L-3, Vertex and Integrated Systems: One Person’s Arrival, Another Person’s Bill

In the L-3, Vertex and Integrated Systems settlement, the companies agreed to pay $4.63 million to resolve allegations of inflated deployment-center labor hours. The government alleged that an individual’s billed time could start when somebody else arrived or end when somebody else left. If you handled deployment processing or billing, that is a discrepancy you may recognize.

The Justice Department’s September 28, 2015 announcement named L-3 Communications Corporation, Vertex Aerospace LLC and L-3 Communications Integrated Systems LP. The alleged labor overbilling involved independent contractors preparing to deploy through Fort Benning, Georgia, and Fort Bliss, Texas.

Deployment-Center Labor at Fort Benning and Fort Bliss

L-3 performed rotary aviation maintenance and support services for the Army in Afghanistan, Iraq, Egypt and Kuwait under contracts with the Air Force. Before overseas deployment, the Continental U.S. Replacement Centers provided orientation briefings, training, health screenings, payroll processing and other administrative preparation. The disputed labor charges concerned time at those centers before the contractors reached their overseas posts.

The government alleged that, from 2006 through November 2011, L-3 knowingly billed for each independent contractor using the earliest arrival or latest departure of another person who processed through the center that day. The individual’s own time at the center gave way to somebody else’s schedule. That substitution is the heart of the allegation: the charge followed another person’s attendance.

We call that billing by somebody else’s clock. Under the alleged formula, the government’s bill could grow without the individual spending another minute at the center. For someone who handled processing or knew the actual arrival and departure times, the contradiction would be concrete.

A billed hour connects attendance to government money through the contract’s payment terms. The contract identifies the work, the basis for payment and the evidence supporting the charge. Its line items and modifications explain which hours belong on which bill.

For deployment-center billing, we connect the individual’s time to the entry the contractor used and the payment request it produced. An attendance record answers when the person was there. A time entry and invoice show what the contractor asked the government to fund. The instruction or approval behind the entry helps explain how the difference arose and who knew about it.

Who Brought the Case and Investigated the Billing?

A former L-3 independent contractor brought the False Claims Act qui tam case behind this settlement. The Justice Department announced that the whistleblower would receive a share of the recovery. A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

The investigation involved special agents from the Defense Criminal Investigative Service and the Army Criminal Investigation Command’s Major Procurement Fraud Unit, with assistance from the Defense Contract Audit Agency. The U.S. Attorney’s Office for the Northern District of Georgia and the Justice Department’s Civil Division reached the civil settlement.

What Proof Do You Need as a Whistleblower?

For a deployment-center labor case, the useful proof connects actual attendance with billed time and the decisions that produced the charge. We examine the records behind the payment request with the person who understands the work. Arrival and departure information becomes especially useful when it can be matched to the same individual and day on the contractor’s bill.

The person who handled deployment processing may understand the attendance record without seeing the invoice. A billing employee may see the charge without knowing when the individual actually left. We work with insiders to connect those views, because the government payment sits at the end of that chain.

A separate Defense Department Inspector General audit found that a contractor supporting the Electromagnetic Pulse Commission might have been paid $118,755 more than its contract allowed. In its April through September 2018 report to Congress, the inspector general described contracting officers directing approval of invoices containing questionable hours without requiring Defense Contract Audit Agency review. The person familiar with the work can supply information that the approval process missed.

The Same Labor Question in Other Defense Contracts

MPRI agreed to pay $3.2 million over alleged false labor charges for employees on leave outside Afghanistan under an Army support contract. Unlike L-3’s alleged use of another person’s attendance, the government alleged that Huntington Ingalls Industries charged labor on one Navy or Coast Guard shipbuilding contract to another.

You Know Who Was Actually There

If you know the deployment schedule, the attendance records or how processing hours reached an invoice, talk with our whistleblower experts about the billing you saw. We build the case with you around that knowledge and bring in defense contractor whistleblower lawyers who understand labor charges and military support contracts. We stay beside you as the account of who was actually there becomes a case about what the government paid for.