Electrical connector manufacturer agrees to pay $11 million to resolve FCA allegations

ITT Cannon has agreed to pay $11 million to resolve alleged False Claims Act (“FCA”) allegations that it supplied electrical connectors to the military that had not been properly tested. These untested connectors were then sold directly to the government and other government contractors, which were then used in technology and equipment sold to the Government. The lawsuit, U.S. ex rel. Tatgenhorst v. ITT Corporation, PEI/Genesis, Inc., No. 14-7424 JAK (C.D.Cal. 2019), was brought by a former regional quality manger at ITT, Ralph Tatgenhorst, under the whistleblower, or qui tam provisions of the FCA. Under this provision, private individuals are entitled to bring an action on behalf of the government and receive a percentage of the recovery, if any, for his or her efforts in bringing the case to the attention of the federal government. Mr. Tatgenhorst will receive roughly $2.1 million for his share of the settlement amount. 

The settlement alleged that from September 2008 to March of 2017, ITT did not conduct the required periodic testing on six models of electrical connectors. In December of 2010, the government learned that ITT had not done the required testing but assured the government that it would conduct remedial testing and send the results to the government. However, in February of 2011, ITT had numerous failures with its remedial testing, which were not disclosed to the government but rather, ITT disclosed that it was merely behind on the remedial testing. 

In March of 2017, the Defense Logistics Agency (“DLA”) issued an order halting the shipment of the six connections. A couple of months later, ITT issued notices disclosing that it had failed to conduct the required testing, stating its test failures, and changes in the process, materials, construction, and design of the connectors. These connectors were originally listed on the Qualified Products List (“QPL”), which lists products that have met certain qualification requirements as outlined for Military Specifications. These requirements are uniform engineering and technical requirements for products used by the Department of Defense. However, DLA removed ITT’s six connectors from the list, which precluded ITT from selling parts to the military. In an effort to show compliance, ITT had re-qualified one of its connectors to be put back on the QPL.

Contractors who deal with the government are bound by strict testing requirements. The goal is to promote truthful disclosures regarding test results, especially given that the results will determine whether the product is viable or not. Are you an individual who has knowledge of your present or past employer committing fraud against the government? If so, consider speaking with an attorney today. Josh Borsellino is a FCA attorney that understands the laws and regulations surrounding qui tam lawsuits. Call him today to discuss your questions about the federal whistleblower statute. Josh can be reached at 817.908.9861 or 432.242.7118. 

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