Related Federal Cases
- Berg Companies Inc, Bid-Rigging Scheme, Washington 2023 · New Mexico
- Amgen Inc, Pharmaceutical Misrepresentation, California 2024 · New Mexico
- Live Nation, Antitrust Lawsuit, New York NY, 2024 · New Mexico
- Amgen Pays $71M for Pushing Drugs Off-Label · New Mexico
- John Doe, Western Union Scam, California 2022 · New Mexico
Berg Companies Inc. Bid Rigging, Washington 2021
A defense contractor has agreed to pay $3.3 million to resolve allegations that it violated the False Claims Act by submitting, or causing the submission of, false claims under prime vendor contracts with the Defense Logistics Agency (DLA), which the Department of Defense (DoD) uses to purchase goods and services.
Berg Companies Inc., based in Spokane, Washington, manufactures rigid wall shelters and sells them to the federal government, including through various prime vendor programs. In September 2019, Berg was acquired by Hunter Defense Technologies, Inc., which is a defense contractor that is based in Solon, Ohio.
Berg was a vendor to Noble Sales Co. Inc. doing business as Noble Supply & Logistics (Noble), which is a Boston-based prime contractor to DLA for Maintenance, Repair & Operations (MRO) contracts for the European Command. Under the MRO contracts, the DoD can place orders for goods and services through Noble. Noble is then required to solicit bids from two independently competing vendors for transactions below $25,000 and from three independently competing vendors for transactions at or above $25,000.
According to DLA, MRO contracts are “a partnership aimed at achieving infrastructure savings, inventory cost reductions and favorable product pricing through leveraged buying.”
Pursuant to the settlement agreement, Berg admitted that, from 2019 to 2021, Berg coordinated with Noble and two other Noble vendors to submit inflated quotes for Berg-made rigid wall shelters so that the other vendors would win the awards at inflated prices. In the first scheme, Berg admitted that it coordinated and submitted inflated quotes on two solicitations for the sale of 10 Berg-made rigid wall shelters that Noble awarded to a New Mexico-based vendor. In the second scheme, Berg admitted that it coordinated and submitted inflated quotes on 26 solicitations for the purchase of 29 Berg-made rigid wall shelters that Noble awarded to a Florida-based vendor.
“Bid rigging of this type inhibits competition on the products and on prices, thereby creating the risk that the government is purchasing inferior products at exorbitant prices,” said Assistant Attorney General Brett Shumate of the Justice Department’s Civil Division. “This settlement reinforces the Department’s commitment in using the FCA to pursue anti-competitive fraud.”
“As evidenced in this settlement agreement, these contractors manipulated and undermined the fair and open bidding process designed to save our military and taxpayers money,” said U.S. Attorney Leah B. Foley for the District of Massachusetts. “We commend Berg for cooperating with the government to resolve this matter and taking responsibility for this conduct. As this settlement demonstrates, not only will my Office continue to use the False Claims Act to help root out fraud, waste and abuse involving taxpayer funds, but it will reward those that accept responsibility and cooperate with the government.”
“Collusion in government contracting erodes public trust, distorts fair competition, and drives up costs for taxpayers and service members,” said U.S. Attorney Ryan Ellison for the District of New Mexico. “Such conduct undermines the integrity of the procurement process and betrays the public’s expectation that government funds will be used responsibly. This resolution demonstrates our unwavering commitment to protecting taxpayer dollars, ensuring a level playing field for all businesses, and holding accountable those who seek to profit by manipulating federal contracting. We will continue to work closely with our law enforcement partners to defend the integrity of government procurement and safeguard the interests of the American people.”
Key Facts
- State: Federal
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
ðŸâ€Â’ Get the grimiest stories delivered weekly. Subscribe free →
MORE FEDERAL CRIME NEWS
US NewsUS NewsUS NewsUS News