Sodexho pays NY AG $20 million to settle state False Claims Act qui tam

by Ben Vernia | July 28th, 2010

New York Attorney General Andrew Cuomo announced on July 21 a settlement in a whistleblower suit brought against Sodexho by two former Sodexho managers in federal court in Massachusetts. According to the NY AG’s press release:

An Attorney General investigation found that the company promised to provide goods at cost but failed to acknowledge rebates from suppliers, resulting in illegal overcharges to the schools. The investigation was sparked by former employees of Sodexo under the New York False Claims Act, which allows whistleblowers to come forward to disclose wrongdoing without fear of retribution. The settlement was unsealed in Federal Court in Massachusetts and is the largest monetary settlement under the Act that does not involve Medicaid funds.

The 21 schools and the SUNY system contracted with Sodexo to provide food services, vending and facilities services. An investigation by Attorney General Cuomo’s Office determined that from September 1, 2004 through August 31, 2009, Sodexo received significant rebates from its suppliers without acknowledging or passing the savings on to these schools — in violation of the contracts, as well as state and federal laws.

The whistleblowers’ share of the settlement is $3.6 million (an 18% share).

No Responses to “Sodexho pays NY AG $20 million to settle state False Claims Act qui tam”

  1. Sodexho should be excluded debarred from all government– local, state and federal. They do this everywhere. Tip of proverbial iceberg

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