$2 Million FCA Settlement
Nathan M. Peak and Ashcraft & Gerel, LLP announce that Guldmann, Inc. has agreed to settle a False Claims Act (FCA) case for a total of $2 million. The case was declined by the Department of Justice in October, 2013 and was litigated by Mr. Peak and co-counsel, Kevin Darken of the Barry A. Cohen Legal Team for over two years, resulting in the successful settlement on behalf of their client/whistleblower, Per Bukh.
The settlement resolves claims that 1) Guldmann, Inc. sold patient lift systems to Veterans Administration hospitals that violated the FAR/GSA pricing obligations under Guldmann’s government contract; and 2) Guldmann, Inc. sold patient lift systems to the Veterans Administration that were manufactured in countries that violated the Trade Agreements Act (TAA).
The case was initiated by whistleblower, Mr. Bukh, under the qui tam provisions of the False Claims Act in June, 2011. The government did an initial investigation and declined to intervene in the case. Mr. Peak and Mr. Darken, as private counsel for Mr. Bukh, then aggressively litigated the case on behalf of their client and the U.S. government. The case settled after two years of litigation and 5 weeks short of trial.
GSA and FAR regulations require that companies doing business with the U.S. government must follow certain regulatory pricing guidelines, which peg the price at which government contractors can sell items to the government to that contractor’s best commercial customer. Any deviation from this scheme can be a violation of those pricing requirements.
Likewise, the TAA requires that contractors selling goods to the U.S. government must manufacture or produce these products in countries in which the U.S. has a trade agreement with, or sales of those products could run afoul of the Trade Agreements Act (TAA). For example, products manufactured in China, whom the U.S. does not have a trade agreement with, and sold to the U.S. government could violate the TAA.
Mr. Bukh was comptroller of Guldmann, Inc. from 2006 – 2010. “Mr. Bukh courageously came forward as a whistleblower, at great personal risk to bring to light these practices, which resulted in this successful result for the U.S. tax payer,” says Mr. Peak.
Mr. Peak’s practice is 100% devoted to representing whistleblowers in declined and intervened qui tam cases. The False Claims Act (FCA) allows private citizens to sue companies for defrauding the government and recover those fraudulent payments on the government’s behalf. The government can either “intervene” and take over the matter, or as was the case with this litigation, the government can decline intervention and private counsel, such as Mr. Peak, has the ability under the FCA to litigate the matter in place of the government. A whistleblower (termed “relator”) is entitled to 15 to 25 percent of those funds returned to the government in those cases the government intervenes in. A whistleblower/relator is entitled to 25 to 30 percent of those funds returned to the government in those cases litigated by private counsel.
If you have any questions regarding the False Claims Act or government fraud, please feel free to contact Mr. Peak at 855-379-0385.
See United States ex rel. Per Bukh v. Guldmann, Inc., United States District Court for the Middle District of Florida, (8:14-cv-1089).