LG Chem Michigan to Settle False Claims for $1.2M; DOE to Receive $8.5K

Posted: 11/12/2013  browse the blog archive

LG Chem Michigan, Inc. (LGCMI) will pay the United States $1.2 million to resolve allegations, under the False Claims Act, that the company improperly sought and obtained federal funds to pay employees who were engaged in recreational and volunteer activities, the U.S. Attorney’s Office announced last week. This amount is in addition to the $8,500 that LGCMI refunded to the U.S. Department of Energy (DOE) based on the same allegations.

DOE awarded LGCMI over $150 million in funds under the American Recovery and Reinvestment Act to construct and operate a lithium-ion battery manufacturing plant. The United States alleged that before LGCMI transitioned battery production from foreign sources to their plant, LGCMI submitted claims to obtain the federal share of wages and benefits paid to domestic workers who were engaged in non-work activities such as watching movies, playing games and performing volunteer work. The United States further alleged that in response to governmental inquiries about those activities LGCMI failed to fully disclose the number of employees involved in those activities, the nature and scope of those activities, and the resulting losses to the government.

Under the False Claims Act, private parties with knowledge of fraud against the government may sue on behalf of the government and share in the recovery.  Had there been a whistleblower in this case, their portion of the settlement may have been anywhere from 15 to 30 percent.

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.