DRS Technical Services Agrees to Settle False Claims Act Allegations for $13.7 Million

Aside from healthcare fraud, intentional fraudulent misconduct pursuant to contracts for defense goods or services is one of the most common areas triggering liability under the federal False Claims Act. As you may recall, the False Claims Act got its start during the Civil War era as a way to eradicate costly, life-threatening scams perpetrated on soldiers and others members of the defense department. For instance, it was not uncommon for companies to contract with the government for the provision of uniforms or artillery, only to provide sub-standard, used, or unfit items – or even no items at all. As a result, the Lincoln administration made it a top priority to legislate and enact the original False Claims Act, thereby imposing possible civil liability upon any government contractor choosing to perpetuate fraud against the government.

Today’s case reiterates the age-old proverb reminding us that there is truly nothing new under the sun. Virginia-based military contractor DRS Technical Services, Inc. opted to settle False Claims Act allegations involving improper billing procedures for services provided to the U.S. military during the wars in Afghanistan and Iraq. As a result, the government and the whistleblower involved in the case recovered $13.7 million on behalf of taxpayers.

Details of Case Against DRS Technical Solutions, Inc.

One of the main issues often triggering False Claims Act liability involves failure to abide by the terms of the contract agreement between the Department of Defense and the obligee. These contracts often contain a requirement to employ qualified staff and workers for the job at hand.  Failure to do so is considered a violation of the contractual agreement, and any subsequent submission for payment following unqualified service is considered a false claim.

According to allegations, DRS was engaged in the use of unqualified employees and workers with regard to its contract to provide logistical and support services to the Department of Defense and all branches of the U.S. military during the Afghanistan and Iraq wars. More specifically, the Department of Justice alleges that from 2003 through 2012, DRS routinely employed under-qualified labor support services in violation of the terms of the contract. In response to the fraud, the government commented, “Contractors that fail to provide qualified labor as promised are not entitled to bill the government as though they had.”

Commencing a False Claims Act Lawsuit

If you are aware of government fraud under a defense contract with the Department of Defense, you may be able to initiate a lawsuit similar to that described above. The first step in any successful False Claims Act lawsuit is to possess original information of the fraud –  information you derived from your own personal experience as opposed to a court filing or media report. The fraudulent conduct must be intentional and purposeful, as opposed to accidental and negligent. With regard to defense contracts, common types of fraud include overbilling for labor (i.e., overtime and wages), providing non-conforming parts, or deriving components from nations not approved by federal laws.

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