April 25, 2023. The United States Department of Justice settled a case against government contractor L3 Technologies, Inc., Communication Systems West for alleged submission of false claims on “dozens” of government contracts. Under the terms of the settlement, the contractor paid $21.8 million. There was no whistleblower in this particular government contracts fraud case, but a whistleblower, or relator in a qui tam lawsuit, will generally earn between 15-25% of the government’s recovery.
L3 Technologies contracted with the Department of Defense to create two gadgets, the Remote Operations Video Enhanced Receiver (ROVER), and the Video Oriented Transceiver for Exchange of Information (VORTEX). Soldiers use these devices to gather and transmit data from the battlefield. Contractors do not typically have to include some low-cost common-stock items such as nuts and bolts, solvents, adhesives, lubricants, and other industrial goods consumed in the course of manufacturing a product on the bill of materials included in a government contract. These items are also known as “proratables.” The government alleged the cost of those proratables was included twice in the contract proposals submitted by L3 Technologies. As a result, the United States alleged that L3 knowingly double-charged the government for these parts.
The double-charged cost of low-cost common-stock items might seem small, but it means a lot when it comes to government contracts, which sometimes amount to billions of dollars. Even a minute misrepresentation or double-charge could lead to significant losses for taxpayers. The False Claims Act allows the government to recover damages and penalties for any company that knowingly submits false claims to the government. Under the qui tam provision of the False Claims Act, whistleblowers with knowledge of questionable practices can report fraud schemes for a share of the settlement.
L3 Technologies resolved this matter by agreeing to pay the Department of Justice a $21.8 million settlement. According to the Principal Deputy Assistant Attorney General, “Government contractors must ensure that they provide the goods or services that they promised at the proper price.” Whistleblowers can help the government hold contractors accountable for any fraudulent practice, in order to uphold integrity in government procurement processes and protect taxpayers from fraud.
If you would like to report government contractor fraud, you can contact attorneys at Tycko & Zavareei LLP. Eva Gunasekera and Renée Brooker are former officials of the United States Department of Justice and prosecuted whistleblower cases under the False Claims Act. Renée served as Assistant Director at the United States Department of Justice, the office that supervises False Claims Act cases in all 94 United States District Courts. Eva was the Senior Counsel for Health Care Fraud. Eva and Renée now represent whistleblowers. For a free consultation, you can contact Renée at [email protected] (tel.: 202-417-3664) or contact Eva Gunasekera at [email protected]. You can also go to Tycko & Zavareei LLP’s website for whistleblowers to learn more at https://www.fraudfighters.net/.