San Diego sues fire-cleanup contractors under California False Claims Act

San Diego’s City Attorney, Michael Aguirre, has sued contractors hired by the city to clear homesites destroyed in the 2007 wildfires. The City’s suit, filed under California’s False Claims Act, alleges that two contractors falsified records and intentionally overbilled the city by more than $2 million. The contractors named in the suit are A.J. Diani Construction Co. of Santa Maria, California and Granite Construction Co. of Watsonville, California. The suit was filed after an investigation by the San Diego Union Tribune but prior to the results of a city audit expected to be complete by early November.

The City Attorney’s investigation looked at work plans, contractor invoices, logs recording debris hauled, weight receipts generated by the dump, and other government records. The suit claims the contractors violated the California False Claims Act by hiking up the cost of materials and misreporting the amounts and types of debris removed. For example, Granite is alleged to have billed the city $32 per foot for the installation of fiber rolls to control erosion, when the amount is far in excess of the contractor’s estimate to the city and is more than five times the amount the city’s experts describe as reasonable.

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