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Monday, August 18, 2025

“False” Sense of Security: DOJ Announces False Claims Act Settlements Related to Failure to Comply with Cybersecurity Requirements - Mintz

In one press release, DOJ announced a $9.8 million settlement with Illumina Inc., alleging that the company sold genomic sequencing systems with cybersecurity vulnerabilities to certain federal agencies and did not have an adequate product security program or sufficient systems to identify and address these vulnerabilities. This settlement arose out of a qui tam action filed by a former Illumina employee in the United States District Court of Rhode Island.[1] According to DOJ, between February 2016 and September 2023, Illumina knowingly failed to incorporate sufficient cybersecurity protections and falsely represented that its software adhered to cybersecurity standards, including standards of the International Organization for Standardization and National Institute of Standards and Technology. While Illumina denied these allegations, it agreed to pay $9.8 million, of which $4.3 million was restitution. The settlement thus seems to have involved a multiplier that exceeded the 2x multiplier that typically applies in FCA settlements.

In an additional press release, DOJ announced a $1.75 million settlement with defense contractor Aero Turbine Inc. (ATI) and private equity company Gallant Capital Partners LLC (Gallant), which has a controlling stake in ATI. There, DOJ alleged that ATI violated the FCA by knowingly failing to comply with cybersecurity requirements in its contract with the Department of the Air Force. The government further claimed that between January 2018 and...



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