National Association of Government Contractors

False Claims Settlement of $45M for CA, Inc.

The Department of Justice recently announced NY-based contractor, CA Inc. will pay $45 million to resolve allegations under the False Claims Act that it made false statements and claims in the negotiation and administration of a General Services Administration contract. CA is an information technology management software and services company.

"Today's settlement demonstrates our continuing vigilance to ensure that contractors deal forthrightly with federal agencies when seeking taxpayer funds," said Acting Assistant Attorney General Chad A. Readler of the Justice Department's Civil Division in statement.  "We will take action against contractors who withhold information and cause the government to pay more than it should for commercially available items."

The settlement resolves allegations related to a GSA contract awarded to CA for software licenses and maintenance services.  Under Multiple Award Schedule (MAS) GSA pre-negotiates prices and contract terms for subsequent government- wide orders by federal agencies.  

At the time of CA's contract, contractors were to fully disclose to GSA how they conducted business in the commercial marketplace so that GSA could use that data to negotiate a fair price for government agencies.  The contract also contained a price reduction clause that set forth when the contractor had to reduce the prices it charged to the government if its prices to commercial customers improved. 

This settlement resolves allegations that CA did not fully and accurately disclose its discounting practices to GSA contracting officers.  Specifically, the agreement resolves claims that CA provided false information about the discounts it gave commercial customers for its software licenses and maintenance services at the time the contract was negotiated in 2002 and was extended in 2007 and 2009.

Additionally, the settlement resolves claims that CA violated the price reduction clause in the contract by not providing government customers with additional discounts when commercial discounts improved.   

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