Joyce White Vance announced another major False Claims Act settlement and the first involving a NASA contract since she was sworn in as United States Attorney for the Northern District of Alabama. According to a statement from Vance’s office, the false claims were discovered by the Defense Contract Audit Agency regarding a Space Shuttle flight support services contract under which subcontractor Rocketdyne had provided services to primary contractor Pratt & Whitney. In 2005, the two companies merged to form United Technologies company Pratt & Whitney Rocketdyne, Inc. but continued to bill NASA “under the pre-merger subcontract. Although the company disputed the allegations, it agreed to pay $2.9 million to settle the case.

Assistant United States Attorney Lloyd Peeples — who is primarily responsible for the office’s False Claims Act cases — oversaw the investigation. Peeples is perhaps best known for representing the government in a False Claims Act qui tam case filed by Frohsin & Barger against SouthernCare, resulting in the largest Medicare Hospice Fraud settlement in U.S. history. The Pratt & Whitney Rocketdyne settlement is particularly important to Vance, because it signals that her office will pursue NASA and DoD fraud under the False Claims Act — a statutory tool that DoJ primarily uses to combat healthcare fraud.

“Contractors who work on government projects have a duty to correctly bill the government for work completed under the contract,” Vance said. “My office is committed to ensuring that in cases where a contractor has improperly charged the government, a proper resolution that protects the taxpayers’ interests is achieved. The return of almost $3 million today is a good result for the citizens.”

A renewed focus on combating such fraud is especially important in the defense contracting hub of the Northern District of Alabama which is home to NASA’s Marshall Space Flight Center, Huntsville’s Redstone Arsenal, and the Anniston Army Depot.

To report NASA fraud or defense contracting fraud, contact Frohsin & Barger.