A dispute involving the National Academies continues to test the suspension and debarment system

"It gets complicated when the president weighs in with an apparent conclusion or one that could be misread as an apparent conclusion," said David Robbins.

Interview transcript

Terry Gerton We have an interesting situation here. But before we do that, let’s talk about the institution who’s at the center of it, the National Academies of Science, Engineering and Medicine. They’re not a typical government contractor. What makes them different from most entities that might face suspension or debarment?

David Robbins Sure, happy to do that. I think let’s define suspension debarment briefly and then get to answer the question so people can follow. This is an odd hyper-technical area, but really one of increasing importance. Suspension debarments are ways to exclude government contractors and, relevant here, recipients of federal funds from further receipt of federal funds. There are two different rules. So, for your normal big contractors that we can all think about, they’re usually the federal acquisition regulation. This the non-procurement common rule that reaches into anybody that receives federal assistance money.

Terry Gerton And what then makes NASEM different here?

David Robbins What makes them different, in my mind, because they’re just doing their job, right? They’re largely going about their day publishing their data, doing what they need to do. And now we have the head of the executive branch, the president, telling the people who works for him, the debarring officials, to consider ending the federal funding. It’s a remarkable and unique series of events.

Terry Gerton And NASEM is actually a statutorily created organization chartered by Congress to help the federal government. Doesn’t that pose even a different conflict here?

David Robbins It makes it difficult. Speaking as a former debarring official, I don’t know how a career debarring official is going to deal with this call. I mean, when your boss publicly says this should be considered, obviously you have to consider it. But if the actions are taken pursuant to statute, it’s very hard to find a violation sufficient to exclude by suspension or debarment.

Terry Gerton Let’s come back to what you’ve implied here really is the core of the issue, though, is that the president has called for a debarment review for NASEM. What makes that really unusual under the suspension and debarments rules?

David Robbins It’s unusual because each individual federal agency, by and large, has their own delegated authority to a suspending debarring official who’s supposed to look at the facts, ground up. Do I see a problem? Do I have a cause for suspension debarment? Okay, shall I act? This jumps to the end. This is the boss of those individuals saying, you need to do this work. So it’s kind of hard to be able to have an objective review when your boss is saying, take a hard look and maybe leaning that maybe something should happen here. It puts the debarring officials in a bit of a bind.

Terry Gerton What was the incident that raised NASEM to the president’s perspective for this?

David Robbins What we’re seeing is an awful lot of effort by the federal government, by the executive branch to sweep in, I guess, words, things that could be misconstrued as topics the administration might consider in its view to be, I gues, “illegal DEI,” or any of those other sensitive topics for this administration. That may have caused this to bubble up. When you’re an organization that has to publish and there have been a lot of topics of interest. Naturally, there’ll be a lot of words out there that could be caught up in word searches or whatever that can cause these things to bubble up within the administration.

Terry Gerton And if this was initiated, as you said originally, from the bottom up as suspensions and debarments normally are, what would be the first indications that an action would be undertaken?

David Robbins Well, generally, when a review begins, the suspending debarring officials have two buckets of tools. First is an informal inquiry, a show cause notice, a request for information, an outreach short of something that precludes someone from receiving federal money. And that’s a nice informal exchange the public may never know about it because it’s not on any public list. Then there’s the formal interactions, suspension, temporary pause on funding, proposed debarment. In a civilian agency context doesn’t immediately propose debarment, but it imposes an administrative regulatory protocol process, and it’s part of a public record. So receipt of a formal or informal notice is the very short answer to your question.

Terry Gerton David Robbins is a partner at Jenner and Block. So David, let’s go back to NASEM. They’re an organization that works with a variety of federal agencies, under contract, under congressional direction sometimes. When a situation like this arises, who actually owns the process of the suspension and debarment and who would decide whether the case would move forward?

David Robbins As a general matter, the largest grant-making organization, the entity that gives the most money per year to this organization, or any contractor for that matter, is typically considered the lead agency. Only one agency can act for the federal government on debarment and has the full power of exclusion. So you can look at the largest source of grants, the large dollars, and find out, okay, this is the entity I’m going to be dealing with, and consider whether to reach out proactively or wait for a letter.

Terry Gerton And in this case, since the president seems to be moving it forward, does that change any aspect of which agency would have the lead?

David Robbins It shouldn’t, I mean it can, if an agency reaches out and says, yay verily, I want to take this on, and the other interested federal agencies say, go ahead and cede their authority. That is a possibility, but generally, it’s the largest source of dollars per year.

Terry Gerton David, in a situation like this, what would a typical organizational response be? They’ve sort of been put on notice that they’re being considered.

David Robbins A typical organization should take this very seriously. For all the reasons we’ve discussed. First, take a look at what may have set the president off and see if something can be done. Take down material that needs to be taken down, address any policies that need to be addressed, but also come up with a complete timeline of what’s happened. If it’s consistent, for example, like we’ve discuss with a statutory mission set and no one has done anything wrong, that could be a very important messaging tool going forward formally and informally on the debarment side and beyond.

Terry Gerton So you’re talking there sort of about building a historical case, walking through all the factual details, having them all at hand before there’s any formal action.

David Robbins Always a good idea, because there needs to be a violation, so to speak, that causes a debarment or a suspension. There has to be an enumerated problem. And if you control the facts and can explain why it’s not, what the government might perceive it as, you’ve got a leg up.

Terry Gerton So let’s assume that this actually becomes an official suspension and debarment action for NASEM. Some agency has taken it on. NASEM’s gathered all the facts, they have their case together, and the decision is made to debar. What are their options? Can they appeal it?

David Robbins There is an appeal to federal district court, Administrative Procedures Act, arbitrary capricious standard, and frankly, when you’re dealing with debarment for things like violations of free speech, for example, or constitutional rights are implicated, maybe there’s a good argument there. There’s also the informal request for reconsideration back to the debarring official. Given this dynamic, where the boss of the debarring official may have expressed a particular opinion, maybe court’s a better option. But those are the paths.

Terry Gerton So if we step back from this specific controversy, what lessons does this case offer about how suspension and debarment systems are supposed to work, especially when the pressure for debarment might originate outside the system?

David Robbins The purpose of suspension department enumerating regulations is not for the purpose of punishment, solely for protective purposes. It gets really complicated when the president weighs in with an apparent conclusion or one that could be misread as an apparent conclusion because that can blur those lines.

Terry Gerton So how, it starts again with that individual official down sort of at the ground level and it rises up?

David Robbins That’s the way it should work. That’s the way it worked when I was a suspending debarring official. And it was a lot easier then.

Terry Gerton Relative to, again, this specific case, what will you be watching for next? What developments would tell you whether this is just going to be a passing headline or whether there’s actually going to real official action?

David Robbins With this case and any case like it, I would watch two things. First, the system for award management at SAM.gov. Government contractors know it as the source for bidding opportunities. It also has an excluded parties list or exclusions list. That can show you in real time whether this case has advanced beyond a social media post and into an actual exclusion. And also I’d keep an eye on headlines, set up a headline search, see how involved Congress gets, because there are a couple of different factors here pressuring from both sides, and they’re both worth watching.

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