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Honeywell Accuses U.S. of Misconduct in False Claims Suit Over Body Armor

Honeywell International Inc. (HON) accused the U.S. Justice Department of withholding “critical” evidence in a false claims lawsuit alleging the company used defective materials in body armor the government bought.

Honeywell, alleging misconduct, asked a federal judge in Washington yesterday to sanction department lawyers for sponsoring “inaccurate and misleading” testimony contradicted by documents that the government delayed turning over to the company.

“We believe the Department of Justice has violated federal discovery rules by failing to properly search for, produce and preserve evidence that would exonerate Honeywell,” Peter Dalpe, a spokesman for Honeywell, said in an e-mail. “We continue to believe there is no factual or legal basis for the Justice Department’s claims, and we will continue to vigorously defend ourselves.”

Charles Miller, a Justice Department spokesman, declined to comment.

The U.S. sued the Morris Township, New Jersey-based company in 1998, claiming it “possessed a wealth of scientific data” showing that the so-called Zylon Shield material used in body armor degraded “quickly over time,” especially in hot and humid conditions. Honeywell failed to tell the government or the vests’ manufacturer about the problem, the U.S. said.

Law Enforcement Agencies

The vests were bought by federal, state and local law enforcement agencies, the Justice Department said in its complaint. The U.S. paid more than $20 million for the vests, according to court papers.

Earlier this month, U.S. District Judge Richard Roberts rejected Honeywell’s request to dismiss the case.

The company’s filing yesterday alleges Justice Department lawyers misled Honeywell by claiming on at least four occasions that the “vast majority” of documents requested by Honeywell had been turned over to the defense.

Honeywell claims that from October 2010 through April, more than 120,000 additional documents were found by the government. The documents contain material that undermines the Justice Department’s fraud accusations, Honeywell claims.

“These documents show Honeywell informing the United States of ‘environmental effects’ in high heat and humidity testing of Z Shield, asking for guidance from the government on how to test the product, and repeatedly offering to share test data and technical expertise with government researchers,” Honeywell said in the motion.

Armor Holdings Inc., which manufactured the Zylon vests, said in 2005 it would cease production. BAE Systems Plc, Europe’s largest arms company, bought Armor Holdings in 2007 for $4.53 billion. In October 2008, Armor Holdings agreed to pay $30 million to resolve allegations involving the vests.

Safety concerns about the vests first arose in 2003.

The case is U.S. v. Honeywell International Inc., 08-cv- 00961, U.S. District Court, District of Columbia (Washington).

To contact the reporter on this story: Tom Schoenberg in Washington at tschoenberg@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net.

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