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Arleigh Burke Class Destroyers Type: False Claims Act
Since 1991 the United States Navy has been commissioning a new fleet of state of the art Arleigh Burke class destroyers, equipped with the latest Aegis weapons system and the capability to launch nuclear cruise missiles as well as conventional ordinances. All electrical power for the operation of these ships is provided by a series of three generator sets. Without the electrical power generated by these generator sets, these billion dollar destroyers are blind and defenseless.
These generator
sets have
been designed
and produced
by: Allison
Engine Company
(formerly
a division
of General
Motors Corporation
and now owned
by Rolls
Royce); General
Tool Company;
and Southern
Ohio Fabricators.
A False Claims
Act case
was brought
by Roger
Sanders and
Roger Thacker,
two former
employees
of the assembler
of the generator
sets, General
Tool Company in 1994.
These relators
worked hand
in glove
with the
Navy Criminal
Investigative
Service for
years before
filing their
False Claims
Act action
alleging
that: the
generator
sets were
not manufactured
or tested
according
to Navy specifications
and standards;
and that
the Navy
has been
overcharged
for redesigned
versions
of the generator
sets which cost less to produce.
A United States Magistrate Judge in Cincinnati found that the United States had been overcharged for the Gen Sets and that the Gen Sets had not been properly tested. After a 5 week trial a federal judge in Dayton overturned those rulings and determined that even though the case was brought only against Navy Subcontractors, invoices from the Navy’s prime shipyard contractors were required to be proven. The Sixth Circuit Court of Appeals reversed the trial judge and determined that "a reasonable jury could find for relators [Sanders and Thacker]" and remanded this 12-year old case for a new trial.
Case: United States ex rel. Sanders et al. v. Allison Engine Case No. C-1-95-970 (S.D. Ohio)