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Military contractor settles whistle-blower charges of improper testing


A Florida firm has agreed to a settlement with a value of up to $4.4 million to resolve False Claims Act charges filed by whistle-blowers that it improperly tested equipment and electronic parts that are used by the military and NASA, the U.S. Department of Justice said Monday.

Two whistle-blowers, who are former employees of St. Petersburg, Fla.-based Conax Florida Corp., will receive a total of $810,500 as a result of the settlement, the Justice Department said.

The department said Conax and related companies improperly tested inertia reels and nonconforming voltage references. Inertia reels are part of a system designed to secure aircrew members in the event of a crash. On impact, they lock in place harnesses worn by aircrew members, preventing injury. Voltage references are electronic parts used in water-activated parachute releases. Both devices are used by the U.S. military and NASA, according to the Justice Department.

The government charged the inertia reels were not tested in accordance with contractual requirement and that Conax used nonconforming voltage references. It said the voltage reference is an integral part of the water-activated parachute release, designed to protect unconscious or injured aircrew members who parachute into salt water. They are intended to automatically separate parachutes from aircrew members when they are physically unable to do so. If parachutes are not released, they may fill with water and drag crew members underwater.

Under terms of the settlement, Conax paid $2 million to the government. It also reached an agreement with the U.S. Defense Logistics Agency to provide the government with 4,969 new electronic parts for use with parachute releases, which are worth up to $2.4 million.


The whistle-blowers in the case, who had filed suit under the whistle-blower provision of the False Claims Act in U.S. District Court in Cincinnati, are Mark Hansson and Steven Schummer.

Stuart F. Delery, assistant attorney general for the Justice Department's civil division, said in a statement, “Our military deserves equipment that is properly built and tested and meets specifications designed to ensure their safety.”

Conax's parent company, Arlington, Va.-based Cobham P.L.C., said in a statement: “During the course of the government's investigation — which lasted more than four years — evidence was provided which resulted in the government declining to bring criminal charges.

“The government pursued two of the many allegations in the complaint, with the company choosing to settle the civil false claims allegations for a minimal sum relative to the value of the contracts at issue.

“Throughout the course of the investigation, the company maintained that its products posed no safety concerns, a position supported by the government's technical experts after thorough testing.”