Judge Boosts UTC’s Penalty to $664M From $473M

A federal judge increased United Technologies Corp.’s False Claims Act penalties by 40 percent, to $664.4 million, Reuters reported earlier this month.  Last month, Connecticut-based UTC was found liable for $473 million in damages and penalties arising from a contract with the U.S. Air Force for fighter aircraft engine, the highest recovery ever obtained by the government in a False Claims Act case.

United Technologies allegedly proposed prices for the engine contract that misrepresented how the company calculated those prices.  Specifically, the government alleged that United Technologies failed to include in its price proposal historical discounts that it received from suppliers, and instead knowingly used outdated information that excluded such discounts.  As a result, the government paid hundreds of millions more than it otherwise would have paid for the engines.

The U.S. Department of Justice requested the increase, in order to reflect interest on the $473 million judgment.  Interest rates on the award varied from 6 percent to 8 percent per year, and the interest imposed dated back to 1986.

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.