W International Companies to Pay $10.5M to Settle FCA Allegations of Overcharging Air Force and Navy for Weld Tables

By the Constantine Cannon Whistleblower Team 

On March 17, the DOJ’s Office of Public Affairs announced that W International LLC, W International SC LLC, Precision Metal Equipment Handling LLC, and Chief Executive Officer Edward Walker agreed to pay $10.5 million to settle allegations under the False Claims Act of knowingly overcharging the U.S. Air Force and Navy for weld tables.[1]

Michigan-based W International LLC and South Carolina-based W International SC LLC conducted business in industrial welding and metal fabrication. Michigan-based Precision Metal Equipment Handling LLC manufactured weld tables for W International SC LLC.[2]

What Were the Allegations Involving Federal Funds?

The settlement resolves allegations tied to federal funds awarded to W International SC to refurbish a large-scale welding facility. The U.S. claims that the Defendants submitted or caused the submission of claims that inflated the price of weld tables supplied to the facility. The government funded the project through the Defense Production Act via a U.S. Air Force Technology Investment Agreement and Supplier Development Funds under a Navy contract with General Dynamics Electric Boat.[3]

Were Whistleblowers Involved In Initiating This Lawsuit?

Whistleblowers, such as the individual who initiated this case, can bring claims under the False Claims Act to report fraud and misconduct in federal government contracts and programs. Under the qui tam (or whistleblower provisions) of the False Claims Act, private parties (or relators) can file lawsuits on behalf of the government and receive a reward of up to 30% of any recovery.

In this case, whistleblower John Klausmeier, a former employee of W International SC LLC, will receive $1,863,750 as his share of the recovery. The case is captioned United States ex rel. Klausmeier v. W International, LLC, Civil Action number 22-cv-1774.[4]

Government Contract Fraud

Constantine Cannon attorney Ginger Buck commented: “The government counts on whistleblowers to expose fraud in public contracting.  When contractors inflate costs or misrepresent pricing, they divert taxpayer funds and undermine the integrity of the procurement system. Whistleblowers’ courage to speak up helps ensure government contractors are held accountable.”

Whistleblowers are often the ones to initiate successful cases involving fraud in government contracting, also known as procurement fraud. Federal and state governments purchase a wide range of goods and services, ranging from weapons systems to computer consulting and uniforms, under various procurement and contracting regulations. Some examples of procurement fraud can include but are not limited to the following:

• • Submitting inflated or false claims for material costs or labor.
  • Delivering nonconforming products  or products that have failed or not been through required quality assurance and testing procedures.
  • Making misrepresentations regarding costs, prices and discounts in violation of “most favored customer” or “best pricing” requirements, price reduction clauses, and Truth in Negotiations Act requirements.

Constantine Cannon Has Extensive Experience Representing Whistleblowers

If you believe you have a case, and would like to learn about Constantine Cannon’s other whistleblower successes, the False Claims Act, or what it means to be a whistleblower, please contact us. We will connect you with an experienced member of the Constantine Cannon whistleblower team for a free and confidential consultation.

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Sources:

[1] See https://www.justice.gov/opa/pr/w-international-companies-agree-pay-105m-settle-false-claims-act-allegations-overcharging

[2] Id.

[3] Id.

[4] Id.

Tagged in: False Claims Act, qui tam,