Sikorsky pays $3.5 million to settle "defective pricing" claims

by Ben Vernia | April 1st, 2014

On March 31, the U.S. Attorney for the District of Connecticut announced that Connecticut-based Sikorsky Aircraft Corp. had agreed to pay $3.5 million to resolve allegations that the company provided false pricing data in an Army contract for Black Hawk helicopters. According to the press release:

Deirdre M. Daly, United States Attorney for the District of Connecticut, today announced that SIKORSKY AIRCRAFT CORPORATION of Stratford, Conn., which manufactures Black Hawk helicopters and spare parts for the helicopters for the U.S. Military and for friendly nations has entered into a civil settlement in which it will pay $3.5 million to resolve allegations that it violated the False Claims Act arising from the submission of inflated costs in the pricing of spare parts.

The government alleges that from February 7, 2008 through September 8, 2011, Sikorsky failed to disclose accurate, complete and current cost and pricing data to the Army Aviation and Missile Life Cycle Management Command (“AMCOM”). AMCOM is one of the purchasing commands of the Army that is charged with purchasing spare parts for the Black Hawk.

The Truth In Negotiations Act requires that contractors disclose accurate, complete and current cost and pricing data to the government during the negotiation process. When determining the prices to be charged to the government, Sikorsky failed to disclose that it had lower prices for certain parts. As a result, the government paid artificially excessive prices for those parts.

The Black Hawk repair work was principally performed at the Corpus Christi Army Depot in Corpus Christi, Texas.

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The case apparently arose from a DOD investigation, and not from a whistleblower.

Sikorsky paid $2.9 million in 2009 to resolve charges that it had used untested ballistic armor plates in Black Hawk helicopters.

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