Companies working on federally funded projects often have significant legal disputes with other project participants or federal agencies over issues such as breaches of contract, regulatory non-compliance, and alleged fraud. Experienced legal counsel can help companies reduce the risk of disputes during federally funded projects and navigate potential litigation.
Common Causes of Litigation
Some of the most frequent cases of litigation in federally funded projects include:
- Contract disputes: Federally funded projects can have contract disputes that arise from the bidding and procurement process when losing bidders choose to contest the selection process. Contract disputes may also include breach of contract claims between contractors and subcontractors or between prime contractors and federal agencies.
- Regulatory compliance issues: Litigation can arise over claims of non-compliance with applicable federal regulations, including labor, environmental, or civil rights laws.
- Fraud/false claims: Businesses involved in federally funded projects can face False Act Claims filed by alleged whistleblowers claiming that project participants made misrepresentations in bidding documents or submitted fraudulent payment claims.
- Project delays and cost overruns: Federal agencies or project participants may file suit to allege contract breaches due to delays and cost overruns. Contractors may also dispute responsibility for alleged project delays and increased costs.
Key Legal Considerations
A company involved in a federally funded project that faces the potential of litigation must evaluate various legal considerations when deciding how to resolve the dispute. Key legal considerations in litigation arising from federally funded projects include:
- Jurisdictional issues: Businesses that face litigation arising from a federally funded project should understand their options for jurisdiction over the dispute, including the possibility or obligation to litigate a case in state or federal court.
- Statutory/regulatory frameworks: Companies must familiarize themselves with the federal statutes and regulations that may apply to their work on a federally funded project, including federal bidding rules, employment/labor regulations, and anti-discrimination laws.
- Role of federal agencies: Companies should remain cognizant of the possibility that federal agencies may become involved in legal disputes or litigation that arise from federally funded projects. Agencies may exercise oversight to enforce applicable laws and regulations and protect the public’s interests in the project’s funding.
Strategies for Mitigating Litigation Risks
Critical strategies that companies can follow to reduce their litigation risks when participating in federally funded projects include:
- Adopting comprehensive compliance programs and audit procedures to ensure that companies follow applicable federal regulations and statutes
- Careful contract negotiations and drafting to create clear, thorough agreements that reduce the risk of ambiguities or confusion that can lead to litigation
- Effective communication throughout the project to identify issues before they grow into significant disputes that turn into litigation
- Having experienced legal representation throughout each phase of the project and any litigation that may arise
Contact a Litigation Attorney to Learn More
Not all attorneys are admitted to practice in the Federal Court of Claims, where claims against the federal government are litigated. Gary August of August Law is admitted in this Washington, DC, Court. If you have a legal dispute arising from a government contract or federally funded project, you need legal counsel experienced in complex federal government contracts to protect your rights and interests. Contact August Law today for a confidential consultation with our legal team to discuss your options for pursuing a favorable resolution to litigation involving a federally funded project.