L-3 to Pay $4M to Settle Overbilling Claims

(CN) - One of the United States' largest defense contractors will pay $4.63 million to settle claims it overcharged the federal government during military-sponsored training, the Justice Department announced.

Whistleblower Robert Martin, a sheet metal mechanic contracted by L-3 Communications Corporation, was one of the thousands of L-3 personnel deployed around the world to support the U.S. military.

Martin filed a lawsuit in Georgia under the False Claims Act, alleging L-3 overbilled the U.S. government for military training contractors received before they were deployed overseas.

According to Martin's complaint, the U.S. military contracted L-3 to service and maintain its helicopters and rotary aircraft across the globe, and particularly in Afghanistan, Iraq, Egypt, and Kuwait.

Before L-3 employees deployed, the U.S. military put them through a training course at Fort Bliss, Texas and Fort Benning, Georgia.

Martin claimed in his May 2010 complaint that L-3 overbilled the U.S. government in six ways:

"(1) by billing for training, which should not be billed at all; (2) by billing the Government for time its employees spend in L-3's own internal training; (3) by significantly inflating the number of hours that its employees spend in CRC training ; (4) by billing a day of travel ; (5) by billing overtime during training, which the Government has not agreed to pay ; and (6) by holding its employees in Kuwait, yet billing that time as if the employees were working on the Contract."

In announcing the settlement last week, the U.S. Justice Department said an investigation of Martin's claims found that L-3 told its employees to bill the time it took "for the entire group to process through the CRC [training] each day, rather than the actual hours spent by each individual."

"The United States alleges that from 2006 through November 2011, L-3 knowingly overcharged the government for time their independent contractors spent at the CRCs by billing for each individual not based on the actual time that individual spent at the CRC, but based instead on the earliest arrival or latest departure time of any other individual who also processed through the center that same day," the Justice Department said..

Attorney Lee Wallace, who represented Martin, told Courthouse News, "This case proves you don't have to be a CEO or an accountant to be a whistleblower. You just have to hate fraud."

Martin will receive $798,675 for his role in uncovering the wrong-doing. L-3 will pay an additional $186,400.56 in attorneys' fees. Wallace told Courthouse News that Martin wants to retain a degree of privacy and thus declined to comment for this article.

Wallace said L-3 still holds its contract with the American government.

No liability was determined in the settlement agreement and L-3 denies the allegations.

Neither the company nor the Department of Defense responded to requests for comment.

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