Science Applications International Corp.—now Leidos Holdings Inc.—has agreed to pay $1.5 million to resolve a federal False Claims Act, or FCA, lawsuit alleging conflicts of interest related to the company's work for the Nuclear Regulatory Commission more than 10 years ago. The U.S. Dept. of Justice, which announced the agreement on Oct. 21, said the settlement resolves the claims and that there is no determination of liability.
SAIC signed contracts in 1992 and 1999 with the NRC to help develop a regulation for the commercial release or recycling of material with low radioacitivy levels.
The government alleged SAIC, Reston, Va., falsely certified it had no conflicting business arrangements, though it was a subcontractor to British Fuels Ltd. and a consultant for Bechtel Jacobs Co., both Dept. of Energy contractors at Oak Ridge, Tenn. In 2008, a jury found SAIC violated the FCA and breached its NRC contract by having conflicts of interest. SAIC contended its contract didn't state that conflict-of-interest compliance was a condition of payment.
In 2010, a federal appeals court upheld the district court's 2008 judgment regarding liability and damages on the breach-of-contract claim, but it vacated the district-court judgment on FCA liability. It also remanded the case for a new trial.
Leidos pursued the lengthy litigation "because it steadfastly rejected the government's interpretation of its conflict regulations and [FCA] allegations," said spokeswoman Melissa Koskovich. "Leidos agreed to settle the matter for a non-material amount to finally resolve these allegations with no admission of liability and to avoid the additional expense of a new trial."
In 2013, SAIC spun off some operations as Leidos Holdings, whose businesses include national security, engineering and health care. Leidos ranked at No. 40 on ENR's 2014 Top 500 Design Firms List.