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The Arms Export Control Act provides the president with authority to transfer U.S. defense articles and services (including those related to construction) to friendly countries and allies. Under the Foreign Military Sales (FMS) program, the Department of Defense (DOD) procures the goods or services from the U.S. contractor on behalf of the foreign government recipient. Under the Foreign Military Financing (FMF) program, DOD provides grants — principally to Israel and Egypt — for the purchase of U.S. goods and services.

We have nearly 25 years of experience with both of these programs. In fact, we litigated and won the case that established the U.S. government's liability for U.S. contractor claims under FMS contracts.

Although FMS contracts are accordingly now considered virtually the same as any other DOD contract, some differences remain. We continue to counsel clients regularly in connection with agent fees, offset arrangements and costs, and other unique circumstances presented by FMS arrangements. For example, we successfully litigated a claim against the Air Force to recover coproduction costs incurred as a result of Turkey's direction to use an Egyptian subcontractor. 

Although limited to a handful of countries, the FMF program presents significant challenges to U.S. companies whose commercial contracts are financed under it. Instead of regulations, this program operates under a set of guidelines that are enforced through a "certification and agreement" each contractor must execute for the Defense Security Cooperation Agency (DSCA).

These policies are fraught with ambiguities, but since the United States is not a party to the underlying commercial contract, it often looks to the Civil False Claims Act to enforce them. We have extensive experience with each version of these guidelines, originally established in 1984, and with the DSCA officials who formulated them.

While the sensitivity of many matters precludes identification of specific representations, we have counseled and litigated dozens of matters involving some of the most troublesome areas:

  • Undisclosed non-U.S. content
  • Payment of contingent fees (including to employees)
  • Improper use of advance payments
  • In-country support costs

View More

"Fastest 5 Minutes: DOJ's Antitrust Strike Force (November 12)," Podcast: Fastest 5 Minutes in Government Contracts (November 12, 2019). Contacts: Gail D. Zirkelbach, David B. Robbins
Client Alert/Newsletter
Bid Protests, Suspension And Debarments Continue to Drop, But For How Long? Federal News Network (November 11, 2019)
In the News
"GAO Bid Protest Statistics for FY2019," Government Contracts Bullet Points (November 8, 2019). Contacts: Robert J. Sneckenberg, Anuj Vohra
Client Alert/Newsletter
Crowell & Moring Partner David Robbins on Procurement Fraud Mandatory Disclosure And Suspension and Debarment Corporate Crime Reporter (November 8, 2019)
In the News
"Annual ISDC Reporting," Government Contracts Bullet Points (November 7, 2019). Contacts: David B. Robbins, Peter Eyre, Laura J. Mitchell Baker
Client Alert/Newsletter
"Legal Landmines in Proposal Drafting," Government Contracts Breakfast Series, Herndon, VA (November 6, 2019). Panelists: Christian N. Curran, Olivia Lynch, and Robert J. Sneckenberg.
"Fastest 5 Minutes: DOL Enforcement, FCA, and VA Data Security News (November 1)," Podcast: Fastest 5 Minutes in Government Contracts (November 1, 2019). Contacts: David B. Robbins, Peter Eyre
Client Alert/Newsletter
An Insider's Guide To Avoiding Procurement Fraud Federal Computer Week (October 31, 2019)
In the News
"Approved: E-Signatures for CDA Claim Certifications Receive the ASBCA’s Stamp of Approval," Government Contracts Bullet Points (October 30, 2019). Contacts: Stephen J. McBrady, Skye Mathieson, Michelle D. Coleman
Client Alert/Newsletter
"Anatomy of a Procurement Fraud Investigation," Crowell and Moring Training, Washington, D.C. (October 29, 2019). Presenters: David B. Robbins and Gail D. Zirkelbach.

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Crowell & Moring LLP is an international law firm with more than 500 lawyers representing clients in litigation and arbitration, regulatory, and transactional matters. The firm is internationally recognized for its representation of Fortune 500 companies in high-stakes litigation, as well as its ongoing commitment to pro bono service and diversity. The firm has offices in Washington, DC, New York, Los Angeles, San Francisco, Orange County, London, and Brussels.

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