Conax to Settle Contract Fraud Claims for $2M; Whistleblowers to Get $810K

Conax Florida Corp. and related companies have agreed to settle allegations that Conax knowingly submitted or caused the submission of false claims to the U.S. government in connection with improperly tested and non-conforming equipment, the U.S. Department of Justice announced last month.

Conax Florida Corp. designed and manufactured inertia reels and voltage references used by the U.S. military and NASA.  Inertia reels are part of a system designed to secure aircrew members in the event of a crash.  On impact, inertia reels lock in place harnesses worn by aircrew members, preventing injury.  Voltage references are electronic parts used in water-activated parachute releases, designed to protect unconscious or injured aircrew members who parachute into salt water. 

The government alleged that the inertia reels were not tested in accordance with contractual requirements and that Conax used non-conforming voltage references.  The voltage reference is an integral part of the water-activated parachute release, intended to automatically separate parachutes from aircrew members when they are physically unable to do so.  If parachutes are not released, they may fill with water and drag aircrew members underwater. 

Besides the $2 million settlement, Conax has also agreed to provide the government with almost five thousand new electronic parts for use with parachute releases, which are worth up to $2.4 million.

The lawsuit was originally filed by Mark Hansson and Steven Schummer, former Conax employees, under the whistleblower provision of the False Claims Act.  The False Claims Act allows private citizens with knowledge of fraud against the government to sue on behalf of the government and share in the recovery.  Hansson and Schummer will together receive up to a total of $810,478.

The Chanler Group, in association with the Hirst Law Group, represents whistleblowers who take action under the False Claims Act to report fraud committed against the federal and state governments.  We have years of experience representing whistleblower clients who expose every kind of fraud against the government, including health care fraud, contract fraud, and tax fraud.  Read more about our expertise in False Claims Act cases and how you can take action.