Constantine Cannon Announces a $900,000 Whistleblower Settlement With Luxury UK e-Retailer

Constantine Cannon LLP is pleased to announce a more than $900,000 settlement on behalf of its whistleblower client in a lawsuit against Pure Collection Ltd. Pure Collection is a Harrogate, England-based e-retailer of luxury cashmere and apparel goods. The United States Government announced the settlement agreement yesterday with Pure Collection and the e-retailer’s acting CEO, Samantha Harrison. The company and Ms. Harrison have collectively agreed to a settlement of $908,100 (USD) to the U.S. Government.

This lawsuit was one of the first to be brought by a U.K. whistleblower in which the U.S. Government intervened and successfully resolved the whistleblower’s False Claims Act (FCA) allegations. The whistleblower, Andrew Patrick of Harrogate, England, brought to Constantine Cannon’s London office information regarding Pure Collection’s practices. Mr. Patrick will be awarded 18 percent of the total settlement.

The qui tam, or whistleblower, lawsuit alleged that since 2007 the defendants fraudulently and systematically avoided paying U.S. customs duties on its goods shipped from the United Kingdom to customers in the United States. In an attempt to attract more U.S.-based customers, Pure Collection engaged in a practice commonly known as “splitting.” The defendants neither admitted nor denied liability.

Whistleblower Andrew Patrick worked for Pure Collection from 2010 to 2014, first as a sales representative in its U.K. call center and then in its U.K. packaging department.  Mr. Patrick was trained to systematically split customers’ large orders to successfully avoid paying U.S. customs fees, saving the company millions of dollars, according to the suit.

Mr. Patrick brought his allegations to the attention of U.S. Customs and Border Protection in 2014, and later filed a whistleblower submission with the U.S. Internal Revenue Service in 2015. After the two initial unsuccessful attempts to alert U.S. authorities, Mr. Patrick approached Constantine Cannon to represent him.  Mr. Patrick filed his whistleblower suit in 2016 in federal court in Maine.

The federal False Claims Act (FCA) encourages whistleblowers of any nationality to expose companies that are defrauding the U.S. Government by allowing a private party from any country to file a civil lawsuit on the government’s behalf and providing for a reward of 15 to 25 percent of the Government’s civil recovery if the government joins, or intervenes in, the case, as the Government has done here.  Mr. Patrick will receive 18 percent of the Government’s recovery.

The FCA is one of the most effective weapons in combatting fraud, waste, and abuse by those who contract with the U.S. Government. Since 2017, the U.S. has recovered upwards of $50 million in customs duties fraud cases alone.  Just last week, the Wall Street Journal observed an increase in whistleblower cases exposing customs-related wrongdoing.  Such fraud can be difficult to uncover without access to inside information; well-placed whistleblowers like Mr. Patrick are necessary to provide the information to help stop these practices.

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