Department of Justice Seal

FOR IMMEDIATE RELEASE

CIV

WEDNESDAY, MARCH 3, 1999

(202) 616-2765

WWW.USDOJ.GOV TDD

(202) 514-1888


JUSTICE DEPARTMENT SUES UNITED TECHNOLOGIES DIVISION

FOR OVERCHARGES ON JET ENGINE CONTRACT


WASHINGTON, D.C. -- The Department of Justice today sued Connecticut-based United Technologies Corporation, Pratt & Whitney Division, to recover approximately $75 million that it overcharged the Air Force for jet engines.

Acting Assistant Attorney General David W. Ogden of the Civil Division and United States Attorney Sharon J. Zealey of Cincinnati, Ohio, said that the complaint was filed in U.S. District Court in Dayton, Ohio.

Between 1985 and 1991, the Air Force purchased F100-220 jet engines, manufactured by Pratt and Whitney, for its F-15 and F-16 high performance fighter jet aircraft. According to the complaint, Pratt & Whitney violated the civil False Claims Act by knowingly inflating its estimated costs for parts it purchased from sole-source vendors and withholding supporting data that would have revealed the overstatements. The complaint alleges that Pratt & Whitney also falsely certified to the Air Force that its estimated costs for the purchased parts and assemblies were based on accurate, complete and current cost data.

The Air Force relied on Pratt & Whitney's false representations, accepted the inflated engine prices, and was allegedly overcharged by more than $75 million during the performance of the contract.

The alleged overcharges were part of the negotiation of the Alternate Fighter Engine contract in 1984 at Wright-Patterson Air Force Base near Dayton. In that contract, the Air Force sought to obtain proposals from and negotiate engine purchases with Pratt & Whitney, formerly its sole-source supplier, and the General Electric Company, an anticipated source for high-performance jet engines. Ultimately, the Air Force split engine orders totaling about $7 billion between Pratt & Whitney and General Electric.

The case will be handled jointly by the Civil Division and the United States's Attorney's Office.

The complaint seeks damages and civil penalties under the False Claims Act and other common law remedies.

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