CIV (202) 616-2765 TDD (202) 514-1888

VA CONTRACTOR AGREES TO SETTLE FRAUD SUIT WASHINGTON, D.C. -- Becton Dickinson and Company Inc. of Franklin Lakes, New Jersey, will pay the United States $3.3 million to settle allegations it overcharged the government for in vitro diagnostic substances, reagents, test kits and test sets under a federal supply contract awarded by the Department of Veterans Affairs (VA), the Department of Justice announced today. Assistant Attorney General Frank W. Hunger, in charge of the Civil Division, said the settlement resolves a lawsuit, United States ex rel. Siller v. Becton Dickinson and Company Inc., originally filed in U.S. District Court in Baltimore, Maryland, by David Siller, an employee of Scientific Supply Inc., a former distributor of Becton Dickinson products. Siller filed the suit in 1991 on behalf of the VA under a provision of the False Claims Act that allows private parties to sue companies and individuals who have submitted false claims to the federal government. The United States took over prosecution of the suit in October 1992 and filed a complaint alleging that Becton Dickinson failed to tell the government it granted discounts to commercial customers that were higher than those it disclosed to the VA during contract negotiations. The suit was dismissed by the federal court in Baltimore in 1993, but reinstated by the United States Fourth Circuit Court of Appeals in Richmond, Virginia, in April 1994. The government's complaint alleged that the VA overpaid Becton Dickinson for prepared media such as petri plates, blood culture bottles and related items that are used in VA hospitals for microbiological tests. Becton's contract, which ended December 31, 1991, was for approximately $11 million. VA, through federal supply schedule contracts, acts on behalf of the federal government to establish prices for medical/surgical products from several suppliers at the same time. The VA requires the contractors to disclose accurate, complete and current information about prices and discounts given to commercial customers. The Office of Inspector General for the VA conducted an audit and investigation of Siller's allegations, and concluded that discount information submitted by the contractor when the contracts were negotiated did not accurately reflect the company's pricing practices. VA Inspector General Stephen A. Trodden said the case is the latest in a series of substantial recoveries from contractors who failed to make adequate disclosures to the government. He said the cases should clearly signal that his office and agency management will enforce the government's rights and protect the interests of veteran programs and the American Taxpayer. Siller will receive $561,000 of the settlement proceeds. #### 95-345