U.S. files False Claims Act complaint against KBR

WASHINGTON (Legal Newsline) - The U.S. Department of Justice filed a lawsuit on Thursday against a Houston-based engineering, construction and services firm for allegedly submitting false claims in connection with a U.S. Army contract.

The lawsuit against Kellogg, Brown & Root Services Inc. and two Kuwaiti companies, La Nouvelle General Trading & Contracting Co. and First Kuwaiti Trading Co., alleges the companies submitted false claims related to KBR's contract with the Army to provide logistical support in Iraq.

KBR allegedly took kickbacks from La Nouvelle and First Kuwaiti in connection with the contract and oversight of subcontracts awarded to the two Kuwaiti companies. KBR allegedly claimed reimbursement from the U.S. for costs it incurred under the subcontracts that were inflated, excessive or for goods and services that were deficient or not provided.

KBR also allegedly used refrigerated trailers that were used as temporary morgues to transport ice for consumption by troops without first sanitizing the trailers.

Stuart Delery, the assistant attorney general for the department's Civil Division, said the department will make sure that contractors do not engage in corrupt practices at the expense of U.S. troops abroad and U.S. taxpayers at home.

The U.S. Attorney's Office for the Central District of Illinois in Rock Island looked into the actions of KBR and its related companies. The office obtained criminal convictions against several subcontract managers and with the lawsuit the office is seeking civil claims against the companies themselves. The office previously convicted 10 companies and individuals in connection with wartime contracts in Iraq, including three KBR subcontract managers.