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Recently there have been some interesting developments in environmental and regulatory law, including litigation, administrative and regulatory actions, and legislation.  I’ve provided you with a little lite reading to ease into your week:roundup-300x227

Litigation

The Supreme Court will review a U.S. Court of Appeals for the D.C. Circuit decision, in NLRB v. Southwest General, Inc., regarding the Federal Vacancies Reform Act, which determines when nominees for agency positions can serve in those positions while their nominations are pending in the Senate. This case involves a controversy affecting that NLRB’s Acting General Counsel. Because of the lower court’s ruling, many administrative decisions were imperiled. It may also affect the actions of EPA’s Acting Deputy Administrator.

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In Supreme Court Validates “Implied Certification” Liability Under False Claims Act, sadwe and our colleague Danielle Vrabie discuss the U.S. Supreme Court’s June 16, 2016 decision in Universal Health Services, Inc. v. United States ex rel. Escobar, No. 15-7. The government contractor and health care communities had hoped the Court would use this case to narrow the scope of liability under the federal False Claims Act (FCA). That did not happen. Rather, a unanimous Court held that: (1) “implied certification” is a valid theory of liability under the FCA and (2) FCA liability for failing to disclose violations of legal requirements depends on the “materiality” of those requirements, not on whether those requirements were express conditions of payment. The Court’s holdings expand the scope of FCA liability previously recognized in several jurisdictions, resulting in a defeat for companies that sell to or seek reimbursement from the federal government.

Photo:  Pixel Addict, Depressed, May 21, 2007 – Creative Commons

 

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In Texas Extends ‘Accommodation Doctrine’ To Groundwater, I provide a broader analysis of the issue presented in my earlier blog When Contract is Silent, Accommodation Doctrine Applies to Water Rights Disputes. texaswater

Pillsbury summer associate Brittney Sandler made significant contributions to this article. Sandler is currently enrolled at Georgetown University Law Center where she serves as editor for the Georgetown Law Journal and as a legal research and writing fellow.

Photo: Greg Westfall, Just Another Day at the Park, Taken August 24, 2013 – Creative Commons

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On June 20, 2016, the U.S. District Court for the Northern District of California held, in Center for Environmental Health, et. al. v. Vilsack, that a United States Department of Agriculture (USDA) guidance document, intended to provide guidance with respect to the Organic Foods Act, was a legislative rule, not merely an interpretive statement of agency policy. The Act establishes the standards a product must satisfy to be labeled “organic.” The California Department of Food and Agriculture (CFDA) is certified by the USDA to administer the program in California, and in 2009, the California agency’s inspectors found detectable levels of bifenthrin in three compost products used in organic agricultural operations. Since the substance is not on a “National List” of approved synthetic substances, the USDA rules prohibit this use in compost products. In response to inquiries made by the manufacturer, the USDA issued the guidance document in question which allows the use of this substance under certain conditions.

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Pillsbury attorney Julia Judish provided commentary on the U.S. Supreme Court’s recent ruling in Encino Motorcars, LLC v. Navarro that vacated a Ninth Circuit ruling after holding that Department of Labor Fair Labor Standards Act regulations were not entitled to deference because they were issued without adequate explanation. In Attys React To High Court’s Auto Service Advisers OT Ruling, Judish stated:

“The Encino Motorcars decision will have little direct effect on the scope of FLSA overtime exemptions. The FLSA question presented in Encino — whether service advisers at auto dealerships are eligible for overtime — is unresolved. On remand, the Ninth Circuit will decide that question. The decision’s significance lies in its holding that an agency’s published regulations are not entitled to deference if the regulation departs from the agency’s long-standing prior interpretations, and if the agency has not published an explanation and analysis of its changed interpretation. Other published regulations may be subject to similar challenges.”

The Encino decision is but yet another recent decision calling into question whether deference is to be given to an agency’s rulemaking. The Chevron deference debate continues.

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In Supreme Court: the VA Must Apply the “Rule of Two” in all Contracting Decisions, VetAffairsPillsbury attorneys David Dixon and Dick Oliver discuss the U.S. Supreme Court’s June 16 unanimous ruling that the U.S. Department of Veterans Affairs (VA) must give preference to veteran-owned small businesses for all VA procurements as long as the requirements of the “Rule of Two” are met. This decision is expected to drastically alter the landscape for VA procurement. This ruling is Kingdomware Technologies, Inc. v. United States.

Photo:  JeffOnWire, Department of Veterans Affairs Motto, Taken November 16, 2014 – Creative Commons

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Chevron deference was an important factor in the U.S. Court of Appeals for the D.C. Circuit’s 180-page ruling, in United States Telecom Assoc. v. FCC, et al., on June 14 (Flag Day), upholding the Federal Communications Commission’s “Open Internet” rule. The Court of Appeals’ notes that “[f]or the third time in seven years, we confront an effort by the Federal Communications Commission to compel internet openness—commonly known as net neutrality—the principle that broadband providers must treat all internet traffic the same regardless of source.”

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In EPA Doubles Down with Expansive New Methane Regulation, Pillsbury attorneys Sheila McCafferty Harvey, David Lewis, Amanda Halter, Matthew Morrison, and Brendan Hennessey climatediscuss President Obama’s administration’s two recent, major steps in implementing its comprehensive climate change strategy. The Administration has set the first-ever methane emissions standards for new, reconstructed and modified sources and simultaneously begun a process to regulate existing methane emissions sources.

Photo:  Quenin Meulepas, Climate Rules!*, Taken March 23, 2008 – Creative Commons

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There are three types of bonds that afford financial protection in connection with a construction project: payment bonds, Cranesperformance bonds, and bid bonds. Below is a primer on the differences between these bonds and who is protected by them.

Construction Bonds

Construction bonds may be required by contract or by statute. Although often issued by an insurance company, these bonds are not insurance. Instead, the surety guarantees to the obligee (the entity to which the bond is issued) that the principal (the party who is supposed to perform) will meet its obligations. Most construction bonds require the principal to sign a guarantee. Thus, if an obligation is not met and the surety is required to pay a claim, the surety generally has the right to seek recovery from the principal.

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In FedRAMP Accelerates the Process for Federal Contractors to Obtain Cloud Service Provider Authorizations and DoD Revises its Cloud Computing Security Requirements Guide for FedRAMP+, Cloudmy colleague Selena Brady and I discuss cloud computing requirements for contractors in the federal market place. For those providing cloud services, it is a time of landmark changes.

Photo:  Daniel Boyd, Clouds, Taken June 29, 2010 – Creative Commons