U.S. Intervenes in Case Alleging Delivery of Defective Flares on Government Contracts

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June 25, 2007 -- WASHINGTON—The United States has intervened in a whistleblower suit accusing Alliant Techsystems Inc., aka ATK Thiokol Inc. (ATK), of delivering defective illumination flares used in critical search and rescue and combat operations to the U.S. military, including operations in Iraq and Afghanistan, the Justice Department announced today.

The suit was filed in U.S. District Court in Salt Lake City by former ATK employee Kendall Dye, under the qui tam provisions of the False Claims Act. Under those provisions, a private party, known as a whistleblower or relator, can file an action on behalf of the United States and receive a portion of the recovery. Under the False Claims Act, the United States may recover three times the amount of its losses plus civil penalties.

The whistleblower’s complaint, which the United States has now joined, alleges that ATK violated the False Claims Act from as early as May 2000 by deliberately disregarding information that a newly redesigned ignitor for the LUU-2 and LUU-19 series flare was flawed and might not pass a required “10 foot drop test” safety specification. It’s alleged that ATK failed to perform testing to validate the igniter design to the safety specification and subsequently received in excess of $100 million for delivery of its defective LUU series flares to the U.S. Air Force and Army.

In 2005, the U.S. Navy tested a sampling of LUU flares and discovered that the flares could not safely withstand a 10-foot drop without igniting, thereby putting personnel and equipment at risk. The United States has since refused any further deliveries of this defective product.

“Today’s action is meant to ensure that the U.S. Armed Forces can have confidence in the safety of the products they use in their operations.” said Peter D. Keisler, Assistant Attorney General for the Department’s Civil Division.

The investigation of the allegations in the complaint was conducted by the U.S. Attorney’s office in Salt Lake City, the Department’s Civil Division, the Defense Criminal Investigative Service, the Defense Contract Audit Agency, and the Air Force Office of Special Investigations.

Source: DOJ