LEGAL NEWSLINE

WASHINGTON (Legal Newsline) - Corning has agreed to pay the U.S. $5.65 million to resolve claims for knowingly presenting incorrect information for laboratory research products sold to federal agencies.

The U.S. Justice Department says Corning's Life Sciences Division sold laboratory research products to federal government entities in 2005 through the General Services Administration's (GSA) Multiple Award Schedule (MAS) program.

Corning Incorporated is a New York-based company that creates glass and ceramic components.

During contract negotiations and throughout the contract's administration, Corning knowingly failed to meet its contractual obligations to provide GSA with current, accurate and complete information about commercial sales practices, including discounts offered to other customers, according to the claim.

The settlement resolves allegations that Corning failed to comply with the price reduction clause of its GSA contract by failing to notify GSA of accurate discounts given to commercial customers while also not giving those discounts to government customers.

The U.S. alleges that because it had no knowledge of the discounts, they ultimately paid far more than necessary for Corning products.

"At a time when our political leaders are making tough choices about how to rein in federal spending, government contractors need to understand that they will not get away with overbilling the taxpayer," said U.S. Attorney for the District of Columbia Ronald C. Machen Jr. "Companies that want to take advantage of federal contracts are obligated to deal openly and fairly with their government customers. When contractors fail to meet their obligations, we will hold them accountable and seek to make the taxpayer whole."

This suit filed in the U.S. District Court for the District of Columbia by a former Corning Life Sciences sales representative, Kevin Jones, under the qui tam, or whistleblower provisions, of the False Claims Act. Under the act, private citizens may bring suite for false claims on behalf of the U.S. and share in the recovery, if any.

As a result of this case, Jones will receive $904,000 as his share of the government's recovery.

The MAS program allows the government and other General Services Administration authorized purchasers with a streamlined process for procurement of commonly-used commercial goods to service.
To abide by the contract terms, contractors must agree to disclose commercial pricing policies and practices in order to be awarded a MAS contract and gain access to the broad government marketplace and the ease of administration from selling to hundreds of government purchasers.

"Contractors need to be honest and follow through with their promises to the federal government - or pay the consequences," said Brian D. Miller, Inspector General for the General Services Administration.

This settlement was the result of a coordinated effort by the U.S. Attorney's Office for the District of Columbia; the Department of Justice, Civil Division, Commercial Litigation Branch; and the GSA's Office of Inspector General in investigating the allegations in this case.

The claims settled by this agreement are allegations only.