United Technologies Corp. must pay the U.S. government $473 million – plus interest – for inappropriately manipulating costs in order to win a jet engine contract with the Air Force that dates back to 1986. U.S. District Judge Thomas Rose ruled in favor of the federal government and wrote in his opinion: “The government should not have paid the amounts that the government proved it paid as a direct result of United Technologies’ fraud.”
Because the contract was entered into so long ago, and because interest rates were much higher in the ’80s and ’90s than they are today, interest accrued on the judgment may add hundreds of millions of dollars to Judge Rose’s decision. United says it will appeal. The lawsuit decided by Judge Rose was filed in 1999. The Department of Justice accused United subsidiary Pratt & Whitney in the lawsuit of overcharging the Air Force.
Sources: Reuters and AL.com
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