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CA Inc. whistleblower who alleged overcharges awarded $10 million

Information technology firm CA Inc. will pay $45 million to resolve allegations that it made false statements and claims in connection with a U.S. government contract, the Justice Department said Friday.

The allegations against New York-based CA were first made in a whistleblower lawsuit.

The suit was filed under the False Claims Act by Dani Shemesh, a former employee of CA Software Israel LTD. 

Shemesh’s share of the settlement is $10.195 million.

Under the False Claims Act, private individuals can sue on behalf of the government and share in any recovery. The FCA also allows the government to intervene and take over the action, as it partly did in this case.

Friday's settlement resolved claims that CA violated the price reduction clause in the contract by not giving government customers additional discounts when commercial discounts improved.

The software licenses and maintenance services in the federal contract were negotiated in 2002 and extended in 2007 and 2009.

CA, Inc. trades on NASDAQ under the symbol CA.

The case was United States ex rel. Shemesh v. CA, Inc., No. 09-1600 (D.D.C.).

The DOJ said the claims resolved by the settlement were allegations only and there wasn't a determination of liability.


Richard L. Cassin is the publisher and editor of the FCPA Blog.