Business

A settlement has been reached in a whistleblower class action lawsuit brought against AT&T Missouri (formerly known as Southwestern Bell Telephone L.P.), who is accused of engaging in non-competitive bidding practices for Federal Communications Commission contracts.

The whistleblower will receive a $195,000 share of the government's settlement.

Originally filed in 2006, the United States alleged that the Company violated the False Claims Act in connection with the Federal Communications Commission's E-Rate program. 

The E-Rate program, which Congress created in the Telecommunications Act of 1996, provides funding for needy schools and libraries to connect to and utilize the Internet. Under the program, which is supported by fees collected from telephone users, schools apply for funds to pay for hardware and monthly connectivity service fees.

The government's complaint asserted AT&T Missouri provided false information to the E-Rate program and otherwise violated the program’s requirements by engaging in non-competitive bidding practices for E-Rate contracts. The United States further alleged that AT&T Missouri employees colluded with officials in the Kansas City, Mo., School District to award contracts to the company, extended contracts in violation of E-Rate rules and provided meals and other inducements to school district employees.

A settlement has been reached in a whistleblower class action lawsuit brought against Dynamics Research Corporation (DRC) who is accused of engaging in a fraudulent kickback scheme involving two technical services contracts with the Air Force.

The contracts, first awarded in 1996, sought DRC’s expertise in procuring computer equipment and services for the Theater Battle Management Core Systems (TBMCS) program at Hanscom Air Force Base in Massachusetts. The TBMCS program provides the military with an integrated system to plan and execute air battle plans for operations and intelligence personnel at the force and unit levels. The contracts required DRC’s employees to certify that neither they nor their spouses had financial interests that would interfere with their ability to deliver unbiased advice while performing the contracts. DRC failed to obtain the certificates from former vice presidents Paul Arguin and Victor Garber, who headed the project.

The United States alleged that from 1997 to 2000, DRC, through Mr. Arguin and Mr. Garber, steered Air Force contracts for computer equipment and services to companies owned by themselves, Mr. Arguin’s wife, and others, in exchange for kickbacks and inflated contract prices that produced windfall profits for the two DRC executives. In one of the schemes, Arguin and Garber allegedly substituted inexpensive memory modules for those required by the contract, causing the Air Force to overpay for the nonconforming modules.

A settlement has been reached in a whistleblower class action lawsuit brought against Aventis Pharmaceutical Inc., a wholly owned subsidiary of sanofi-aventis U.S. LLC.  Aventis is accused of misreporting drug prices in order to reduce its Medicaid Drug Rebate obligations.

According to the settlement, the federal recovery is approximately $49 million. Aventis will also pay over $40 million to the Medicaid participating states, and over $6 million to certain public health services entities who paid inflated prices for the drugs at issue.

The United States complaint alleged that between 1995 and 2000, Aventis and its corporate predecessors knowingly misreported best prices for the steroid-based anti-inflammatory nasal sprays Azmacort, Nasacort and Nasacort AQ. Under the Medicaid Drug Rebate Statute, Aventis was required to report to Medicaid the lowest, or "best" price that it charged commercial customers, and pay quarterly rebates to the states based on those reported prices.

In order to avoid triggering a new best price that would obligate it to pay millions of dollars in additional drug rebates to Medicaid, Aventis entered into "private label" agreements with the HMO Kaiser Permanente that simply repackaged Aventis’s drugs under a new label. As a result, Aventis underpaid drug rebates to the Medicaid program and overcharged certain Public Health Service entities for these products.

A settlement has been reached in a whistleblower class action lawsuit brought against Lighthouse Disaster Relief and partners Gary Heldreth and Kerry Farmer. They are accused of accepted payment for work that was not completely performed on a contract with the Department of Homeland Security.

The settlement agreements require Heldreth, Farmer and Lighthouse to accept a judgment of $4 million less the approximately $1.3 million previously garnished by the government.

The lawsuit was originally filed in February of 2006.  The United States alleged the defendants knowingly breached their contract to build and operate a basecamp to house and feed first responders who went to New Orleans to help with rescue and recovery efforts after Hurricane Katrina. The complaint alleged that the defendants made false statements to FEMA employees in order to be paid prematurely. The defendants then failed to build and staff a basecamp sufficient to house the number of first responders called for in their contract.

A settlement has been reached to resolve False Claims Act allegations against Fastenal Company who is accused of knowingly failing to meet its contractual obligations.

This settlement was reached following an investigation of alleged false claims in connection with a General Services Administration (GSA) contract. 

The GSA Office of Inspector General learned that Fastenal knowingly failed to meet its contractual obligations to provide the GSA with current, accurate and complete information about its commercial sales practices, including discounts afforded to other customers.

In addition, the United States alleged that Fastenal failed to comply with the price reduction clause of its GSA contract, overcharged government customers, and improperly assessed delivery and sales tax charges on government sales. As a result, the government paid more than it should have for Fastenal products. The settlement also resolves allegations that Fastenal violated the Trade Agreements Act when it knowingly sold products to the United States that were manufactured in countries that do not have trade agreements with the United States, e.g., China.

A settlement has been reached in a whistleblower class action lawsuit brought against CareSource, CareSource Management Group Co and CareSource USA Holding Co. They are accused of causing Medicaid to make payments for assessments and case managements they failed to provide to children and adults.

The whistleblowers will receive a $3.1 million share of the government's recovery.

Originally filed in November 2006, the United States alleged that between January 2001 and December 2006, the CareSource entities knowingly failed to provide required screening, assessment and case management for adults, and children with special health care needs. As a result, it was alleged that CareSource received millions of dollars in Medicaid funds to which it was not entitled. The CareSource entities subsequently submitted false data to the state of Ohio so that it appeared they were providing these required services to improperly retain incentives received from Ohio Medicaid and to avoid penalties.

A settlement has been reached in a whistleblower class action lawsuit brought against DynCorp International LLC and The Sandi Group (TSG). They are accused of submitting false claims to the Department of State.

According to the settlement, DynCorp has agreed to pay the United States $7.7 million and TSG agreed to pay $1.01 million. The whistleblowers will will share a total of up to $481,710 of the government’s recovery.

Originally filed in September 2006, the United States alleged that DynCorp submitted inflated claims for the construction of container camps at various locations in Iraq and that TSG sought reimbursement for danger pay that it falsely claimed to have paid its U.S. expatriate employees working in Iraq.