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Friday, September 23, 2016

Government Intervenes in Suit Against Energy & Process Corporation Alleging Use of Defective Steel Rebar and Quality Control Failures in Nuclear Waste Treatment Facility

The government has intervened in a False Claims Act lawsuit against Energy & Process Corporation (E&P), of Tucker, Georgia, alleging that E&P knowingly failed to perform required quality assurance procedures and supplied defective steel reinforcing bars (rebar) in connection with a contract to construct a Department of Energy (DOE) nuclear waste treatment facility, the Justice Department announced today.

“The Department of Justice is committed to ensuring that construction suppliers who are paid a premium to meet high safety standards actually supply the goods and perform the work for which they are paid,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer, head of the Justice Department’s Civil Division.  “When contractors cut corners, they not only cheat American taxpayers, but they also can put public safety at risk, particularly when their misconduct affects a facility that houses and processes nuclear materials.” 

The lawsuit alleges that although the DOE paid E&P a premium to supply rebar that met stringent regulatory standards for the Mixed Oxide Fuel Fabrication and Reactor Irradiation Services facility in the DOE’s Savannah River site near Aiken, South Carolina, E&P failed to perform most of the necessary quality assurance measures, while falsely certifying that those requirements had been met.  The lawsuit further alleges that one-third of the rebar supplied by E&P and used in the construction was found to be defective.

“To ensure that the nuclear facility would be safe, the government paid E&P a sizable premium for exhaustive quality control procedures,” said U.S. Attorney John Horn of the Northern District of Georgia.  “This lawsuit alleges that E&P intentionally failed to perform the quality control work, and then concealed its failing by providing false certifications to the government.  In intervening in this lawsuit, the U.S. Attorney’s Office seeks to ensure that entities that defraud the government are identified and held responsible.”

The lawsuit was filed by Deborah Cook, a former employee of the prime contractor building the DOE facility, under the qui tam, or whistleblower, provisions of the False Claims Act.  Under the act, private citizens can bring suit on behalf of the government for false claims and share in any recovery.  The act permits the government to intervene in such lawsuits, as it has done in this case.  Defendants found liable under the act are subject to treble damages and penalties. 

This matter was investigated by the Civil Division’s Commercial Litigation Branch, the U.S. Attorney’s Offices of the Northern District of Georgia and the District of South Carolina and the DOE’s Office of Inspector General.

The case is captioned United States ex rel. Cook v. Shaw Areva Mox Services, LLC, et al., Case No. 01:13-cv-4023 (N.D. Ga.). 

The claims asserted against E&P are allegations only and there has been no determination of liability. 

Updated April 27, 2017