Oce False Claims Agreement With U.S. Returned to Trial Court

Oce NV’s $1.2 million settlement with the U.S. over a whistle-blower lawsuit will go back to a trial court after an appeals panel said the judge didn’t review whether the deal was adequate or fair.

The federal court of appeals Washington today reversed a lower court ruling that affirmed the 2009 accord and also restored whistle-blowing plaintiff Stephanie Schweizer’s claim that the company retaliated against her.

Schweizer, who worked as a contract manager for printer and copier maker Oce, now a unit of Canon Inc. (7751), objected to the terms of the settlement, which set aside 19 percent for her and a later-added co-plaintiff.

“The government may not settle a case when the relator objects unless the court approves the settlement,” the three- judge panel said in a unanimous 25-page ruling.

Canon completed its two-year $1 billion takeover of Oce last year. It is the Tokyo-based company’s biggest purchase. Oce’s headquarters is in Venlo, Netherlands.

Canon didn’t immediately respond to an e-mail seeking comment on the ruling.

In her 2006 lawsuit, Schweizer claimed Oce wasn’t honoring an agreement to give the U.S. government the same pricing discounts offered to some private-sector customers, according to the court of appeals ruling.

She also alleged Oce was in breach of a contractual promise to sell the U.S. only equipment made in the U.S. or in countries covered by the federal Trade Agreements Act.

Schweizer then opposed the accord, arguing it understated the extent of her employer’s violations, the court said.

The case U.S. ex rel. Schweizer v. Oce NV, 11-7030, U.S. Court of Appeals for the District of Columbia Circuit.

To contact the reporter on this story: Andrew Harris in Chicago at aharris16@bloomberg.net

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

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