SAIC Found Liable for 77 False Claims Act Violations
WASHINGTON, D.C. - A federal jury sitting in Washington concluded a four-week trial on 31 July, finding Science Applications International Corporation (SAIC) liable for violating the False Claims Act and breaching a contract with its client, the Nuclear Regulatory Commission (NRC).
The jury found that SAIC knowingly submitted 60 false claims for payment and knowingly made 17 false statements to get claims paid on two NRC contracts in the 1990s.
"The NRC is pleased the jury recognized SAIC's conflicts of interest and ruled in favor of the government," said Bill Borchardt, the NRC's Executive Director of Operations. "The verdict vindicates our earlier decision to terminate SAIC's contract; we do not and will not tolerate conflicts of interest where public health and safety is concerned."
The jury awarded the United States $1.97 million in damages, which are tripled to $5.91 million under the False Claims Act. SAIC must also pay penalties of between $5,000 and $10,000 for each of the 77 false claims and statements that it submitted to the NRC.
The jury found SAIC failed to avoid and disclose conflicts of interests that had the potential to bias its work helping the NRC create a rule that would govern whether radioactive materials from nuclear facilities could be released or recycled. The jury found that SAIC knowingly concealed business relationships with private corporations that stood to benefit from the rule.
SAIC's conflicting relationships were exposed by a private citizen at a public meeting held in November of 1999 and the NRC terminated SAIC's contract for conflicts of interest soon thereafter. The U.S. Department of Justice, Civil Division, and the NRC's Office of General Counsel represented the United States in the case, with investigative support from the NRC's Office of Inspector General.
Companies found to have submitted false claims may be subject to suspension or debarment. At this point, SAIC is not listed in the GSA's Excluded Parties List System. The Federal Times is reporting that the NRC's general counsel is currently reviewing the decision and will make a decision on next steps. SAIC has no active contracts with the NRC at this point.
SAIC spokesperson Melissa Koskovich said in the Federal Times report that the firm is disappointed with the verdict. She said no bias was actually proven in the case, and that the NRC had no issued standards for it to follow. According to Koskovich, the jury concluded there was a potential for bias, but any potential bias had no effect on the services it provided to the NRC.