Government Contract Cases


Mountain States Settles Whistleblower's Allegations of DBE Fraud at $2.25M

Mountain States Settles Whistleblower's Allegations of DBE Fraud at $2.25M

Tennessee highway building firm, Mountain States Contractors, has agreed to pay $2.25 million to the U.S. government this week to resolve allegations they violated the False Claims Act (FCA) by falsely claiming to have subcontracted work to a minority-owned business. Whistleblower Ron Meadows, filed the initial lawsuit that triggered the investigation of Mountain States. The U.S. Department of Justice reports Meadows will collect a $500,000 cash whistleblower award as allowed under the FCA for his efforts in putting a stop to the contractor fraud scheme.

Whistleblower Ron Meadows Alleges Mountain States DBE

Meadows’ March 2012 whistleblower lawsuit claimed that the Jones Brothers affiliate, Mountain States, violated the FCA when it allegedly lied about subcontracting work out to minority-owned G&M Associates to qualify for federal funding under the United States Department of Transportation’s Disadvantaged Business Enterprise (DBE) program....


Menlo and Estes to Pay $13 Million to Resolve False Claims Act Overbilling Allegations

Menlo Logistics and its subcontractor Estes have agreed to pay the government $13 million to settle a False Claims Act lawsuit. The companies had allegedly overcharged the government in a Defense Department contract for freight transportation under the Defense Transportation Coordination Initiative. 

According to the lawsuit, Menlo and its subcontractor had, among other things, billed the government for air shipping when freight had actually been transported by truck.

Richard Ricks & Marcelo Cuellar Reported as Whistleblowers - $2.86M Bounty

The alleged overbilling was brought to light by whistleblowers Richard Ricks (58) and Marcelo Cuellar (30) and it goes back as far as 2007. Besides charging inappropriate air freight rates, the defendants had allegedly created other fraudulent surcharges, such as oversize rates. The whistleblowers became aware of the alleged scheme while Cuellar was working at Estes’ defense distribution depot in Tracy, California, and Ricks was CEO of Menlo subcontractor EXP Logistics Solutions.  Cuellar was fired by Estes two years after the investigation began....


US Postal Service v Lance Armstrong – Both Sides Seek Immediate Partial Wins in Whistleblower Case

The government's case against Lance Armstrong took an interesting turn this last week, when both parties filed for Summary Judgment in the case against Lance Armstrong and his cycling team, which is a motion for the judge to rule on key points of a lawsuit without the need to take them to trial.

The fallen sports icon is the sole visible defendant in the case, as the lawsuit also involves a defunct company, Tailwind Sports, which was the cycling team’s owner, and a Belgian national, cycling team director Johan Bruyneel, who is not living in the US.

Armstrong finally confessed to having taken performance enhancing drugs in 2013, after a long period of denials.

Whistleblower Floyd Landis Set off the $100 Million False Claims Case

The lawsuit arose from claims by whistleblower Floyd Landis., who was a member of Armstrong’s team. The federal government is looking to recover the amount of $32,267,279.85, which was paid to the cycling team in a sponsorship contract with the U.S. Postal Service....


Ameri-Source Graphite Electrode Antidumping Suit Nets $3M Taxpayers

Ameri-Source Graphite Electrode Antidumping Suit Nets $3M Taxpayers

In yet another antidumping U.S. False Claims Act lawsuit where a company throws its dishonest competitor under the bus, electrode manufacturer, Graphite Electrode Sales Inc. filed a qui tam claim against rival Ameri-Source for allegedly scheming to avoid paying import duties on its Chinese-made graphite electrodes.

Ameri-Source agreed to pay $3 million to resolve the allegations and Graphite Electrode Sales was granted a $480K reward for filing the whistleblower claim that exposed the fraudulent acts.

Whistleblower Graphite Electrode Alleges Customs Duty Evasion via Misrepresentation

Graphite Electrode became suspicious of Ameri-Source when it learned that, between December of 2009 and March of 2012, the Pennsylvania-based rival company allegedly evaded duties on 15 shipments of small-diameter graphite electrodes from China by knowingly misrepresenting that they were duty free large-diameter electrodes.  Graphite Electrode filed a whistleblower lawsuit under the qui tam provision of the FCA in 2013 and the U.S. government opted to intervene (took over prosecution of the whistleblower case) in February 2016....


IRS Whistleblower Program 2015 Report: The Good, The Bad, The Numbers

IRS Whistleblower Program 2015 Report: The Good, The Bad, The Numbers

In a message that precedes the Annual Report to Congress from the IRS’s Whistleblower Program, its Director Lee D. Martin addressed several key issues, most notably, the need to reduce the lifecycle of whistleblower claims. While praising the results of the program in terms of tax collections, the Director saw fit to address a problem many whistleblowers have encountered when reporting unlawful conduct by US taxpayers.
According to the report, Fiscal Year 2015 was a “big...

DOJ Declines Don’t Hinder Whistleblowers in Fraud Recovery Lawsuits

DOJ Declines Don’t Hinder Whistleblowers in Fraud Recovery Lawsuits

Whistleblowers are showing their persistence in continuing to pursue qui tam cases after the government declines to intervene and 2015 was the most profitable year yet for whistleblower recoveries in declined cases. When a whistleblower lawsuit is filed, it is under seal until the Department of Justice (DOJ) can review the case and decide one of three actions.
They can recommend to the court the case be dropped for lack of substance, they can take over the lawsuit from the whistleblower...

South Carolina U.S. Attorney’s Office Recovers Impressive $7M in FY2015

South Carolina U.S. Attorney’s Office Recovers Impressive $7M in FY2015

What do Parsons Government Services and four Florida HCA hospitals have in common? They’re the two major contributors of the notable $7 million sum collected by the South Carolina U.S. Attorney’s Office through fiscal year 2015 civil and criminal actions.
According to a December 3 U.S. Attorney’s Office statement, U.S. Attorney Bill Nettles announced that the District of South Carolina collected nearly $4.5 million in criminal actions and over $2.6 million in civil...

UPS Pays $4.2M in another Whistleblower Robert Fulk False Claims Act Lawsuit

UPS Pays $4.2M in another Whistleblower Robert Fulk False Claims Act Lawsuit

United Parcel Service (UPS) has agreed to pay $4.2 million to fourteen states, as well as the District of Columbia, New York City, and Chicago. This settlement resolves allegations that the major package delivery company regularly falsified shipment records, essentially charging the government for faster shipping than it delivered.

Ex-UPS Employee Robert Fulk’s Lawsuit Spotlights More UPS Government Contract Chicanery

The case was initiated by former UPS employee Robert Fulk under the whistleblower provisions of the federal False Claims Act, as well as the false claims laws in each state and city involved in the settlement. This settlement provides further resolution to an ongoing case between the government and UPS. In May 2015, UPS settled with the federal government and the state of New Jersey for more than $25 million over similar allegations, also stemming from Fulk’s whistleblowing....


U.S. Investigations Services $30 Million Government Contract Fraud Settlement

U.S. Investigations Services $30 Million Government Contract Fraud Settlement

A $30 million False Claims Act settlement was announced today in the U.S. Investigations Services (USIS) whistleblower initiated lawsuit that accused USIS and Altegrity, its parent company of fraudulent conduct as reported by former USIS executive Blake Percival under the whistleblower provisions of the act.

Blake Percival filed a lawsuit alleging that USIS violated the FCA by committing government contract fraud, breaching the terms of their contract to provide background checks for the U.S. Office of Personnel Management (OPM). USIS provided background checks for OPM from 1996 until September 2014. The suit alleged that between at least March 2008 and September 2012, USIS failed to adhere to contractually promised quality reviews of these background checks. 

USIS Executive Blake Percival Says Fired for Reporting Fraud 

Mr. Percival was an executive at USIS, working for the company from 2001 to June 2011, most notably as the Director of Fieldwork Services. Percival further alleged that he was fired in retaliation for refusing to have those employees under his supervision participate in fraudulent activity....


Food Vendor Chartwells Settles DC School District Whistleblower Lawsuit at $19M

Food Vendor Chartwells Settles DC School District Whistleblower Lawsuit at $19M

Washington DC school district’s food vendor Chartwells has agreed to settle a DC False Claims Act whistleblower lawsuit at $19 million to resolve allegations that it overcharged the city for school food supplies. Whistleblower Jeffrey Mills will receive a portion of that settlement for exposing the alleged contract breaches in a not yet announced amount, typically 15 to 25% of the settlement. Mills urges school districts using private food vendors to inspect vendor contracts and performance.

Whistleblower Jeffrey Mills Alleges Chartwells Cost School District Millions

Jeffrey Mills, former Director of the Office of Food and Nutritional Services for the Washington DC school district, filed a whistleblower lawsuit against Chartwells and Thompson Hospitality, the group that provided food services for the district’s schools since 2008....