Government Contracts Monitor

Short Takes: You Must Satisfy Your Contractual Obligations!

August 18, 2014

By: Lindsay Simmons

The Department of Justice recently announced that McKesson Corporation (McKesson) has agreed to pay $18 million to resolve a False Claims Act case.  This settlement resolves allegations of wrongdoing first raised by McKesson’s former finance director under the whistleblower provision of the False Claims Act. 

McKesson held a contract with the Centers for Disease Control and Prevention (CDC).  Under this contract McKesson was to deliver vaccines to the CDC and to maintain those vaccines at proper temperatures during all of the shipping and handling operations to be performed by McKesson. According to the government, McKesson failed to set its temperature monitors to the proper range and, as a result, it “knowingly submitted false claims to the CDC for shipping and handling services that did not satisfy its contractual obligations.” 

This is the latest in a long series of recoveries under the False Claims Act – recoveries that total more than $20.2 billion over the last five years. Justice Department Press Release - August 8, 2014

Lindsay Simmons is responsible for the contents of this Short Take.