U.S. to prosecute Martin Marietta on fraud charges

May 20, 1994|By Bloomberg Business News

WASHINGTON -- The Justice Department said yesterday that it has taken over the prosecution of a lawsuit alleging that Martin Marietta Corp. double-billed the government for millions of dollars under a Navy weapons contract.

The suit was original filed by a former Martin Marietta employee under the whistle-blower provisions of the False Claims Act, which allow a person with knowledge of fraud against the federal government to sue on behalf of the United States. The government itself can then investigate the claims and take over the lawsuit if it finds that the claims have merit.

In its own complaint, filed in federal district court in Baltimore, the government alleged that Bethesda-based Martin Marietta charged "millions of dollars' " worth of work to a research and development overhead account that should have been charged fTC to an existing Navy contract for the development of a supersonic low-altitude target missile.

"By double-billing for various costs through its overhead pools, Martin Marietta knowingly submitted hundreds, if not thousands, false claims for payment to the government," the department said.

A Martin Marietta spokesman said the bills were for work the company performed to enhance the Navy contract, among others, and that the billing had been approved in advance by the government.

"We will vigorously defend ourselves in this case," said spokesman Charles Manor.

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