Government Intervenes in KBR False Claims Lawsuit
The government has filed a complaint against Kellogg, Brown & Root Services Inc. (KBR) and Kuwaiti companies La Nouvelle General Trading & Contracting Co. (La Nouvelle) and First Kuwaiti Trading Co. (First Kuwaiti) for submitting false claims in connection with KBR’s contract with the Army to provide logistical support in Iraq, the Department of Justice announced yesterday.
Allegedly, KBR knowingly made false claims to the government for a contract with the Army to provide wartime logistical support, known as the Logistics Civil Augmentation Program (LOGCAP) III. The award of LOGCAP III paved the way for the company to become a critical source for logistical support services in Iraq, which included transportation, maintenance, food, shelter, and facilities management. KBR performed many of these services through subcontracts awarded to foreign companies local to the region, such as La Nouvelle and First Kuwaiti.
The government alleged that, KBR employees took kickbacks from La Nouvelle and First Kuwaiti in connection with the award and oversight of subcontracts awarded to these companies. KBR then claimed reimbursement from the government for costs it incurred under the subcontracts that allegedly were inflated, excessive, or for goods and services that were grossly deficient or not provided. La Nouvelle later rewarded the KBR employee who awarded the subcontract with a $1 million bank draft. KBR billed the government for the costs of both of these subcontracts. The lawsuit also alleges that KBR used refrigerated trailers to transport ice for consumption by the troops that had previously been used as temporary morgues without first sanitizing them.
The government is suing KBR, La Nouvelle and First Kuwaiti under the False Claims Act, as well as the Anti-Kickback Act.
The lawsuit was originally filed by Bud Conyers, a former KBR/Halliburton truck driver, under the whistleblower provision of the False Claims Act. The False Claims Act allows private parties with knowledge of fraud against the government to sue on behalf of the government and share in the recovery. The False Claims Act also permits the government to investigate the allegations made in the whistleblower’s complaint and decide whether to intervene in the lawsuit, which it has elected to do in this case.
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 uncover fraud of every kind perpetrated against our 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.