Earlier today we shared a press release from US Immigration and Customs Enforcement regarding a civil settlement by LBT, Inc of $2.1 million for the resolution of claims brought by an employee of LBT under the qui tam provisions of the False Claims Act and overseen by the U.S. District Court for the Southern District of Ohio.
I have asked LBT to provide a statement to clarify their position. Having read it, it also serves to focus on the heart of the matter at hand and provides a clearer picture of the settlement.
“11/30/2023
LBT fully cooperated with the government’s investigation of this matter and is glad to have it resolved. LBT has always been and remains committed to providing the best support for America’s warfighter. This settlement addressed bags sold by LBT in 2015 and 2016 that did not comply with the Berry Amendment. The bags supplied by LBT complied, however, with the design specifications established by the military. None of the bags malfunctioned and, by their very nature, could not and did not present any safety concerns for the warfighter. In late April 2017, LBT implemented meaningful changes to its compliance program. Since that time, no concerns have been raised during any of the regular inspections of LBT performed by quality assurance personnel from DLA, military squadron representatives, or a prime contractor. LBT has not been debarred and continues to provide items in support of America’s troops and first responders.”
This is the conclusion of an investigation we discussed back in April of 2017. The ICE press release to allude to several other issues which sound more severe than what we see here. However, considering the length of the investigation and the limited scope of the settlement, the other issues brought up don’t weren’t included.
As LBT states, the issue is now resolved and they implemented procedures several years to prevent this from happening again. They remain in business so there must be something to those claims. Many, me included, are eager to see how LBT will conduct themselves in the market place now that this has concluded.
Was ICE (or HSI) investigating it because the bags were perceived to be counterfeit and/or not Berry Compliant?
Retired HSI here. This most likely not due to an accusation of counterfeit products. Qui tam cases are generally the result of an employee of other person with inside knowledge making a complaint against the company. As a result of their complaint they are awarded a portion of the judgement. These suits are also used a a business weapon against competition. If you are wondering how/why HSI was involved, it’s most likely as a result of the importation of the goods in question.
Please disregard my prior question on this post! I missed the earlier story somehow. My bad.