Gen Digital Inc. (formerly Symantec Corp.) knowingly overcharged the General Services Administration. Now the company is required to pay a hefty judgment after a decade of False Claims Act litigation.

Located in Tempe, Arizona, Gen Digital Inc. will pay $55.1 million. The company is required to shell out $16.1 million in damages and $36.8 million in civil penalties, in addition to post-judgment interest and costs.

Principal Deputy Assistant Attorney General Brian M. Boynton, head of the Justice Department’s Civil Division said: “The department will hold accountable contractors that knowingly overcharge the United States to enrich themselves. The years spent litigating this case and taking it to trial demonstrate the department’s steadfast commitment to protecting taxpayer funds.”

After a four-week bench trial in February and March 2022, the trial court found Symantec liable for making knowing false claims to the United States. It misrepresented its commercial sales practices during the negotiation and subsequent performance of a General Services Administration (GSA) contract. The court determined that Symantec made false statements to GSA during contract negotiations in 2006 and early-2007. The company continued to falsely certify during the contract’s performance through September 30, 2012, that its disclosures of commercial sales practices were complete, accurate, and current. The false disclosures caused GSA to accept and continue to pay higher prices than it would have if it knew about Symantec’s real commercial pricing practices.

The court also determined that Symantec repeatedly violated the Price Reduction Clause, a standard term in Multiple Award Schedule contracts. This clause requires the contractor to maintain GSA’s price position relative to a specified customer or customer category, as agreed upon during contract negotiations. These violations resulted in the United States being denied discounts that it was entitled to.

GSA Deputy Inspector General Robert C. Erickson said, “The United States deserves fair prices and accurate information from GSA contractors. This outcome is the result of hard work and dedication by a cross-functional team from the U.S. Department of Justice, GSA and GSA Office of Inspector General.”

Gen Digital Inc.’s payment concludes the lawsuit filed under the qui tam or whistleblower provision of the False Claims Act, which allows private parties to file suit on behalf of the United States for false claims and receive a portion of the government’s recovery. The Act permits the United States to intervene and take responsibility for litigating these cases. The qui tam case is captioned United States ex rel. Morsell v. Symantec Corp., Civ. A. No. 12-0800 (DDC), and was brought by Lori Morsell, who administered the contract at issue for Symantec. Morsell’s share of the recovery has not been determined yet.

If you have any information about government contract fraud or if you would like to learn more about the False Claims Act or what it means to be a whistleblower, please don’t hesitate to contact us.  We will connect you with an experienced member of our whistleblower team.

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