ATK Launch Systems Inc. Settles False Claims Product Substitution Case for Nearly $37 Million

In a Qui Tam False Claims Act suit filed in the U.S. District Court for the District of Utah,  ATK Launch Systems Inc., has agreed to pay the United States $21 million and provide necessary in-kind services worth $15,967,160 in reparation costs for 76,000 malfunctioning para-flares that were sold to the government.  According to the government’s allegation, ATK sold dangerous and defective LUU-2 and LUU-19 illumination flares to the Army and the Air Force under Department of Defense contracts.  The company has agreed to pay a $36,967,160 settlement to the Unites States government to resolve the allegations.

The flares were used during nighttime combat in Iraq and Afghanistan.  The government alleges that the flares provided by ATK were incapable of withstanding a 10-foot drop test as required by specifications.  During the test, flares either exploded or ignited, and ATK was aware of this issue at the time it submitted claims for payment.

The investigation team was led by the Defense Criminal Investigative Service, the Air Force Office of Special Investigation, the Navy Naval Criminal Service, the Army Criminal Investigative Command and auditors from the Defense Contract Audit Agency, and the Defense Contract Management Agency.  Technical support was provided by the Army Research Laboratory in Aberdeen, Md., and several other agencies.

“Our men and women in combat deserve equipment that meets critical safety and performance requirements,” said Stuart F. Delery, Acting Assistant Attorney General for the Civil Division.  The U.S. government plans to diligently pursue entities that put the lives of our soldiers in jeopardy to prevent undue harm from occurring and recover American taxpayer monies.

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