Virginia technology company consents to enormous settlement in False Claims Act suit

NetApp, based in McLean, Virginia, has settled a whistleblower suit in which the Justice Department accused the company of overcharging the federal government. The company, which manufactures high-end equipment for data management and storage, was charged in the suit of violating the False Claims Act by billing the General Services Administration with higher prices than those accorded to NetApp’s commercial clients. Under the company’s contract with the GSA, it was required to offer the government the lowest prices given to other customers. From 1997 to 2005, it was alleged that NetApp provided the GSA with inaccurate and incomplete information about the company’s pricing practices. The GSA became aware of the misconduct when a NetApp manager of procurement operations, Igor Kapuscinski, filed a whistleblower lawsuit in federal court in the District of Columbia. Mr. Kapuscinski is entitled to a portion of the settlement under the Qui Tam provisions of the federal False Claims Act. In addition, NetApp will pay Mr. Kapuscinski a sizable amount for legal fees and expenses.

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