Feds Intervene in False Claims Act Case Against Symantec Corporation

The Justice Department has intervened in a lawsuit against Symantec Corporation.

The Department alleges that Symantec submitted false claims to the United States on a General Services Administration (GSA) software contract.

The suit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private parties to sue on behalf of the government for the submission of false claims for government funds and to receive a share of any recovery.

The False Claims Act also permits the government to intervene in such lawsuits, as it has done in this case.

The whistleblower in this case was a Symantec employee, Lori Morsell. She is being represented by Christopher Mead, a partner at London & Mead in Washington, D.C.

Symantec is being represented by Jonathan Aronie of Sheppard Mullin in Washington, D.C.

In a regulatory filing earlier this year, Symantec said that it was “fully cooperating with the investigation and in January 2014 met with representatives of the government who presented us with an initial analysis of our actual damages exposure in the amount of approximately $145 million.”

“We are currently in the process of evaluating the government’s initial analysis,” the company said. “Considering the preliminary stage of the negotiated resolution process with the government, we are currently unable to determine a precise range of estimated losses resulting from this matter.”

Symantec is a Fortune 500 company located in Mountain View, California, and it sells a variety of computer security products. Symantec reported over $6 billion in revenue in 2011.

In 2007, Symantec entered into a contract with GSA that allowed Symantec to sell software and related items directly to federal purchasers.

The case alleges that Symantec knowingly provided the United States with inaccurate and incomplete information about the prices it was offering to its commercial customers during the negotiation and performance of the contract.

GSA used Symantec’s disclosures about its commercial sales practices to negotiate the minimum discounts Symantec was required to provide government agencies that bought Symantec software.

The contract required Symantec to update GSA when commercial discounts improved and extend the same improved discounts to government purchasers.

The suit contends that Symantec misrepresented its true commercial sales practices, ultimately leading to government customers receiving discounts far inferior to those Symantec gave to its commercial non-government customers.

The contract at issue was in place from 2007 to 2012 and involved hundreds of millions of dollars in sales.

The lawsuit is pending in the District of Columbia.

Copyright © Corporate Crime Reporter
In Print 48 Weeks A Year

Built on Notes Blog Core
Powered by WordPress