NASA Johnson Space Center False Claims Act Case Settles for $3 Million

A Houston roofing company — Crown Roofing Services — will pay $3 million to settle allegations that it made kickback payments to secure a series of roofing contracts at the National Aeronautics and Space Administration’s (NASA) Johnson Space Center beginning in July 2005.

In 2005, Crown Roofing Services was awarded a series of prime roofing contracts the Space Center.

This aroused the suspicion of NASA investigators and Crown employees turned whistleblowers Bobby Garrison and Rudolfo Gaona.

Garrison and Gaona began keeping a close watch to see if their suspicions were justified.

They cooperated and assisted with the NASA investigation.

By early 2007 the two were sure they could prove that NASA contracting officers Jameel Hattab and Larry Shelmire, who were responsible for recommending the award of prime contracts for roofing work at the Houston facility, were taking kickbacks from Crown to award it the business.

The bid-rigging scheme they uncovered was simple but effective: to get the prime NASA contracts that Hattab and Shelmire could arrange, Crown gave subcontracts for part of the work to a small engineering company secretly owned by Hattab.

Garrison and Gaona filed a False Claims Act lawsuit in Houston, Texas.

They were represented by Vincent McKnight of McKnight & Kennedy in Silver Spring, Maryland.

In 2009 the Department of Justice intervened in the case and named Crown Roofing Services, Inc. and its former owners, Ray Palmer and R.D. Chatmon, as defendants.

The civil case remained on hold while the government conducted a criminal investigation of the relationship between Crown and the NASA contracting officers.

Hattab and Shelmire pled guilty in federal court in Houston to federal conflict of interest charges.

Garrison and Gaona will receive $540,000 of the $3 million whistleblower award.

“This is an example of how responsible citizens can expose fraud against the government and help protect our taxpayer dollars,” McKnight said.  “It takes a whistleblower to come forward with critical inside information, because fraud schemes are inherently stealthy.  I’m proud of my clients for coming forward and doing something effective to stop it.”

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