This is part of an ongoing series of Covington blogs on implementation of Executive Order 14028, “Improving the Nation’s Cybersecurity,” issued by President Biden on May 12, 2021 (the “Cyber EO”).  The first blog summarized the Cyber EO’s key provisions and timelines, and subsequent blogs described the actions taken by various government agencies to implement the Cyber EO from June 2021 through June 2024.  This blog describes key actions taken to implement the Cyber EO, as well as the U.S. National Cybersecurity Strategy, during July 2024.  It also describes key actions taken during July 2024 to implement President Biden’s Executive Order on Artificial Intelligence (the “AI EO”), particularly its provisions that impact cybersecurity, national security, and software supply chain security.

NIST and NTIA Issue Guidance Regarding  Artificial Intelligence

The National Institute of Standards and Technology (“NIST”) released a cross-sectoral profile and companion resource to the AI risk management framework (“AI RMF”) that NIST released in January 2023.  The profile implements the AI RMF functions and categories for Generative AI and offers insights into how risk can be managed across various stages of the AI lifecycle and for GAI as a technology.

The guidelines identify the following twelve areas of risks unique to or exacerbated by the development of Generative AI:

  1. Chemical, biological, radiological, or nuclear information or capabilities;
  2. Confabulation;
  3. Dangerous, violent, or hateful content;
  4. Data privacy;
  5. Environmental impacts;
  6. Harmful bias or homogenization;
  7. Human-AI configuration;
  8. Information integrity;
  9. Information security;
  10. Intellectual property;
  11. Obscene, degrading, and/or abusive content; and
  12. Value chain and component integration.

NIST encourages organizations to consider these categories of risks when attempting to identify and manage generative AI risks.  NIST attempts to address these by offering proposed solutions to each category of risks.

Additionally, this month the NIST-run U.S. AI Safety Institute and the National Telecommunications and Information Administration (“NTIA”) both published new information on AI risks.  The U.S. AI Safety Institute issued draft guidance on Managing Misuse Risk of Dual-Use Foundation Models.  The draft guidance, which was developed in accordance with the AI EO, is focused on managing the risk that such models will be deliberately misused to cause harm.  NTIA, as directed under the AI EO, released its Report on Dual-Use Foundation Models with Widely Available Model Weights.  NTIA recommends that agencies develop new capabilities to monitor for potential risks, but refrain from immediately restricting the wide availability of open model weights in the largest AI systems.

Finally, NIST also released the final version of Special Publication 800-218A, “Secure Software Development Practices for Generative AI and Dual-Use Foundation Models” this month.  The document fulfills a requirement of the AI EO – specifically, the requirement for NIST to “develop[] a companion resource to the Secure Software Development Framework to incorporate secure development practices for generative AI and for dual-use foundation models.”  The publication recognizes that while there are significant similarities between generative AI/dual use foundational model software and traditional software, there are also unique risks that only apply to generative AI and dual use foundational model software.  Notably, the publication recognizes that there may be risks associated with unknown datasets, tampering of model weights and functionality, and models that are too complex to allow for adequate inspection.  The document describes practices that are specifically tailored to address these risks in the form of a “community profile” that supplements NIST SP 800-218, which addresses the risks of software vulnerabilities in the development context more generally.  The community profile is meant to be tailored and adopted based on the specific needs of the developer, and includes various “practices” and “tasks” that should be considered by the organization.  Ultimately, the practices and tasks described by this publication could be adopted by the Government as an extension of various existing initiatives, such as the requirement for attestation to secure development practices or a third party assessment in order to develop software used by an agency, as described here.

Executive Office of the President Releases Memorandum Regarding Administration Cybersecurity Priorities for the FY 2026 Budget

The Executive Office of the President released a memorandum on July 10, outlining the Biden Administration’s cross-agency cybersecurity investment priorities for formulating its fiscal year (“FY”) 2026 budget proposal.  The memorandum details the priorities agencies should focus on in their budget submissions and outlines the process by which the Office of Management and Budget (“OMB”) and the Office of the National Cyber Director will review agency budget submissions to ensure they adequately address and are consistent with overall cybersecurity strategy and policy, aiding agencies’ multi-year planning through the regular budget process. 

The memorandum notes that agencies budget submissions should focus on increasing the maturity of information systems consistent with the National Cybersecurity Strategy’s five pillars to enhance national security: (1) Defend Critical Infrastructure, (2) Disrupt and Dismantle Threat Actors, (3) Shape Market Forces to Drive Security and Resilience, (4) Invest in a Resilient Future, and (5) Forge International Partnerships to Pursue Shared Goals.  In the accordance with the Biden Administration’s cybersecurity priorities, among the areas of emphasis for agencies are the following:

  • Scaling public-private collaboration to defend critical infrastructure;
  • Implementing zero trust architecture;
  • Improving basic cybersecurity requirements, including by only using software that is provided by producers who can attest to compliance with Government-specified secure software development practices; and
  • Increasing secure use and maintenance of open source software into IT and governance structures.

The memorandum serves to further emphasize the administration’s interest in improving agencies’ basic cybersecurity requirements and gives contractors a view into the priorities of agencies going forward.

CISA Updates Software Bill of Materials Frequently Asked Questions

On July 16, the Cybersecurity and Infrastructure Agency (“CISA”) announced via X that it updated its Software Bill of Materials (“SBOM”) Frequently Asked Questions (“FAQ”).  This is the latest step CISA has taken to advance the adoption of SBOMs in federal procurements.  The updated SBOM FAQ provides general introductory information on SBOMs, common use cases for SBOMs, their benefits, common misconceptions and concerns, the processes for creating, distributing, and sharing an SBOM.  The FAQ could be helpful to contractors seeking more information about SBOMs, particularly as they seek to comply with forthcoming rules. This includes the proposed FAR rule that may require  contractors to develop and maintain a SBOM for any software used in the performance of a government contract, and the Office of Management and Budget’s secure software development requirements, which indicates that SBOMs may be required if attestations to secure software development requirement implementation are not sufficient.

OMB Issues Memorandum on Modernizing the Federal Risk and Authorization Management Program

OMB released a memo on July 25 outlining substantial changes to the Federal Risk and Authorization Management Program (“FedRAMP”).  This memo was issued in connection with the FedRAMP Authorization Act and replaces the December 2011 memo establishing FedRAMP as the government risk assessment program for cloud service providers.  It also follows a draft that the Office of Management and Budget issued in October 2023 for public comment.  The memo outlines OMB’s plan to strengthen FedRAMP’s approach to security, increase procurement of cloud products and services, and broaden FedRAMP’s reach.

The memo outlines certain changes to FedRAMP.  Of note to contractors, the memo implements several changes to the FedRAMP authorization process (including the creation of an additional “program level” path to authorization); clarifies FedRAMP’s scope to include “cloud computing products and services (such as [Infrastructure-as-a-Service] (IaaS), Platform-as-a-Service (PaaS), and SaaS) that create, collect, process, store, or maintain Federal information on behalf of a Federal agency, and that are not otherwise specified as out of scope;” and encourages the adoption of a standardized continuous monitoring framework.

Within 180 days of its release, agencies are expected to issue policies aligned with the memo.  Within one year of the memo’s release, GSA will issue a plan to structure FedRAMP “to encourage the transition of Federal agencies away from the use of Government-specific cloud infrastructure.”

FCC Adopts Order Establishing Voluntary IoT Labeling Program

On July 30, the Federal Communications Commission (“FCC”) adopted an order creating a voluntary cybersecurity labeling program for Internet of Things (“IoT”) devices.  The FCC’s new order relates to Section 4(t) of the Cyber EO, which directs certain agencies to identify IoT cybersecurity criteria for a consumer labeling program.  The Inside Global Tech blog has full coverage of this order.

Senate Homeland Security Committee Approves AI Procurement Reform Bill

On July 31, the Senate Homeland Security Committee cleared for floor consideration the PREPARED for AI Act.  The bill would codify guidelines issued in March by the OMB on implementing President Biden’s AI EO.  The bill, sponsored by Senators Gary Peters and Thom Tillis, would create a Chief Artificial Intelligence Officers Council that would coordinate the development and use of AI among federal agencies and form agency-specific AI governance boards to manage and oversee AI activities.  If the bill passed, agencies would establish a risk-classification system to identify high-risk AI.  Contractors engaging in high-risk uses of AI would be subject to ongoing monitoring and reporting obligations and would begin to see contract terms governing AI capabilities, should the bill pass, and would generally supplement the required actions under Biden’s AI EO.

Photo of Robert Huffman Robert Huffman

Bob Huffman counsels government contractors on emerging technology issues, including artificial intelligence (AI), cybersecurity, and software supply chain security, that are currently affecting federal and state procurement. His areas of expertise include the Department of Defense (DOD) and other agency acquisition regulations governing…

Bob Huffman counsels government contractors on emerging technology issues, including artificial intelligence (AI), cybersecurity, and software supply chain security, that are currently affecting federal and state procurement. His areas of expertise include the Department of Defense (DOD) and other agency acquisition regulations governing information security and the reporting of cyber incidents, the Cybersecurity Maturity Model Certification (CMMC) program, the requirements for secure software development self-attestations and bills of materials (SBOMs) emanating from the May 2021 Executive Order on Cybersecurity, and the various requirements for responsible AI procurement, safety, and testing currently being implemented under the October 2023 AI Executive Order. 

Bob also represents contractors in False Claims Act (FCA) litigation and investigations involving cybersecurity and other technology compliance issues, as well more traditional government contracting costs, quality, and regulatory compliance issues. These investigations include significant parallel civil/criminal proceedings growing out of the Department of Justice’s Cyber Fraud Initiative. They also include investigations resulting from False Claims Act qui tam lawsuits and other enforcement proceedings. Bob has represented clients in over a dozen FCA qui tam suits.

Bob also regularly counsels clients on government contracting supply chain compliance issues, including those arising under the Buy American Act/Trade Agreements Act and Section 889 of the FY2019 National Defense Authorization Act. In addition, Bob advises government contractors on rules relating to IP, including government patent rights, technical data rights, rights in computer software, and the rules applicable to IP in the acquisition of commercial products, services, and software. He focuses this aspect of his practice on the overlap of these traditional government contracts IP rules with the IP issues associated with the acquisition of AI services and the data needed to train the large learning models on which those services are based. 

Bob is ranked by Chambers USA for his work in government contracts and he writes extensively in the areas of procurement-related AI, cybersecurity, software security, and supply chain regulation. He also teaches a course at Georgetown Law School that focuses on the technology, supply chain, and national security issues associated with energy and climate change.

Photo of Susan B. Cassidy Susan B. Cassidy

Susan is co-chair of the firm’s Aerospace and Defense Industry Group and is a partner in the firm’s Government Contracts and Cybersecurity Practice Groups. She previously served as in-house counsel for two major defense contractors and advises a broad range of government contractors…

Susan is co-chair of the firm’s Aerospace and Defense Industry Group and is a partner in the firm’s Government Contracts and Cybersecurity Practice Groups. She previously served as in-house counsel for two major defense contractors and advises a broad range of government contractors on compliance with FAR and DFARS requirements, with a special expertise in supply chain, cybersecurity and FedRAMP requirements. She has an active investigations practice and advises contractors when faced with cyber incidents involving government information, as well as representing contractors facing allegations of cyber fraud under the False Claims Act. Susan relies on her expertise and experience with the Defense Department and the Intelligence Community to help her clients navigate the complex regulatory intersection of cybersecurity, national security, and government contracts. She is Chambers rated in both Government Contracts and Government Contracts Cybersecurity. In 2023, Chambers USA quoted sources stating that “Susan’s in-house experience coupled with her deep understanding of the regulatory requirements is the perfect balance to navigate legal and commercial matters.”

Her clients range from new entrants into the federal procurement market to well established defense contractors and she provides compliance advices across a broad spectrum of procurement issues. Susan consistently remains at the forefront of legislative and regulatory changes in the procurement area, and in 2018, the National Law Review selected her as a “Go-to Thought Leader” on the topic of Cybersecurity for Government Contractors.

In her work with global, national, and start-up contractors, Susan advises companies on all aspects of government supply chain issues including:

  • Government cybersecurity requirements, including the Cybersecurity Maturity Model Certification (CMMC), DFARS 7012, and NIST SP 800-171 requirements,
  • Evolving sourcing issues such as Section 889, counterfeit part requirements, Section 5949 and limitations on sourcing from China
  • Federal Acquisition Security Council (FASC) regulations and product exclusions,
  • Controlled unclassified information (CUI) obligations, and
  • M&A government cybersecurity due diligence.

Susan has an active internal investigations practice that assists clients when allegations of non-compliance arise with procurement requirements, such as in the following areas:

  • Procurement fraud and FAR mandatory disclosure requirements,
  • Cyber incidents and data spills involving sensitive government information,
  • Allegations of violations of national security requirements, and
  • Compliance with MIL-SPEC requirements, the Qualified Products List, and other sourcing obligations.

In addition to her counseling and investigatory practice, Susan has considerable litigation experience and has represented clients in bid protests, prime-subcontractor disputes, Administrative Procedure Act cases, and product liability litigation before federal courts, state courts, and administrative agencies.

Susan is a former Public Contract Law Procurement Division Co-Chair, former Co-Chair and current Vice-Chair of the ABA PCL Cybersecurity, Privacy and Emerging Technology Committee.

Prior to joining Covington, Susan served as in-house senior counsel at Northrop Grumman Corporation and Motorola Incorporated.

Photo of Nooree Lee Nooree Lee

Nooree advises government contractors and financial investors regarding the regulatory aspects of corporate transactions and restructurings. His experience includes preparing businesses for sale, negotiating deal documents, coordinating large-scale diligence processes, and navigating pre- and post-closing regulatory approvals and integration. He has advised on…

Nooree advises government contractors and financial investors regarding the regulatory aspects of corporate transactions and restructurings. His experience includes preparing businesses for sale, negotiating deal documents, coordinating large-scale diligence processes, and navigating pre- and post-closing regulatory approvals and integration. He has advised on 35+ M&A deals involving government contractors totaling over $30 billion in combined value. This includes Veritas Capital’s acquisition of Cubic Corp. for $2.8 billion; the acquisition of Perspecta Inc. by Veritas Capital portfolio company Peraton for $7.1 billion; and Cameco Corporation’s strategic partnership with Brookfield Renewable Partners to acquire Westinghouse Electric Company for $7.8+ billion.

Nooree also counsels clients navigating the Foreign Military Sales (FMS) program and Foreign Military Financing (FMF) arrangements. Nooree has advised both U.S. and ex-U.S. companies in connection with defense sales to numerous foreign defense ministries, including those of Australia, Israel, Singapore, South Korea, and Taiwan.

Over the past several years, Nooree’s practice has expanded to include advising on the intersection of government procurement and artificial intelligence. Nooree counsels clients on the negotiation of AI-focused procurement and non-procurement agreements with the U.S. government and the rollout of procurement regulations and policy stemming from the Executive Order on Safe, Secure, and Trustworthy Artificial Intelligence.

Nooree maintains an active pro bono practice focusing on appeals of denied industrial security clearance applications and public housing and housing discrimination matters. In addition to his work within the firm, Nooree is an active member of the American Bar Association’s Section of Public Contract Law and has served on the Section Council and the Section’s Diversity Committee. He also served as the firm’s Fellow for the Leadership Council on Legal Diversity program in 2023.

Photo of Ashden Fein Ashden Fein

Ashden Fein is a vice chair of the firm’s global Cybersecurity practice. He advises clients on cybersecurity and national security matters, including crisis management and incident response, risk management and governance, government and internal investigations, and regulatory compliance.

For cybersecurity matters, Ashden counsels clients…

Ashden Fein is a vice chair of the firm’s global Cybersecurity practice. He advises clients on cybersecurity and national security matters, including crisis management and incident response, risk management and governance, government and internal investigations, and regulatory compliance.

For cybersecurity matters, Ashden counsels clients on preparing for and responding to cyber-based attacks, assessing security controls and practices for the protection of data and systems, developing and implementing cybersecurity risk management and governance programs, and complying with federal and state regulatory requirements. Ashden frequently supports clients as the lead investigator and crisis manager for global cyber and data security incidents, including data breaches involving personal data, advanced persistent threats targeting intellectual property across industries, state-sponsored theft of sensitive U.S. government information, extortion and ransomware, and destructive attacks.

Additionally, Ashden assists clients from across industries with leading internal investigations and responding to government inquiries related to the U.S. national security and insider risks. He also advises aerospace, defense, and intelligence contractors on security compliance under U.S. national security laws and regulations including, among others, the National Industrial Security Program (NISPOM), U.S. government cybersecurity regulations, FedRAMP, and requirements related to supply chain security.

Before joining Covington, Ashden served on active duty in the U.S. Army as a Military Intelligence officer and prosecutor specializing in cybercrime and national security investigations and prosecutions — to include serving as the lead trial lawyer in the prosecution of Private Chelsea (Bradley) Manning for the unlawful disclosure of classified information to Wikileaks.

Ashden currently serves as a Judge Advocate in the
U.S. Army Reserve.

Photo of Ryan Burnette Ryan Burnette

Ryan Burnette is a government contracts and technology-focused lawyer that advises on federal contracting compliance requirements and on government and internal investigations that stem from these obligations. Ryan has particular experience with defense and intelligence contracting, as well as with cybersecurity, supply chain…

Ryan Burnette is a government contracts and technology-focused lawyer that advises on federal contracting compliance requirements and on government and internal investigations that stem from these obligations. Ryan has particular experience with defense and intelligence contracting, as well as with cybersecurity, supply chain, artificial intelligence, and software development requirements.

Ryan also advises on Federal Acquisition Regulation (FAR) and Defense Federal Acquisition Regulation Supplement (DFARS) compliance, public policy matters, agency disputes, and government cost accounting, drawing on his prior experience in providing overall direction for the federal contracting system to offer insight on the practical implications of regulations. He has assisted industry clients with the resolution of complex civil and criminal investigations by the Department of Justice, and he regularly speaks and writes on government contracts, cybersecurity, national security, and emerging technology topics.

Ryan is especially experienced with:

  • Government cybersecurity standards, including the Federal Risk and Authorization Management Program (FedRAMP); DFARS 252.204-7012, DFARS 252.204-7020, and other agency cybersecurity requirements; National Institute of Standards and Technology (NIST) publications, such as NIST SP 800-171; and the Cybersecurity Maturity Model Certification (CMMC) program.
  • Software and artificial intelligence (AI) requirements, including federal secure software development frameworks and software security attestations; software bill of materials requirements; and current and forthcoming AI data disclosure, validation, and configuration requirements, including unique requirements that are applicable to the use of large language models (LLMs) and dual use foundation models.
  • Supply chain requirements, including Section 889 of the FY19 National Defense Authorization Act; restrictions on covered semiconductors and printed circuit boards; Information and Communications Technology and Services (ICTS) restrictions; and federal exclusionary authorities, such as matters relating to the Federal Acquisition Security Council (FASC).
  • Information handling, marking, and dissemination requirements, including those relating to Covered Defense Information (CDI) and Controlled Unclassified Information (CUI).
  • Federal Cost Accounting Standards and FAR Part 31 allocation and reimbursement requirements.

Prior to joining Covington, Ryan served in the Office of Federal Procurement Policy in the Executive Office of the President, where he focused on the development and implementation of government-wide contracting regulations and administrative actions affecting more than $400 billion dollars’ worth of goods and services each year.  While in government, Ryan helped develop several contracting-related Executive Orders, and worked with White House and agency officials on regulatory and policy matters affecting contractor disclosure and agency responsibility determinations, labor and employment issues, IT contracting, commercial item acquisitions, performance contracting, schedule contracting and interagency acquisitions, competition requirements, and suspension and debarment, among others.  Additionally, Ryan was selected to serve on a core team that led reform of security processes affecting federal background investigations for cleared federal employees and contractors in the wake of significant issues affecting the program.  These efforts resulted in the establishment of a semi-autonomous U.S. Government agency to conduct and manage background investigations.

Photo of Matthew Harden Matthew Harden

Matthew Harden is a cybersecurity and litigation associate in the firm’s New York office. He advises on a broad range of cybersecurity, data privacy, and national security matters, including cybersecurity incident response, cybersecurity and privacy compliance obligations, internal investigations, and regulatory inquiries. He…

Matthew Harden is a cybersecurity and litigation associate in the firm’s New York office. He advises on a broad range of cybersecurity, data privacy, and national security matters, including cybersecurity incident response, cybersecurity and privacy compliance obligations, internal investigations, and regulatory inquiries. He works with clients across industries, including in the technology, financial services, defense, entertainment and media, life sciences, and healthcare industries.

As part of his cybersecurity practice, Matthew provides strategic advice on cybersecurity and data privacy issues, including cybersecurity investigations, cybersecurity incident response, artificial intelligence, and Internet of Things (IoT). He also assists clients with drafting, designing, and assessing enterprise cybersecurity and information security policies, procedures, and plans.

As part of his litigation and investigations practice, Matthew leverages his cybersecurity experience to advise clients on high-stakes litigation matters and investigations. He also maintains an active pro bono practice focused on veterans’ rights.

Matthew currently serves as a Judge Advocate in the U.S. Coast Guard Reserve.

Photo of Catherine Wettach Catherine Wettach

Catherine Wettach is an associate in the firm’s Washington, DC office. She is a member of the Government Contracts and White Collar Defense and Investigation Practice Groups.