcome the strong presumption that government officials always act in good faith. This heavy standard meant contractors alleging bad-faith action or inaction, essentially had to show malice or a specific intent by a government official to injure the contractor. Whether the issue was a government failure to cooperate with the contractor in performance, a termination for default or a claim against the contractor, any improper government conduct was protected by a heavy standard of proof that never shifted the onus back to the government to justify highly questionable conduct.

Recently, faced with conduct that raised serious questions of whether the government was treating contractors fairly, several courts have revisited the historical assumption that the government always acts in good faith. While all courts have not yet adopted a more balanced standard, the trend is pointed very clearly in that direction. This trend is important for contractors contemplating litigation that includes issues of bad faith by government officials.

For instance, in one case, Tecom Inc. v. U.S., the government reportedly threatened the contractor that if it did not stop documenting the condition of government vehicles--a contract requirement--the government would "kill" the project. The contractor sued, alleging that the government's...