Whistleblower Lawsuit Exposing Fraud at Largest U.S. Nuclear Waste Treatment Facility Settles for More Than $57 Million

September 24, 2020

by M&S Staff

To learn more about the case and to read our complaint, please visit the settlement website.

SEPTEMBER 22, 2020 (WASHINGTON, D.C.) — The United States Department of Justice announced today a more than $57 million settlement to resolve fraud allegations at the Hanford nuclear reservation — the nation’s most contaminated nuclear site and now one of the world’s largest and most hazardous environmental remediation projects. The lawsuit was filed under the False Claims Act by a group of four whistleblowers who worked at the Hanford Waste Treatment & Immobilization Plant Project (WTP) in Washington State.

The whistleblower lawsuit, originally filed under seal in 2017 in the United States District Court for the Eastern District of Washington, alleged a variety of fraud schemes by prime contractor, Bechtel Corporation; and subcontractor, AECOM Energy & Construction, Inc. (AECI).  The whistleblowers — who all worked at the WTP and personally witnessed the fraud schemes they reported — are represented by Washington, DC-based firm Mehri & Skalet, PLLC (M&S), and Seattle, WA-based firm Smith & Lowney, PLLC (S&L).

In addition to the $57 million payment, the settlement agreement includes a robust corporate monitoring provision, designed to prevent these schemes from continuing into the future. “Our whistleblower clients are the heroes in this story. Unfortunately, the Hanford project has often been victimized by unscrupulous contractors who chose to cheat the taxpayers for their own personal gain. In each case, courageous whistleblowers stepped forward, spoke out, and returned millions of our taxpayer funds to the federal government. We hope that the strong corporate monitoring agreement in this case will prevent Hanford contractors from treating the site as a personal piggy bank, while shirking their responsibilities to timely and efficiently address the dangerous and challenging work the WTP presents,” said Richard Condit, Co-Chair of M&S’s Whistleblower Rights practice.

The whistleblower complaint alleged that the contractors egregiously defrauded the taxpayers when they sought reimbursements from the government by: falsifying time-keeping records; intentionally hiring more employees than needed; directing employees to bill for unnecessary overtime; and knowingly billing time to improper work codes, among other misconduct. Moreover, the complaint alleged that, by cutting corners, the contractors not only jeopardized the health and safety of their employees and the public at large, but they have threatened the viability of the entire WTP. The United States joined the whistleblowers’ time-fraud allegations, and the parties agreed to resolve all of the whistleblowers’ claims for $57.75 million. Under the False Claims Act, when the government joins a successful whistleblower lawsuit, the whistleblower is generally entitled to a reward of between 15% and 25% of the recovery. For their efforts, the four whistleblowers in this case have been awarded a near-maximum 23.8% reward.

In addition to their fraud allegations, each of the whistleblowers sued their respective contractor employers for whistleblower retaliation. Those four claims have also been resolved, but the terms of those settlement agreements will not be disclosed. S&L attorney, Meredith Crafton, commented: “These four clients have shown remarkable perseverance by doing what they knew was right – even in the face of a years-long battle against multi-billion-dollar adversaries. It is never easy to speak out; and our clients risked their careers to speak out for safety and accountability. It was always important to make clear that we were representing four individuals whose lives were upended, as well as the United States taxpayers. It has been an honor to achieve this comprehensive result.”

The four whistleblowers provided a unique mix of talents as well as perspectives on the work being performed at WTP. Their expertise ranged from skilled craftsmen to planners and schedulers to turnover/transition specialists, and material coordinators. They shared a commitment to seeing that WTP succeeds, as well as a commitment to protecting the taxpayer. They also shared the individual and collective courage needed to step up and challenge wrongdoing. They are the reason taxpayer monies are being returned to the government and a new monitoring and compliance initiative is being launched.

S&L and M&S also want to recognize the outstanding work of the local Department of Energy Office of Inspector General’s team, as well as the U.S Attorney’s Office for the Eastern District of Washington. The results achieved would not have been possible without the Government Team’s tenacity, skill, and professionalism.

Whistleblowers working on any of the Hanford projects need to know that they are protected for raising concerns about fraud, mismanagement, contract violations, worker safety, and environmental protection issues. For more information about this case, and to learn more about the protections and rewards available to whistleblowers under the False Claims Act, check out www.FightFraudWhistleblowers.com.

The lawsuit is captioned: United States ex rel. Relator 1, Relator 2, Relator 3, and Relator 4 v. Bechtel Corporation, et al., Case No. 4:17-CV-05074-SMJ (E.D. Wash.)