"Men must turn square corners when they deal with the Government." So began the Court of Claims decision entitled Lodge Construction, Inc. v. United States, Nos. 13-499 and 13-800 (January 1, 2022), which the court described as "a cautionary tale to government contractors."

The court went on to state:

For those who seek to recoup sums of money from the Federal Government, and thus burden taxpayers, rudimentary recordkeeping and approximated claims are likely insufficient. When job cost data and recordkeeping are inaccurate, the claim will inevitably contain errors and the line between negligence and reckless disregard for the truth becomes vanishingly thin. Cross it, and the government contractor's claim becomes fraudulent as a matter of law, a designation that carries financial, practical, and stigmatic consequences.

In this case, the court noted that while some elements of the contractor's claims may have reflected nothing more than "slapdash formulae," overwhelming evidence established that substantial portions of those claims were patently deceitful.

The Court's Analysis

To support its statements, the court provided a detailed analysis of the shortcomings of the contractor's claims, including (a) a failure to accurately identify the equipment it used and support the valuation of that equipment with proper documentation, (b) a "dubious metric" to measure its inefficiencies and dishonestly inflate its claims, (c) an "artifice" through which it sought to inflate costs of...

Read Full Story: https://www.jdsupra.com/legalnews/court-of-federal-claims-addresses-7452485/