ITT Cannon to Pay $11M to Settle False Claims; Whistleblower to Get $2M

Posted: 07/16/2019  browse the blog archive
ITT Cannon to Pay $11M to Settle False Claims; Whistleblower to Get $2M

ITT Cannon has agreed to pay the United States $11 million to settle False Claims Act allegations that it supplied electrical connectors to the military that had not been properly tested, the Justice Department announced today.  ITT sold the untested connectors both directly to the Government and through distributors and other government contractors which incorporated them into technology and equipment sold to the Government. 

The settlement resolves allegations that ITT did not conduct the required periodic testing on six models of electrical connectors.  The Government learned that ITT had not done this testing and ITT promised the Government that it would conduct remedial testing and report the result to the Government.  Shortly thereafter, ITT experienced several failures in its remedial testing.  ITT did not immediately disclose these failures but represented to the Government that it was merely behind in the remedial testing. 

The Defense Logistics Agency (DLA) issued an order stopping the shipment of the six connectors.  ITT issued six Government Industry Data Exchange Program notices (GIDEP) disclosing to industry its failure to conduct required testing, its test failures, and changes in the processes, materials, construction, sourcing and design of the connectors.  DLA then removed the six ITT connectors from the Qualified Products List (QPL).  The QPL lists products that have met the qualification requirements set forth in the applicable Military Specifications (Mil Specs), which are uniform engineering and technical requirements for certain products used by the Department of Defense.  DLA’s removal of ITT from the QPL precluded ITT from selling parts to the military covered by the Mil Specs.  Recently, ITT has requalified one of the connectors for sale to the Government.

The settlement resolves allegations filed in a lawsuit by Ralph Tatgenhorst, the former regional quality manager at ITT’s Santa Ana facility, in federal court in Los Angeles, California, under the whistleblower (or “qui tam”) provisions of the False Claims Act.  These provisions permit private individuals to sue on behalf of the Government for false claims and to share in any recovery.  Mr. Tatgenhorst will receive $2,090,000 as his share of the settlement amount. 

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.