10 CFR Part 719

10 CFR Part 719 (up to date as of 4/24/2025)
Contractor Legal Management Requirements

10 CFR Part 719 (Apr. 24, 2025)

This content is from the eCFR and is authoritative but unofficial.

Title 10 —Energy
Chapter III —Department of Energy
Part 719 Contractor Legal Management Requirements
Subpart A General Provisions
§ 719.1 What is the purpose of this part?
§ 719.2 What are the definitions of terms used in this part?
§ 719.3 What contracts are covered by this part?
§ 719.4 Are law firms that are retained by contract by the Department covered by this part?
§ 719.5 What contracts are not covered by this part?
§ 719.6 Are there any types of legal matters not included in the coverage of this part?
§ 719.7 Is there a procedure for exceptions or deviations from this part?
§ 719.8 Does the provision of protected documents from the contractor to the Department
constitute a waiver of privilege?
Subpart B Legal Management Plan, Staffing and Resource Plan and Annual Legal
Budget
§ 719.10 Who must submit a Legal Management Plan?
§ 719.11 When must a Legal Management Plan be submitted or revised?
§ 719.12 What information must be included in the Legal Management Plan?
§ 719.13 Who at the Department receives and reviews the Legal Management Plan?
§ 719.14 Will the Department notify the contractor concerning the adequacy or inadequacy of
the submitted Legal Management Plan?
§ 719.15 What are the requirements for a Staffing and Resource Plan?
§ 719.16 When must the Staffing and Resource Plan be submitted?
§ 719.17 Are there any budgetary requirements?
Subpart C Engagement Letter
§ 719.20 When must an engagement letter be submitted to Department Counsel?
§ 719.21 What are the required elements of an engagement letter?
Subpart D Requests From Contractor Counsel To Initiate, Defend, and Settle Legal
Matters
§ 719.30 In what circumstances may the contractor initiate litigation, including appeals from
adverse decisions?
§ 719.31 When must the contractor initiate litigation against third parties?
§ 719.32 What must the contractor do when it receives notice that it is a party to litigation?
§ 719.33 In what circumstances must the contractor seek permission from the Department to
enter a settlement agreement?
§ 719.34 What documentation must the contractor provide to Department Counsel when it
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§ 719.35
Subpart E
§ 719.40
§ 719.41
§ 719.42
§ 719.43
§ 719.44
§ 719.45
§ 719.46
§ 719.47
Subpart F
§ 719.50
§ 719.51
§ 719.52

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seeks permission to enter a settlement agreement?
When must the contractor provide a copy of an executed settlement agreement?
Reimbursement of Costs Subject to This Part
What effect do the regulations of this part have on cost allowability?
How does the Department determine whether fees are reasonable?
What categories of costs are unallowable?
What is the treatment of travel costs?
What categories of costs require advance approval?
Are there any special procedures or requirements regarding subcontractor and
retrospective insurance carrier legal costs?
Are costs covered by this part subject to audit?
What happens when more than one contractor is a party to a matter?
Department Counsel
What authority does Department Counsel have?
What information must be forwarded to the General Counsel's Office concerning
contractor submissions to Department Counsel under this part?
What types of field actions must be coordinated with the General Counsel?

Appendix A to Part 719
Guidance for Legal Resource Management

PART 719—CONTRACTOR LEGAL MANAGEMENT REQUIREMENTS
Authority: 42 U.S.C. 2201, 5814, 5815 and 7101, et seq.; 50 U.S.C. 2401, et seq.
Source: 78 FR 25809, May 3, 2013, unless otherwise noted.

Subpart A—General Provisions
§ 719.1 What is the purpose of this part?
This part facilitates management of retained legal counsel and contractor legal costs, including litigation and legal
matter costs. It requires the contractor to develop a Legal Management Plan, to document the analysis used to
decide when to utilize outside counsel, and to document what law firm or individual attorney will be engaged as
outside counsel. This part also requires the contractor to document the terms of the engagement with retained
legal counsel. Payment of Department-retained law firm invoices and reimbursement of contractor legal costs
under covered contracts are subject to compliance with this part.

§ 719.2 What are the definitions of terms used in this part?
For purposes of this part:
Alternative dispute resolution includes, but is not limited to, processes such as mediation, neutral evaluation,
mini-trials and arbitration.
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10 CFR 719.2 “Contractor”

Contractor means any person or entity with whom the Department contracts for the acquisition of goods or
services.
Covered contracts means those contracts described in § 719.3 of this part.
Days means calendar days.
Department means the Department of Energy (DOE), including the National Nuclear Security Administration
(NNSA).
Department Counsel means the attorney in the DOE or NNSA field office, or Headquarters office, designated as
the contracting officer's representative and point of contact for a contractor or for Department retained
legal counsel, for purposes of this part.
General Counsel means the DOE General Counsel for DOE legal matters and the NNSA General Counsel for
NNSA legal matters.
Legal costs means, but is not limited to, administrative expenses associated with the provision of legal services
by retained legal counsel; the costs of legal services provided by retained legal counsel; the costs of the
services, if the services are procured in connection with a legal matter, of accountants, consultants,
experts or others retained by the contractor or by retained legal counsel; and any similar costs incurred by
retained legal counsel or in connection with the services of retained legal counsel.
Legal Management Plan means a document required by subpart B of this part describing the contractor's
practices for managing legal costs and legal matters for which it procures the services of retained legal
counsel.
Litigation means a proceeding arising under or related to a contract between the contractor and the Department
to which the contractor is a party in a State, tribal, territorial, foreign, or federal court or before an
administrative body or an arbitrator.
Retained legal counsel means a licensed attorney working in the private sector who is retained by a contractor or
the Department to provide legal services.
Retrospective insurance means any insurance policy under which the premium is not fixed but is subject to
adjustments to reimburse the insurance carrier for actual losses incurred or paid (e.g. claims,
settlements, damages, and legal costs). Retrospective insurance includes service-type insurance policies
as described in 48 CFR 928.370.
Settlement agreement means a written agreement between a contractor and one or more parties pursuant to
which one or more parties waives the right to pursue a legal claim in exchange for something of value.
Significant matters means legal matters involving significant issues as determined by Department Counsel and
identified to a contractor in writing, and any legal matters where the amount of any legal costs, over the
life of the matter, is expected to exceed $100,000.
Staffing and Resource Plan means a statement prepared in accordance with subpart B of this part by retained
legal counsel that describes the method for managing a Significant Matter in litigation.

§ 719.3 What contracts are covered by this part?
(a) Unless excluded under § 719.5, this part covers the following three categories of contracts:
(1) All management and operating contracts;
(2) Non-management and operating cost reimbursement contracts exceeding $100,000,000; and
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(3) Non-management and operating contracts exceeding $100,000,000 that include cost reimbursable
elements exceeding $10,000,000 (e.g., contracts with both fixed-price and cost-reimbursable line
items where the cost-reimbursable line items exceed $10,000,000 or time and materials contracts
where the materials portions exceed $10,000,000).
(b) This part also covers contracts otherwise not covered by paragraph (a) of this section but which contain a
clause requiring compliance with this part.
(c) This part also covers any contract the Department awards directly to retained legal counsel exceeding
$100,000.

§ 719.4 Are law firms that are retained by contract by the Department covered by this part?
Legal counsel retained under fixed rate or other type of contract or other agreement by the Department to provide
legal services must comply with the following if the legal costs over the life of the matter for which counsel has
been retained are expected by the Department to exceed $100,000 and retained legal counsel are so notified by the
Department:
(a) Requirements related to Staffing and Resource Plans in subpart B of this part;
(b) Cost guidelines in subpart E of this part; and
(c) Engagement letter requirements in subpart C of this part if the retained legal counsel subcontracts legal
work valued at $25,000 or more (e.g., a law firm retained by the Department subcontracts with another
law firm to provide $26,000 in discovery-related legal work).

§ 719.5 What contracts are not covered by this part?
This part does not cover any contract under which the Department is not responsible for directly reimbursing the
contractor for legal costs, such as fixed price contracts.

§ 719.6 Are there any types of legal matters not included in the coverage of this part?
Legal matters not covered by this part include:
(a) Matters handled by counsel retained by an insurance carrier, except under retrospective insurance in
accordance with § 719.45;
(b) Routine intellectual property law support services; and
(c) Routine workers and unemployment compensation matters.

§ 719.7 Is there a procedure for exceptions or deviations from this part?
(a) Requests for exceptions or deviations from this part must be made in writing to Department Counsel and
approved by the General Counsel. If an alternate procedure is proposed for compliance with an individual
requirement in this part, that procedure must be included in the written request by the contractor. The
General Counsel or his/her delegee shall provide a written response to such requests; however the
response shall not require a justification of the Department's exercise of its discretion.
(b) The General Counsel may authorize exceptions or deviations requested under paragraph (a) of this
section. The General Counsel may also establish exceptions to this part based on current field office and
contractor practices that satisfy the purpose of these requirements.
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10 CFR 719.7(c)

(c) Exceptions to this part that are also a deviation from the Department of Energy Acquisition Regulation
(DEAR) cost principles (see subpart D of this part) must be approved in accordance with applicable DOE
procurement policy. See, e.g., DOE Acquisition Guide chapter 1.1, requiring approval by the Senior
Procurement Executive of DOE or NNSA as applicable. In any event, the written request from a contractor
for a deviation from a cost principle relating to this part must be submitted to the contracting officer, with
a copy provided to Department Counsel.

§ 719.8 Does the provision of protected documents from the contractor to the Department
constitute a waiver of privilege?
Contractors are required to provide detailed information about third-party claims and litigation to the Department.
The Department and its contractors typically share common legal and strategic interests relating to pending or
threatened litigation. The common interest between the parties is primarily rooted in the fact that the Department
reimburses contractors for allowable costs incurred when litigation is threatened or initiated against contractors.
However, other sources of the common interest between the Department and its contractors may include, but are
not limited to, an interest in completion of the agency's important mission work and an interest in safe and efficient
operation of the Department's facilities. To the extent documents associated with compliance with this part (e.g.,
Staffing and Resource Plans, invoices, engagement letters, settlement authority requests, and draft pleadings) are
protected from disclosure to third parties because the items constitute attorney work product and/or involve
attorney client communications, the contractor's provision of these items to the Department does not constitute a
waiver of privilege. As long as the Department and the contractor share a common interest in the outcome of legal
matters, this mutual legal interest permits the parties to share privileged material without waiving any applicable
privilege.

Subpart B—Legal Management Plan, Staffing and Resource Plan and Annual Legal Budget
§ 719.10 Who must submit a Legal Management Plan?
Contractors who are parties to contracts identified under § 719.3(a) and (b) must submit a Legal Management Plan.

§ 719.11 When must a Legal Management Plan be submitted or revised?
(a) Contractors must submit a Legal Management Plan to Department Counsel within 60 days following
award of the contract. The deadline for submitting the Legal Management Plan may be extended by
Department Counsel.
(b) Contractors must submit a revised Legal Management Plan upon request of Department Counsel within
60 days of receipt of the Department Counsel's request. The request for a revised Legal Management
Plan shall include an explanation of the request. The deadline for submitting the Legal Management Plan
may be extended by the Department Counsel.

§ 719.12 What information must be included in the Legal Management Plan?
The Legal Management Plan must include the following items:
(a) A description of the contractor's in-house counsel resources at the time the Legal Management Plan is
submitted, including areas of expertise and an explanation of the types of matters expected to be handled
in-house.
(b) A description of the legal matters that may necessitate engagement of retained legal counsel.

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10 CFR 719.12(c)

(c) A description of the factors the contractor will consider in determining whether to handle a particular
matter utilizing retained legal counsel.
(d) An outline of the factors the contractor must consider in selecting retained legal counsel, including:
(1) Cost;
(2) Past performance of previously retained counsel;
(3) Particular expertise in a specific area of the law;
(4) Familiarity with the Department's activity at the particular site and the prevalent issues associated
with facility history and current operations;
(5) Location of retained legal counsel relative to:
(i)

The site involved in the matter,

(ii) Any forum in which the matter will be processed, and
(iii) The location where a significant portion of the work will be performed;
(6) Experience as an advocate in alternative dispute resolution procedures such as mediation;
(7) Actual or potential conflicts of interest; and
(8) The means and rate of compensation (e.g., hourly billing, fixed fee, blended fees).
(e) A description of the system that the contractor will use to review each matter in litigation to determine
whether and when alternative dispute resolution is appropriate.
(f) A description of the role of in-house counsel in cost management.
(g) A description of the contractor's process for review and approval of invoices for legal costs.
(h) A description of the contractor's strategy for interaction with, and supervision of, retained legal counsel.
(i)

A description of the procedures the contractor will employ in order to seek timely approval from
Department Counsel to settle any legal matters as required by § 719.34 of this part;

(j)

A description of the contractor's strategy for keeping Department Counsel apprised of all legal matters
covered by this part (e.g., regularly scheduled meetings and written communications).

§ 719.13 Who at the Department receives and reviews the Legal Management Plan?
Contractors must submit a Legal Management Plan to Department Counsel. If the contractor has not been notified
of the assignment of Department Counsel, the contractor must submit the Legal Management Plan to the
contracting officer and the DOE Deputy General Counsel for Litigation and Enforcement or the NNSA Deputy General
Counsel as appropriate.

§ 719.14 Will the Department notify the contractor concerning the adequacy or inadequacy of
the submitted Legal Management Plan?
The Contracting Officer or Department Counsel will notify the contractor of any non-compliance or inadequate
information relating to requirements in § 719.12 within 30 days of the contractor's submission of the plan. The
contractor must either correct matters identified within 30 days of notification or file a letter with the General
Counsel disputing the determination of a deficiency.
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10 CFR 719.15

§ 719.15 What are the requirements for a Staffing and Resource Plan?
(a) For significant matters in litigation, the contractor must require retained legal counsel to prepare a Staffing
and Resource Plan. The contractor must then forward the Staffing and Resource Plan to Department
Counsel.
(b) Retained legal counsel retained directly by the Department subject to this part must prepare a Staffing and
Resource Plan and forward it to Department Counsel.
(c) A Staffing and Resource Plan must describe the following:
(1) Major phases likely to be involved in the handling of the matter;
(2) Timing and sequence of such phases;
(3) Projected cost for each phase of the representation; and
(4) Detailed description of resources that the retained legal counsel intends to devote to the
representation.
(d) A Staffing and Resource Plan must include a budget, broken down by phases, including at a minimum the
following phases:
(1) Matter assessment, development and administration;
(2) Pretrial pleadings and motions;
(3) Discovery;
(4) Trial preparation and trial; and
(5) Appeal.
(e) The contractor must notify Department Counsel before incurring retained legal counsel costs in excess of
costs listed in the budget developed pursuant to paragraph (d) of this section.

§ 719.16 When must the Staffing and Resource Plan be submitted?
(a) The contractor or retained legal counsel must submit the Staffing and Resource Plan to Department
Counsel within 30 days after the filing of an answer or a dispositive motion in lieu of an answer, 30 days
after a determination that the cost is expected to exceed $100,000, or 30 days after notification from
Department Counsel that a matter is considered significant, whichever is sooner. The deadline for
submitting the Staffing and Resource Plan may be extended by Department Counsel.
(b) Department Counsel may state objections to the Staffing and Resource Plan within 30 days of receipt of a
Staffing and Resource Plan. When an objection is stated, the contractor or retained legal counsel must
either revise the Staffing and Resource Plan to satisfy the objection within 30 days or file a letter with the
General Counsel disputing the objection.
(c) Contractors must require retained legal counsel to update Staffing and Resource Plans annually or more
frequently if there are significant changes in the matter. The contractor must submit the Staffing and
Resource Plan updates to Department Counsel. Similarly, Department retained legal counsel must submit
to Department Counsel annual Staffing and Resource Plan updates or more frequent updates if there are
significant changes in the matter.

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§ 719.17 Are there any budgetary requirements?
(a) Contractors required to submit a Legal Management Plan must also submit an annual legal budget to
Department Counsel.
(b) The annual legal budget must include cost projections for significant matters at a level of detail reflective
of the types of billable activities and the stage of each such matter.
(c) For informational purposes for both the contractor and Department Counsel, the contractor must submit a
report to Department Counsel comparing its budgeted and actual legal costs within 30 days of the
conclusion of the period covered by each annual legal budget. The Department recognizes, however, that
there may be departures from the annual budget beyond the control of the contractor.

Subpart C—Engagement Letter
§ 719.20 When must an engagement letter be submitted to Department Counsel?
Contractors must submit a copy of an executed engagement letter between it and retained legal counsel to
Department Counsel when the retained counsel is expected to provide $25,000 or more in legal services for a
particular matter. A copy of the executed engagement letter must be submitted to Department Counsel upon
execution.

§ 719.21 What are the required elements of an engagement letter?
(a) The engagement letter must require retained legal counsel to assist the contractor in complying with this
part and any supplemental guidance distributed under this part.
(b) At a minimum, the engagement letter must include the following:
(1) A process for review and documented approval of all billing by a contractor representative including
the timing and scope of billing reviews.
(2) A statement that provision of records to the Government is not intended to constitute a waiver of any
applicable legal privilege, protection, or immunity with respect to disclosure of these records to third
parties. An exemption for specific records may be obtained where contractors can demonstrate that
a particular situation may provide grounds for a waiver.
(3) A requirement that the contractor, the Department, and the Government Accountability Office have
the right, upon request, and at reasonable times and locations to inspect, copy, and audit all records
documenting billable fees and costs.
(4) A statement that all records must be retained for a period of six (6) years and three (3) months after
the final payment or after final case disposition, whichever is later.
(5) Identification of all attorneys and staff who are assigned to the matter and the rate and basis of their
compensation (i.e., hourly rates, fixed fees, contingency arrangement) and a process for obtaining
approval of temporary adjustments in staffing levels or identified attorneys.
(6) An initial assessment of the matter by retained legal counsel, along with a commitment to provide
updates as necessary.
(7) A description of billing procedures, including frequency of billing and billing statement format.

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10 CFR 719.21(b)(8)

(8) A statement setting forth an agreement that the retained legal counsel will prepare a Staffing and
Resource Plan in accordance with the requirements of § 719.15.
(9) A statement setting forth an agreement to consider alternative dispute resolution at the earliest
possible stage and thereafter as appropriate where litigation is involved.
(10) A statement setting forth an agreement that retained legal counsel must comply with the cost
guidelines in subpart E of this part.
(11) A statement setting forth an agreement that retained legal counsel will provide a certification
concerning the costs submitted for reimbursement. The certification that must be included in bills or
invoices submitted by retained legal counsel must appear as follows: “Under penalty of law, [the
representative] acknowledges the expectation that the bill will be paid by the contractor and that the
contractor will be reimbursed by the Federal Government through the U.S. Department of Energy,
and, based on personal knowledge and a good faith belief, certifies that the bill is truthful and
accurate, and that the services and charges set forth herein comply with the terms of engagement
and the policies set forth in the Department of Energy's regulation and guidance on contractor legal
management requirements, and that the costs and charges set forth herein are appropriate and
related to the representation of the client.” The certification must be signed and dated by a
representative of the retained legal counsel. Invoices must contain all elements (e.g., date of service,
description of service, name of attorney, etc.) set forth in the model bill format in Appendix A to this
part.
(12) A statement setting forth agreement to identify and address promptly any professional conflicts of
interest.
(c) There may be additional requirements for an engagement letter based on the needs of the contractor or
the Departmental element requiring the services of the Department retained legal counsel.

Subpart D—Requests From Contractor Counsel To Initiate, Defend, and Settle Legal Matters
§ 719.30 In what circumstances may the contractor initiate litigation, including appeals from
adverse decisions?
(a) The contractor must provide written notice to Department Counsel prior to initiating litigation or appealing
from adverse decisions.
(b) The contractor may not initiate litigation for which it seeks reimbursement without prior written
authorization of Department Counsel.
(c) The following information must be provided to Department Counsel by the contractor prior to initiating
litigation or appealing an adverse decision:
(1) Identification of the proposed parties;
(2) The nature of the proposed action;
(3) Relief sought;
(4) Venue;
(5) Proposed representation and reason for selection;

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(6) An analysis of the issues and the likelihood of success, and any time limitation associated with the
requested approval;
(7) The estimated costs associated with the proposed action, including whether outside counsel has
agreed to a contingent fee arrangement;
(8) Whether, for any reason, the contractor will assume any part of the costs of the action;
(9) A description of any attempts to resolve the issues that would be the subject of the litigation, such
as through mediation or other means of alternative dispute resolution; and
(10) A discussion regarding why initiating litigation would prove beneficial to the contractor and to the
Department.

§ 719.31 When must the contractor initiate litigation against third parties?
The contractor must initiate litigation, upon the request of the contracting officer, against third parties including
proceedings before administrative agencies, in connection with the contract. The contractor shall proceed with
such litigation in good faith and as directed from time to time by Department Counsel.

§ 719.32 What must the contractor do when it receives notice that it is a party to litigation?
(a) The contractor shall give the contracting officer and Department Counsel immediate notice in writing of
any legal proceeding, including any proceeding before an administrative agency and any claim which will
be handled by a retrospective insurance carrier if costs (including Legal costs, settlements, claims paid,
damages, etc.) are likely to be $100,000 or more, filed against the contractor arising out of the
performance of the contract and shall provide a copy of all relevant filings and any other documents that
may be requested by the contracting officer and/or Department Counsel. The Department Counsel will
direct the contractor as to:
(1) Whether the contractor must authorize the Government to defend the action;
(2) Whether the Government will take charge of the action; or
(3) Whether the Government must receive an assignment of the contractor's rights.
(b) The contractor shall proceed with such litigation in good faith and as directed from time to time by the
Department Counsel.
(c) If the costs and expenses associated with the legal proceeding against the contractor are potentially
allowable under the contract, the contractor shall:
(1) Authorize Department representatives to collaborate with contractor in-house counsel or Department
Counsel-approved outside counsel in settling or defending the legal proceeding; or counsel for any
associated insurance carrier in settling or defending the claim if retrospective insurance applies or
the amount of liability claimed exceeds the amount of insurance coverage; and
(2) Authorize Department representatives to settle the legal proceeding or to defend or represent the
contractor in and/or to take charge of any litigation, if required by the Department, except where the
liability is covered by bond or is insured by an insurance policy other than retrospective insurance.

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10 CFR 719.33

§ 719.33 In what circumstances must the contractor seek permission from the Department to
enter a settlement agreement?
The contractor must obtain permission from Department Counsel to enter a settlement agreement if the settlement
agreement requires contractor payment of $25,000 or more. Obtaining this approval does not represent a
determination that the settlement amount and/or the legal costs incurred in connection with the underlying legal
matter will be determined to be allowable.

§ 719.34 What documentation must the contractor provide to Department Counsel when it
seeks permission to enter a settlement agreement?
The contractor must provide a written statement to the Department Counsel that includes the following information,
as applicable:
(a) The amount of any proposed monetary settlement payment.
(b) Titles and docket numbers associated with the case(s) for which the contractor is seeking approval to
settle;
(c) The procedural history of the case(s) or issue(s);
(d) A narrative description of the legal claims or allegations at issue in the matter and any background
information that explains events that precipitated the initiation of the matter;
(e) A description of the history of the settlement discussions;
(f) A description of the terms of the proposed settlement agreement or requested settlement authority and
the rationale for the contractor entering into the proposed agreement;
(g) If the proposed total monetary settlement amount would be allocated among multiple plaintiffs, a list of
the plaintiffs and the amount of money each would receive pursuant to the proposed settlement
agreement as well as an explanation as to why the settlement amount is different for any particular
plaintiff, if appropriate;
(h) A description as to why settlement of the matter is in the best interest of the Department; and
(i)

Any additional supporting documents requested by Department Counsel.

§ 719.35 When must the contractor provide a copy of an executed settlement agreement?
A contractor must provide a copy of an executed settlement agreement within seven (7) days of execution.

Subpart E—Reimbursement of Costs Subject to This Part
§ 719.40 What effect do the regulations of this part have on cost allowability?
Contractor and retained legal counsel compliance with this part is a prerequisite for allowability of legal costs.
However, compliance with this part does not guarantee that legal costs will be determined to be allowable. Only the
contracting officer has the authority to determine allowability of costs in accordance with 48 CFR (FAR) part 31 and
(DEAR) part 931 and all other applicable contract terms and conditions.

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10 CFR 719.41

§ 719.41 How does the Department determine whether fees are reasonable?
In determining whether fees or rates charged by retained legal counsel are reasonable, the Department may
consider among other things:
(a) Whether the lowest reasonably achievable fees or rates (including any currently available or negotiable
discounts) were obtained from retained legal counsel;
(b) Whether lower rates from other firms providing comparable services, at appropriate competency and
experience levels, were available;
(c) Whether alternative rate structures such as flat, contingent, and other innovative proposals, were
considered; and
(d) The complexity of the legal matter and the expertise of the law firm in this area.

§ 719.42 What categories of costs are unallowable?
(a) Specific categories of unallowable costs are contained in the cost principles at 48 CFR (FAR) part 31 and
48 CFR (DEAR) part 931 and 48 CFR 970.31. See also 41 U.S.C. 4304.
(b) Costs that are customarily or already included in billed hourly rates are not separately reimbursable.
(c) Interest charges that a contractor incurs on any outstanding (unpaid) bills from retained legal counsel are
not reimbursable.

§ 719.43 What is the treatment of travel costs?
(a) Travel and related expenses must at a minimum comply with the restrictions set forth in 48 CFR
31.205-46, or 48 CFR (DEAR) 970.3102-05-46, as appropriate, to be reimbursable.
(b) Travel time may be allowed at a full hourly rate for the portion of time during which retained legal counsel
performs legal work for which it was retained; any remaining travel time shall be reimbursed at 50 percent
of the full hourly rate, except that in no event will travel time spent working for other clients be allowable.
Also, for long distance travel that could be completed by various methods of transportation, e.g., car, train,
or plane, costs charged by retained legal counsel or any agent of retained legal counsel will be considered
reasonable only if the individuals charge no more travel time than it would take to utilize the fastest mode
of transportation that is cost-effective. For example, if retained legal counsel travels for 10 hours by train
when a cost-effective flight that would take two hours to get to the same destination is available, the
attorney may charge a maximum of two hours for the time spent traveling.

§ 719.44 What categories of costs require advance approval?
(a) To be considered for reimbursement, costs incurred by retained legal counsel for the following require
advance written approval from Department Counsel or the submission of subsequent specific justification
to Department Counsel when circumstances out of the contractor's control make advance approval
unobtainable:
(1) Computers or general application software, or non-routine computerized databases, if they are
specifically created for a particular matter. For costs associated with the creation and use of
computerized databases, contractors and retained legal counsel must ensure that the creation and
use of computerized databases is necessary and cost-effective. Use of databases originally created
by the Department or its contractors for other purposes, but that can be used to assist a contractor
or retained legal counsel in connection with a particular matter, should be considered. Contractors
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and retained legal counsel must ensure that DOE is provided the discretion to obtain unlimited
access to and dominion over any computers or general application software, or non-routine
computerized databases specifically created for a particular matter;
(2) Secretarial and support services, word processing, or temporary support personnel;
(3) Attendance by more than one attorney at a deposition, court hearing or interview;
(4) Expert witnesses and consultants;
(5) Trade publications, books, treatises, background materials, and other similar documents;
(6) Professional or educational seminars and conferences;
(7) Preparation of bills or time spent responding to questions about bills from either the Department or
the contractor;
(8) Food and beverages when the attorney or consultant is not on travel status and away from the home
office;
(9) Pro hac vice admissions; and
(10) Time charged for law students' or interns' services.
(b) Requests for fee increases by retained legal counsel, other than those under contract directly with the
Department, must be sent in writing to the contractor, who will review the request for reasonableness. If
the contractor determines the request is reasonable, the contractor must seek approval for the increase
from Department Counsel before it authorizes any increase. Contractors should attempt to lock in rates
for partners, associates and paralegals for at least a two year period.

§ 719.45 Are there any special procedures or requirements regarding subcontractor and
retrospective insurance carrier legal costs?
(a) The contractor shall establish a monitoring system for significant matters in litigation which are handled
by subcontractors other than retrospective insurance carriers whose contracts provide for the
reimbursement of legal costs. The purpose of this monitoring system is to enable the contractor to be
regularly informed of the progress of the Significant Matter, to monitor the associated costs and help
ensure that they are reasonable, and to report on the progress of the Significant Matter and the
associated costs to Department Counsel.
(b) The contractor shall require retrospective insurance carriers and other subcontractors whose contracts
provide for the reimbursement of legal costs to request prior permission from the contractor to enter into
a settlement agreement with, or make any payments to, claimants or third-parties if:
(1) In the case of a subcontractor other than a retrospective insurance carrier, the settlement or payment
amount is likely to reach $25,000 or more; or
(2) In the case of a retrospective insurance carrier, the settlement or payment amount is likely to reach
$100,000 or more.
(c) The contractor shall require the insurance carrier or other subcontractor to submit all documentation
described in § 719.34 and to provide the contractor with a copy of the executed settlement agreement
within seven days of execution, which the contractor will promptly forward to Department Counsel. The

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contractor shall not authorize the subcontractor to enter into a settlement agreement or make a payment
to a claimant or third-party that is likely to reach or exceed the above-stated threshold amounts without
first obtaining the approval of the Department Counsel.
(d) Upon request from Department Counsel, the Contracting Officer, or other authorized representative of the
Department, the contractor shall provide detailed cost information regarding particular legal matters
handled by retrospective insurance carriers or other subcontractors whose contracts provide for the
reimbursement of legal costs.
(e) The contractor shall provide reviewed costs and status updates for all significant matters in litigation
handled by subcontractors whose contracts provide for the reimbursement of legal costs in accordance
with § 719.51. The contractor is not required to provide cost and status updates for matters handled by
retrospective insurance carriers except upon the written request of the cognizant Contracting Officer or
Department Counsel.

§ 719.46 Are costs covered by this part subject to audit?
All costs covered by this part are subject to audit by the Department, its designated representative, or the
Government Accountability Office. See § 719.21.

§ 719.47 What happens when more than one contractor is a party to a matter?
(a) If more than one contractor is a party in a particular matter and the issues involved are similar for all the
contractors, a single legal counsel designated by the General Counsel must either represent all of the
contractors or serve as lead counsel, when the rights of the contractors and the Government can be
effectively represented by a single legal counsel, consistent with the standards for professional conduct
applicable in the particular matter. Contractors may propose to the General Counsel their preference for
the individual or law firm to perform as the lead counsel for a particular matter.
(b) If a contractor, having been afforded an opportunity to present its views concerning joint or lead
representation, does not acquiesce in the designation of one retained legal counsel to represent a number
of contractors, or serve as lead counsel, then the legal costs of such contractor are not reimbursable by
the Department, unless the contractor demonstrates that it was reasonable for the contractor to incur
such expenses.

Subpart F—Department Counsel
§ 719.50 What authority does Department Counsel have?
(a) Department Counsel will receive written delegated authority from the contracting officer to serve as the
contracting officer's representative for legal matters.
(b) Actions by Department Counsel may not exceed the responsibilities and limitations as delegated by the
contracting officer. Delegated contracting officer representative authority shall not be construed to include
the authority to execute or modify the contract or resolve any contract dispute arising under the contract.
Additional discussion of the authority and limitation of contracting officers can be found at 48 CFR
1.602-1, and contracting officer's representatives at 48 CFR (DEAR) 942.270-1. The clause, Technical
Direction, 48 CFR (DEAR) 952.242-70, also discusses the responsibilities and authority of a contracting
officer's representative.

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§ 719.51 What information must be forwarded to the General Counsel's Office concerning
contractor submissions to Department Counsel under this part?
Department Counsel must submit through the General Counsel reporting system, the reviewed costs and status
updates for all matters involving retained counsel, including but not limited to contractor litigation. The reports are
to be received by the 15th day of the month following the end of each quarter of the fiscal year.

§ 719.52 What types of field actions must be coordinated with the General Counsel?
(a) Requests from contractors for exceptions or deviations from this part must be submitted to the
contracting officer and Department Counsel, and approved by the General Counsel or his/her delegee.
(b) Requests from contractors for approval to initiate or defend litigation, or to appeal from adverse
decisions, where legal issues of first impression, sensitive issues, issues of national significance to the
Department or of broad applicability to the Government that might adversely impact its operations are
involved must be coordinated by Department Counsel with the General Counsel or his/her delegee.
(c) Department Counsel must inform the General Counsel of any Significant Matter, as defined in this part,
and must coordinate any action involving a Significant Matter with the General Counsel, or his/her
delegee, as directed by the General Counsel or his/her delegee.

Appendix A to Part 719—Guidance for Legal Resource Management

Management and Administration of Outside Legal Services
1.0 Alternative Dispute Resolution
2.0 Cost Allowability Issues
2.1 Underlying Cause for Incurrence of Costs
Attachment—Contractor Litigation and Legal Costs, Model Bill Format

Management and Administration of Outside Legal Services
This guidance is intended to assist contractors, contracting officers and retained legal counsel in managing the
costs of outside legal services.

1.0 Alternative Dispute Resolution
Contractors are expected to evaluate all matters for appropriate alternative dispute resolution (ADR) at
various stages of an issue in dispute, e.g., before a case is filed, during pre-discovery, after initial
discovery and during pretrial. This evaluation should be done in coordination with the Department's ADR
liaison if one has been established or appointed or Department Counsel if an ADR liaison has not been
appointed. Contractors, contractor counsel, and Department Counsel are also encouraged to consult with
the Department's Director of the Office of Conflict Prevention and Resolution. The Department anticipates
that mediation will be the principal and most common method of alternative dispute resolution.
Agreement to arbitrate should generally be consistent with the Administrative Dispute Resolution Act

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(incorporated in part at 5 U.S.C. 571, et seq.) and Department guidance issued under that Act. When a
decision to arbitrate is made, a statement fixing the maximum award amount should be agreed to in
advance by the participants.

2.0 Cost Allowability Issues
A determination of cost reasonableness depends on a variety of considerations and circumstances. 48
CFR 31.201-3 establishes that no presumption of reasonableness is attached to the incurrence of costs
by a contractor.

2.1 Underlying Cause for Incurrence of Costs
While 10 CFR part 719 provides procedures associated with incurring and monitoring legal costs, the
evaluation of the reason for the incurrence of the legal costs, e.g., liability, fault or avoidability, is a
separate issue. The reason for the contractor incurring costs may affect the allowability of the
contractor's legal costs. In some cases, the final determination of allowability of legal costs cannot
be made until a matter is fully resolved. In certain circumstances, contract and cost principle
language may permit conditional reimbursement of costs pending the outcome of the legal matter.
Whether the Department makes conditional reimbursements or withholds any payment pending the
outcome, legal costs ultimately reimbursed by the Department must comply with the applicable cost
principles, the terms of the contract, and part 719.

Attachment—Contractor Litigation and Legal Costs, Model Bill Format

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1. Model Bill Format
I—FOR FEES
Date of
service

Description of
service

Name or initials of
attorney

Approved
rate

Time
charged

Amount (rate ×
time)

(See Note 1 to this table).

II—FOR DISBURSEMENTS
Date

Description of
disbursement

Amount

(See Note 1 to this table).

Note 1—Description of Service: All fees must be itemized and described in sufficient detail and
specificity to reflect the purpose and nature of the work performed (e.g., subject matter
researched or discussed; names of participants of calls/meetings; type of documents reviewed).
Note 2—Description of Disbursement: Description should be in sufficient detail to determine that
the disbursement expense was in accordance with all applicable Department policies on
reimbursement of contractor legal costs and the terms of engagement between the contractor
and the retained legal counsel. The date the expense was incurred or disbursed should be listed
rather than the date the expense was processed. The following should be itemized: copy charge
(i.e., number of pages times the price per page); fax charges (date, phone number and actual
amount); overnight delivery (date and amount); electronic research (date and amount);
extraordinary postage (e.g., bulk or certified mail); court reporters; expert witness fees; filing fees;
outside copying or binding charges; temporary help (assuming prior approval).
Note 3—Receipts: Receipts for all expenses equal to or above $75 must be attached.

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