(The following press release from the U.S. Justice Department was received
by e-mail and was reformatted. The sender verified the statement.)
FOR IMMEDIATE RELEASE
TUESDAY, JULY 2, 2013
CYTERRA CORPORATION AGREES TO PAY $1.9 MILLION
TO RESOLVE FALSE CLAIMS ACT ALLEGATIONS
WASHINGTON - CyTerra Corporation has agreed to pay the federal government $1.9
million to resolve civil liability arising from its failure to provide the U.
S. Department of the Army with accurate, complete and current cost or pricing
data for its sales of mine detectors, the Justice Department announced today.
CyTerra, headquartered in Waltham, Mass., manufactures equipment, including
portable mine detectors, used by the U. S. military.
"The Department of Justice will hold accountable those who undermine the
integrity of the public contract process in pursuit of financial gain," said
Stuart F. Delery, Acting Assistant Attorney General for the Civil Division of
the U. S. Department of Justice. "Those who wish to do business with the
government are expected to do so fairly, and those who don't will face the
In 2003, the Department of the Army awarded CyTerra a contract for
the production and delivery of AN/PSS-14 hand-held mine detection units. The
contract was modified several times to provide for the production and delivery
of additional mine detection units. The government contended that, in
connection with the negotiations concerning three of these contract
modifications, CyTerra knowingly failed to provide the Army with the most
recent cost or pricing data on the number of labor hours needed to produce a
mine detector. Under the Truth in Negotiations Act, CyTerra was required to
provide cost or pricing data that was "accurate, complete and current." The
government alleged that if the Army had received such information, it would
have negotiated a lower price.
"Contractors who negotiate with the government must be scrupulous
in their dealings with the government," said Carmen M. Ortiz, U.S. Attorney for
the District of Massachusetts. "Government contractors should be on notice
that the requirements of the Truth in Negotiations and False Claims Acts will
The civil settlement resolves a lawsuit pending in federal court in the
District of Massachusetts under the qui tam, or whistleblower, provisions of
the False Claims Act, which allow private citizens to bring civil actions on
behalf of the U. S. and share in any recovery. The action was filed by Kevin
Bartczak and Keith Aldrich, two former CyTerra executives. As part of today's
resolution, Bartczak and Aldrich will share $361,000 from the civil recovery.
The case is being handled by the U.S. Attorney's Office for the District of
Massachusetts and the Civil Division's Commercial Litigation Branch, with
investigative assistance from the Defense Criminal Investigative Service.
"The Defense Criminal Investigative Service (DCIS) is committed to working with
its partner agencies, such as the U.S. Department of Justice, the Naval
Criminal Investigative Service and the Army Criminal Investigation Command, to
ensure the integrity of the Defense Department's procurement process," said
Leigh-Alistair Barzey, Resident Agent-in-Charge of the DCIS Boston Resident
Agency. "This settlement agreement reflects that commitment and is a
successful resolution of this investigation, which could not have occurred
without the direction of the Department of Justice and the assistance of the
Defense Contract Audit Agency's Investigations Support Division."
The civil lawsuit is captioned United States ex rel. Bartczak, et al. v.
CyTerra Corporation., Civil Action No. 06-CA-10550-NMG.
The claims resolved by the settlement are allegations only, and there has been
no determination of liability.
IF YOU HAVE QUESTIONS, PLEASE USE THE CONTACTS IN THE MESSAGE OR CALL THE
OFFICE OF PUBLIC AFFAIRS AT 202-514-2007.
TTY (866) 544-5309
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