FROM: U.S. DEPARTMENT OF JUSTICE
Wednesday, October 31, 2012
United States Sues Virginia-based Contractor for False Claims Under Contract for Security in Iraq
Allegedly Billed US for Security Guards Who Did Not Meet Contract Requirements
The United States has filed a complaint against a Virginia-based contractor alleging that the company submitted false claims for unqualified security guards under a contract to provide security in Iraq, the Justice Department announced today. The company, Triple Canopy Inc. is headquartered in Reston, Va.
In June 2009, the Joint Contracting Command in Iraq/Afghanistan (JCC-I/A) awarded Triple Canopy a one-year, $10 million contract to perform a variety of security services at Al Asad Airbase – the second largest air base in Iraq. The multi-national JCC-I/A was established by U.S. Central Command in November 2004, to provide contracting support related to the government’s relief and reconstruction efforts in Iraq.
The government’s complaint alleges that Triple Canopy knowingly billed the United States for hundreds of foreign nationals it hired as security guards who could not meet firearms proficiency tests established by the Army and required under the contract. The tests ensure that security guards hired to protect U.S. and allied personnel are capable of firing their AK-47 assault rifles and other weapons safely and accurately. The government also alleges that Triple Canopy’s managers in Iraq falsified test scorecards as a cover up to induce the government to pay for the unqualified guards, and that Triple Canopy continued to bill the government even after high-level officials at the company’s headquarters had been alerted to the misconduct. The complaint further alleges that Triple Canopy used the false qualification records in an attempt to persuade the JCC-I/A to award the company a second year of security work at the Al Asad Airbase.
"For a government contractor to knowingly provide deficient security services, as is alleged in this case, is unthinkable, especially in war time," said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of the Department of Justice. "The department will do everything it can to ensure that contractors comply with critical contract requirements and that contractors who don’t comply aren’t permitted to profit at the expense of our men and women in uniform and the taxpayers at home who support them."
"We will not tolerate government contractors anywhere in the world who seek to defraud the United States through deliberate or reckless conduct that violates contractual requirements and risks the security of government personnel," said Neil H. MacBride, U.S. Attorney for the Eastern District of Virginia.
The government’s claims are based on a whistleblower suit initially filed by a former employee of Triple Canopy in 2011. The suit was filed under the qui tam, or whistleblower, provision of the False Claims Act, which allows private persons to file suit on behalf of the United States. Under the act, the government has a period of time to investigate the allegations and decide whether to intervene in the action or to decline intervention and allow the whistleblower to go forward alone.
This matter was investigated by the U.S. Attorney’s Office for the Eastern District of Virginia; the Commercial Litigation Branch of the Justice Department’s Civil Division; and the Army Criminal Investigative Command (CID) and Defense Criminal Investigative Service (DCIS) of the Department of Defense.
The claims asserted against Triple Canopy are allegations only; there has been no determination of liability. The government is not aware of any injuries that occurred as a result of the alleged misconduct.
Friday, November 2, 2012
Thursday, November 1, 2012
U.S. NLRB ACTING GENERAL COUNSEL'S ANALYSIS OF TWO EMPLOYEE HANDBOOK'S 'AT-WILL' EMPLOYMENT CLAUSES
FROM: U.S. NATIONAL LABOR RELATIONS BOARD
NLRB Acting General Counsel Lafe Solomon today released an analysis of at-will employment clauses in two employee handbooks, finding that both are lawful under the National Labor Relations Act.
Charges filed with the NLRB alleged that the handbooks, distributed by a California trucking company and a restaurant in Arizona, defined at-will employment so broadly that employees would reasonably think they could not engage in activity protected by the National Labor Relations Act. However, the two memos prepared by the NLRB’s Division of Advice in Washington DC found that they were not overly broad.
As both memos explain, an employer violates the Act by maintaining work rules or policies that explicitly prohibit NLRA-protected union or concerted activity, such as joining a union or discussing terms and conditions of employment with coworkers. Even if not explicit, a rule can be unlawful if employees would reasonably construe the language to prohibit such activity.
The clause in a handbook maintained by Rocha Transportation in Modesto, California advised drivers that their employment is at-will and may be terminated at any time. "No manager, supervisor, or employee of Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will," it continued. "Only the president of the Company has the authority to make any such agreement and then only in writing." The Division of Advice Memo notes that this clause explicitly states that the relationship can be changed, and so employees would not reasonably assume that their NLRA rights are prohibited.
At Mimi’s Café in Casa Grande, Arizona, the Teammate Handbook description of at-will employment includes the sentence: "No representative of the Company has authority to enter into any agreement contrary to the foregoing "employment at will" relationship." The Advice Memo found this was not unlawfully broad because the clause does not require employees to agree that the employment relationship cannot be changed in any way, but merely highlights that the employer’s representatives are not authorized to change it.
The Advice Memos are provided as guidance for employers and human resource professionals in a developing area that has drawn considerable attention recently. They distinguish the language in the two handbooks from another at-will clause that was recently found by an NLRB Administrative Law Judge to be unlawfully broad. That case was settled before Board review.
Because Board law in this area remains unsettled, the Acting General Counsel is asking all Regional Offices to submit cases involving employer handbook at-will provisions to the Division of Advice for further analysis and coordination.
NLRB Acting General Counsel Lafe Solomon today released an analysis of at-will employment clauses in two employee handbooks, finding that both are lawful under the National Labor Relations Act.
Charges filed with the NLRB alleged that the handbooks, distributed by a California trucking company and a restaurant in Arizona, defined at-will employment so broadly that employees would reasonably think they could not engage in activity protected by the National Labor Relations Act. However, the two memos prepared by the NLRB’s Division of Advice in Washington DC found that they were not overly broad.
As both memos explain, an employer violates the Act by maintaining work rules or policies that explicitly prohibit NLRA-protected union or concerted activity, such as joining a union or discussing terms and conditions of employment with coworkers. Even if not explicit, a rule can be unlawful if employees would reasonably construe the language to prohibit such activity.
The clause in a handbook maintained by Rocha Transportation in Modesto, California advised drivers that their employment is at-will and may be terminated at any time. "No manager, supervisor, or employee of Rocha Transportation has any authority to enter into an agreement for employment for any specified period of time or to make an agreement for employment other than at-will," it continued. "Only the president of the Company has the authority to make any such agreement and then only in writing." The Division of Advice Memo notes that this clause explicitly states that the relationship can be changed, and so employees would not reasonably assume that their NLRA rights are prohibited.
At Mimi’s Café in Casa Grande, Arizona, the Teammate Handbook description of at-will employment includes the sentence: "No representative of the Company has authority to enter into any agreement contrary to the foregoing "employment at will" relationship." The Advice Memo found this was not unlawfully broad because the clause does not require employees to agree that the employment relationship cannot be changed in any way, but merely highlights that the employer’s representatives are not authorized to change it.
The Advice Memos are provided as guidance for employers and human resource professionals in a developing area that has drawn considerable attention recently. They distinguish the language in the two handbooks from another at-will clause that was recently found by an NLRB Administrative Law Judge to be unlawfully broad. That case was settled before Board review.
Because Board law in this area remains unsettled, the Acting General Counsel is asking all Regional Offices to submit cases involving employer handbook at-will provisions to the Division of Advice for further analysis and coordination.
Wednesday, October 31, 2012
JAPANESE COMPANY AGREES TO PAY $17.7 MILLION DOLLARS TO SETTLE PRICE FIXING & OBSTRUCTION OF JUSTICE CHARGES
FROM: U.S. DEPARTMENT OF JUSTICE
Tuesday, October 30, 2012
Japanese Automobile Parts Manufacturer Agrees to Plead Guilty to Price Fixing and Obstruction of Justice
Company Agrees to Pay $17.7 Million Criminal Fine
WASHINGTON — Nagoya, Japan-based Tokai Rika Co. Ltd., has agreed to plead guilty and to pay a $17.7 million criminal fine for its role in a conspiracy to fix prices of heater control panels (HCPs) installed in cars sold in the United States and elsewhere, the Department of Justice announced today. Tokai Rika has also agreed to plead guilty to a charge of obstruction of justice related to the investigation of the antitrust violation.
According to a two-count felony charge filed today in U.S. District Court for the Eastern District of Michigan in Detroit, Tokai Rika engaged in a conspiracy, by agreeing during meetings and conversations, to rig bids for, and to fix, stabilize and maintain the prices of HCPs sold to Toyota in the United States and elsewhere, on a model-by-model basis. According to the court document, Tokai Rika and its co-conspirators carried out the conspiracy from at least as early as September 2003 until at least February 2010.
Tokai Rika manufactures and sells a variety of automotive parts, including HCPs. HCPs are located in the center console of an automobile and control the temperature of the interior environment of a vehicle.
"The conspirators used code names and chose meeting places and times to avoid detection," said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program. "They knew their actions would harm American consumers, and attempted to cover it up when caught. The division will continue to hold accountable companies who engage in anticompetitive conduct and who obstruct law enforcement."
According to the charge, in or about February 2010, after the company and its executives and employees became aware that the FBI had executed a search warrant on Tokai Rika’s U.S. subsidiary, a company executive directed employees to delete electronic data and destroy paper documents likely to contain evidence of antitrust crimes in the United States and elsewhere. The department said that as a result, electronic data was deleted and paper documents were destroyed, and some of the deleted electronic data and destroyed paper documents were non-recoverable.
"Those who engage in price fixing and obstruction of legal process will face severe consequences for their illegal acts," said Robert D. Foley III, Special Agent in Charge of the FBI’s Detroit Division. "The FBI is committed to stopping such criminal activity."
As part of the plea agreement, which will be subject to court approval, Tokai Rika has agreed to cooperate with the department’s ongoing investigation.
Including Tokai Rika, nine companies and 11 executives have pleaded guilty or agreed to plead guilty in the department’s ongoing investigation into price fixing and bid rigging in the auto parts industry. Furukawa Electric Co. Ltd., DENSO Corp., Yazaki Corp., G.S. Electech Inc., Fujikura Ltd., Autoliv Inc. and TRW Deutschland Holding GmbH pleaded guilty and were sentenced to pay a total of more than $790 million in criminal fines. Nippon Seiki Co. Ltd., has agreed to plead guilty and awaits arraignment and sentencing. Additionally, Junichi Funo, Hirotsugu Nagata, Tetsuya Ukai, Tsuneaki Hanamura, Ryoki Kawai, Shigeru Ogawa, Hisamitsu Takada, Norihiro Imai, Kazuhiko Kashimoto, Toshio Sudo and Makoto Hattori have pleaded guilty and been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each.
Tokai Rika is charged with price fixing in violation of the Sherman Act, which carries a maximum penalty of a $100 million criminal fine for corporations. The maximum fine for the company may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine. The maximum fine for a company found guilty of obstruction of justice is $500,000.
Today’s prosecution arose from an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s National Criminal Enforcement Section and the FBI’s Detroit Field Office with the assistance of the FBI headquarters’ International Corruption Unit.
Tuesday, October 30, 2012
Japanese Automobile Parts Manufacturer Agrees to Plead Guilty to Price Fixing and Obstruction of Justice
Company Agrees to Pay $17.7 Million Criminal Fine
WASHINGTON — Nagoya, Japan-based Tokai Rika Co. Ltd., has agreed to plead guilty and to pay a $17.7 million criminal fine for its role in a conspiracy to fix prices of heater control panels (HCPs) installed in cars sold in the United States and elsewhere, the Department of Justice announced today. Tokai Rika has also agreed to plead guilty to a charge of obstruction of justice related to the investigation of the antitrust violation.
According to a two-count felony charge filed today in U.S. District Court for the Eastern District of Michigan in Detroit, Tokai Rika engaged in a conspiracy, by agreeing during meetings and conversations, to rig bids for, and to fix, stabilize and maintain the prices of HCPs sold to Toyota in the United States and elsewhere, on a model-by-model basis. According to the court document, Tokai Rika and its co-conspirators carried out the conspiracy from at least as early as September 2003 until at least February 2010.
Tokai Rika manufactures and sells a variety of automotive parts, including HCPs. HCPs are located in the center console of an automobile and control the temperature of the interior environment of a vehicle.
"The conspirators used code names and chose meeting places and times to avoid detection," said Scott D. Hammond, Deputy Assistant Attorney General of the Antitrust Division’s criminal enforcement program. "They knew their actions would harm American consumers, and attempted to cover it up when caught. The division will continue to hold accountable companies who engage in anticompetitive conduct and who obstruct law enforcement."
According to the charge, in or about February 2010, after the company and its executives and employees became aware that the FBI had executed a search warrant on Tokai Rika’s U.S. subsidiary, a company executive directed employees to delete electronic data and destroy paper documents likely to contain evidence of antitrust crimes in the United States and elsewhere. The department said that as a result, electronic data was deleted and paper documents were destroyed, and some of the deleted electronic data and destroyed paper documents were non-recoverable.
"Those who engage in price fixing and obstruction of legal process will face severe consequences for their illegal acts," said Robert D. Foley III, Special Agent in Charge of the FBI’s Detroit Division. "The FBI is committed to stopping such criminal activity."
As part of the plea agreement, which will be subject to court approval, Tokai Rika has agreed to cooperate with the department’s ongoing investigation.
Including Tokai Rika, nine companies and 11 executives have pleaded guilty or agreed to plead guilty in the department’s ongoing investigation into price fixing and bid rigging in the auto parts industry. Furukawa Electric Co. Ltd., DENSO Corp., Yazaki Corp., G.S. Electech Inc., Fujikura Ltd., Autoliv Inc. and TRW Deutschland Holding GmbH pleaded guilty and were sentenced to pay a total of more than $790 million in criminal fines. Nippon Seiki Co. Ltd., has agreed to plead guilty and awaits arraignment and sentencing. Additionally, Junichi Funo, Hirotsugu Nagata, Tetsuya Ukai, Tsuneaki Hanamura, Ryoki Kawai, Shigeru Ogawa, Hisamitsu Takada, Norihiro Imai, Kazuhiko Kashimoto, Toshio Sudo and Makoto Hattori have pleaded guilty and been sentenced to pay criminal fines and to serve jail sentences ranging from a year and a day to two years each.
Tokai Rika is charged with price fixing in violation of the Sherman Act, which carries a maximum penalty of a $100 million criminal fine for corporations. The maximum fine for the company may be increased to twice the gain derived from the crime or twice the loss suffered by the victims of the crime, if either of those amounts is greater than the statutory maximum fine. The maximum fine for a company found guilty of obstruction of justice is $500,000.
Today’s prosecution arose from an ongoing federal antitrust investigation into price fixing, bid rigging and other anticompetitive conduct in the automotive parts industry, which is being conducted by the Antitrust Division’s National Criminal Enforcement Section and the FBI’s Detroit Field Office with the assistance of the FBI headquarters’ International Corruption Unit.
Monday, October 29, 2012
JUSTICE SETTLES ADA ACCESSIBILITY VIOLATIONS WITH RESTAURANT
FROM: U.S. DEPARTMENT OF JUSTICE
Wednesday, October 24, 2012
Justice Department Reaches Settlement with Maryland Restaurant Over Accessibility Violations
The Justice Department announced today that it reached a settlement with Mrs. K’s Tollhouse Restaurant of Silver Spring, Md., to remedy alleged violations of the Americans with Disabilities Act (ADA). The agreement resolves allegations that the restaurant failed to remove architectural barriers that made parts of it inaccessible to people with disabilities, including those who use wheelchairs.
Under the settlement agreement, Mrs. K’s will make the interior of the restaurant, the exterior routes and the parking lots accessible to people with disabilities. Mrs. K’s will also install a new fully accessible restroom and retrofit an existing one.
"People with disabilities have the right to go to restaurants just like everyone else," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "The department is committed to ensuring that this civil right is upheld for all people with disabilities."
The ADA requires public accommodations, including restaurants, to provide people with disabilities, including those who use wheelchairs, full and equal enjoyment of the public accommodation’s goods, services and facilities.
The Justice Department provides a webpage specifically dedicated to information about the ADA at www.ada.gov . Those interested in finding out more about these settlements or the obligations of public accommodations under the ADA may call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TTY), or access its ADA website at www.ada.gov . ADA complaints may be filed by email to ada.complaint@usdoj.gov .
Wednesday, October 24, 2012
Justice Department Reaches Settlement with Maryland Restaurant Over Accessibility Violations
The Justice Department announced today that it reached a settlement with Mrs. K’s Tollhouse Restaurant of Silver Spring, Md., to remedy alleged violations of the Americans with Disabilities Act (ADA). The agreement resolves allegations that the restaurant failed to remove architectural barriers that made parts of it inaccessible to people with disabilities, including those who use wheelchairs.
Under the settlement agreement, Mrs. K’s will make the interior of the restaurant, the exterior routes and the parking lots accessible to people with disabilities. Mrs. K’s will also install a new fully accessible restroom and retrofit an existing one.
"People with disabilities have the right to go to restaurants just like everyone else," said Thomas E. Perez, Assistant Attorney General for the Civil Rights Division. "The department is committed to ensuring that this civil right is upheld for all people with disabilities."
The ADA requires public accommodations, including restaurants, to provide people with disabilities, including those who use wheelchairs, full and equal enjoyment of the public accommodation’s goods, services and facilities.
The Justice Department provides a webpage specifically dedicated to information about the ADA at www.ada.gov . Those interested in finding out more about these settlements or the obligations of public accommodations under the ADA may call the Justice Department’s toll-free ADA information line at 800-514-0301 or 800-514-0383 (TTY), or access its ADA website at www.ada.gov . ADA complaints may be filed by email to ada.complaint@usdoj.gov .
Sunday, October 28, 2012
MAN AND COMPANIES CHARGED WITH MAKING FALSE CLAIMS WHILE SOLICITING BUSINESS
FROM: U.S. COMMODITY FUTURES TRADING COMMISSION
Kaup and his companies, Lunden Forex Partners, LP, Lunden Forex Management, LLC, Black Horse Funds, LLC, Black Horse Management, LLC, and Black Horse Partners, LP, defrauded investors out of almost $1.4 million
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that it filed and simultaneously settled charges against David Kaup of San Gabriel, Calif., and his California-based companies, Lunden Forex Partners, LP, Lunden Forex Management, LLC (Lunden Entities), Black Horse Funds, LLC, Black Horse Management, LLC, and Black Horse Partners, LP (Black Horse Entities). The CFTC charged that they fraudulently solicited individuals with false claims of a profitable trading history for the purpose of trading leveraged or margined off-exchange foreign currency (forex) contracts, misappropriated customer funds, and issued false statements to conceal trading losses and the fraud.
The CFTC order, filed on October 22, 2012, requires Kaup, the Lunden Entities, and the Black Horse Entities jointly and severally to pay a $500,000 civil monetary penalty and restitution of $1,396,316. The order permanently prohibits Kaup, the Lunden Entities, and the Black Horse Entities from engaging in certain commodity-related activities, including trading, and from registering or seeking exemption from registration with the CFTC. The order also permanently prohibits the respondents from further violations of anti-fraud provisions of the Commodity Exchange Act, as charged.
Specifically, the order finds that from about August 2008 through October 2009, Kaup, first through the Lunden Entities and then through the Black Horse Entities, all companies he controlled, fraudulently solicited and accepted at least $1.7 million from at least 24 customers to trade forex contracts. In soliciting potential customers, Kaup falsely claimed that he had a trading track record of earning monthly profits of from 5 percent to 30 percent, provided fraudulent documents to potential customers showing a successful forex trading history, and guaranteed customers monthly profits of from 5 to 10 percent, the order finds. Moreover, the respondents misappropriated customers’ funds to make payments to other customers and to pay Kaup’s personal expenses, the order finds.
Kaup, through the Lunden Entities and the Black Horse Entities, concealed their trading losses and misappropriation of customer funds by assuring customers that their investments were profitable and by issuing false account statements, the order finds. As a result of this scheme, investors were defrauded in the amount of almost $1.4 million.
The CFTC appreciates the assistance of the U.S. Attorney’s Office for the Central District of California, the Federal Bureau of Investigation, the Pennsylvania Securities Commission, and the Securities and Exchange Commission.
CFTC Division of Enforcement staff members responsible for this case are Mark A. Picard, Philip Rix, Steven I. Ringer, Lenel Hickson, Stephen J. Obie and Vincent A. McGonagle.
Kaup and his companies, Lunden Forex Partners, LP, Lunden Forex Management, LLC, Black Horse Funds, LLC, Black Horse Management, LLC, and Black Horse Partners, LP, defrauded investors out of almost $1.4 million
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced that it filed and simultaneously settled charges against David Kaup of San Gabriel, Calif., and his California-based companies, Lunden Forex Partners, LP, Lunden Forex Management, LLC (Lunden Entities), Black Horse Funds, LLC, Black Horse Management, LLC, and Black Horse Partners, LP (Black Horse Entities). The CFTC charged that they fraudulently solicited individuals with false claims of a profitable trading history for the purpose of trading leveraged or margined off-exchange foreign currency (forex) contracts, misappropriated customer funds, and issued false statements to conceal trading losses and the fraud.
The CFTC order, filed on October 22, 2012, requires Kaup, the Lunden Entities, and the Black Horse Entities jointly and severally to pay a $500,000 civil monetary penalty and restitution of $1,396,316. The order permanently prohibits Kaup, the Lunden Entities, and the Black Horse Entities from engaging in certain commodity-related activities, including trading, and from registering or seeking exemption from registration with the CFTC. The order also permanently prohibits the respondents from further violations of anti-fraud provisions of the Commodity Exchange Act, as charged.
Specifically, the order finds that from about August 2008 through October 2009, Kaup, first through the Lunden Entities and then through the Black Horse Entities, all companies he controlled, fraudulently solicited and accepted at least $1.7 million from at least 24 customers to trade forex contracts. In soliciting potential customers, Kaup falsely claimed that he had a trading track record of earning monthly profits of from 5 percent to 30 percent, provided fraudulent documents to potential customers showing a successful forex trading history, and guaranteed customers monthly profits of from 5 to 10 percent, the order finds. Moreover, the respondents misappropriated customers’ funds to make payments to other customers and to pay Kaup’s personal expenses, the order finds.
Kaup, through the Lunden Entities and the Black Horse Entities, concealed their trading losses and misappropriation of customer funds by assuring customers that their investments were profitable and by issuing false account statements, the order finds. As a result of this scheme, investors were defrauded in the amount of almost $1.4 million.
The CFTC appreciates the assistance of the U.S. Attorney’s Office for the Central District of California, the Federal Bureau of Investigation, the Pennsylvania Securities Commission, and the Securities and Exchange Commission.
CFTC Division of Enforcement staff members responsible for this case are Mark A. Picard, Philip Rix, Steven I. Ringer, Lenel Hickson, Stephen J. Obie and Vincent A. McGonagle.
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