A settlement has been reached in a whistleblower class action lawsuit brought against FreshPoint Inc who is accused of overcharging the Department of Defense for fresh fruit and vegetables purchased under 15 separate contracts. The contracts were awarded to East Coast Fruit Company and subsequently performed by FreshPoint following FreshPoint’s acquisition of East Coast Fruit Company in 2007.
The whistleblower in this case will receive $798,000 of the government's recovery.
The intial lawsuit was filed in December of 2010. The government complaint claims that from Dec. 17, 2007, through Sept. 11, 2009, FreshPoint overcharged the government on hundreds of sales of fresh fruit and vegetables by improperly inflating its prices to the government to reflect FreshPoint’s view of the prevailing market price of the goods at the time of sale. The government alleged that this practice violated FreshPoint’s contracts with the government that required FreshPoint to provide the produce at cost, plus a pre-established mark-up for profit, and did not allow FreshPoint to make additional price adjustments based upon perceived changes in market prices.
