On September 28, the U.S. Department of Justice (DOJ) announced that it had reached a $8.1 million settlement with Boeing over allegations that the aerospace company violated the False Claims Act (FCA).
The settlement resolves allegations that Boeing failed to comply with certain contractual manufacturing specifications in contracts with the U.S. Navy to manufacture the V-22 Osprey, a tiltrotor military aircraft.
“Specifically, the government contends that Boeing failed to perform required monthly testing on autoclaves used in the composite cure process and was not in compliance with additional requirements related to the testing,” the DOJ states.
“The government expects contractors to adhere to contractual obligations to which they have agreed and for which they have been paid,” said Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division. “Today’s settlement demonstrates our commitment to hold accountable contractors who violate such obligations and undermine the integrity of the government’s procurement process.”
The settlement stems from a qui tam whistleblower suit filed by former employees of Boeing involved in composites fabrication and autoclave operations within the V-22 program. The False Claims Act’s qui tam provisions enable private citizens to file lawsuits on behalf of the government if they know of an individual or company defrauding the government. The U.S. government may intervene and takeover the lawsuit. Regardless of whether the government intervenes, qui tam whistleblowers are eligible to receive between 15 and 30% of the government’s recovery.
According to the DOJ, the whistleblowers in the Boeing case are set to receive $1.5 million in connection with the settlement.
“All government contractors have a responsibility to follow the obligations and protocols set forth by their contracts,” said U.S. Attorney Jacqueline C. Romero for the Eastern District of Pennsylvania. “This office is committed to accountability and protection from false claims as shown in cases such as this.”
On July 25, a bipartisan group of senators introduced the False Claims Amendments Act of 2023, which address a few technical loopholes undermining the success of the FCA. The bill is widely supported by whistleblower advocates.
“The False Claims Act is America’s number one fraud-fighting law,” said whistleblower attorney Stephen M. Kohn. “These amendments are urgently needed to ensure that whistleblowers can continue to play their key role in protecting taxpayers from corporate criminals.”