Aerospace Co Settles Whistleblower Lawsuit Claims of $90 Million Fraud

A whistleblower lawsuit was triggered by a man who alleged that a company developed by Boeing and Lockheed Martin was responsible for $90 million in fraudulent claims was recently settled.

The whistleblower lawsuit was filed by an insider who alleged that the two companies forced the U.S. government to pay $90 million fraudulently by overcharging for employee hours worked.

The lawsuit was filed against United Launch Services and United Launch Alliance. The whistleblower was previously employed by ULA. ULA was originally launched as a joint venture between Boeing and Lockheed Martin in an effort to win more contracts for rocket launching. The company’s primary purpose is to launch security satellites into space.

The whistleblower lawsuit was filed under the False Claims Act, which allows whistleblowers protection from retaliation as well as a potential recovery if the suit is successful. After the plaintiff brought forward his concerns of overpayment, the government argued that ULA had overbilled for labor costs on numerous occasions.

The whistleblower suit ended in a settlement, in which ULA agreed to pay more than $430,000. The whistleblower will receive over $82,000 as a part of that settlement. The company did not acknowledge wrongdoing as part of that settlement.

The False Claims Act also allows the government to seal cases until government agencies have completed an investigation. When the settlement agreement was achieved, the lawsuit was unsealed.

Within this whistleblower lawsuit, the plaintiff pursued damages of three times the true amount of fraud carried out by the companies. He also argued for double his lost wages after he was terminated from ULA.

Whistleblowers maintain protections when they come forward with a reasonable belief that fraud has occurred. When this fraud is reported to the authorities or to a supervisor at the company, that employer is prohibited from taking retaliatory action against the employee.

This was not the first time that claims were lodged against ULA. In December of 2016, the company settled a claim for $100,000 over allegations that a contractor paid workers kickbacks to win contract bids. According to that whistleblower suit, the government unnecessarily paid out higher costs to a subcontractor between 2011 and 2015.

The employee who initiated the whistleblower lawsuit was responsible for the company’s treasury. He was responsible for the oversight of more than $1 million in budget. According to court documents, he was transferred in 2009 to the company’s estimation group, the purpose of which was to submit cost proposals for private projects and government jobs.

As an employee working with that group, the plaintiff’s responsibility was to ensuring that all bids matched up with federal pricing laws. Contract pricing, according to the whistleblower lawsuit, is mostly based on estimated costs. With little to no competition, the opportunity for fraud was higher, according to the lawsuit.

The whistleblower said the government ended up paying for millions of dollars worth of work that was never completed in addition to inflated labor hours.

If you or someone you know believes you have grounds for a whistleblower lawsuit, you need to set aside time to talk with the experienced lawyers at Bradley/Grombacher- fill out the form on this page to learn more about your options.

Note: Bradley/Grombacher is not representing the plaintiff in this lawsuit.