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Department of Defense Contractors Agree to Pay the U.S. Government $5.5 Million for Allegedly Supplying the Military with Low-Grade Batteries for Humvee Gun Turrets Used in Iraq; Minnesota Whistleblower to Receive $990,000

On September 16, 2014, the Department of Justice (DOJ) announced that Department of Defense (DOD) contractors, M.K. Battery, Inc. (M.K. Battery), East Penn Manufacturing Company (East Penn), NPC Robotics, Inc. (NPC), BAE Systems, Inc. (BAE) and BAE Systems Tactical Vehicle Systems LP (BAE) had agreed to a settlement of $5.5 million for allegedly violating the False Claims Act (FCA) by selling the U.S. Military substandard batteries for Humvee gun turrets used on military combat vehicles in Iraq. Minnesota whistleblower, David McIntosh, former employee of M.K. Battery, will receive $990,000 which represents his share of the settlement for reporting fraud against the government – in this case misrepresentation of a vital product supplied to the DOD.

A gun turret is a weapon mount that protects the crew or mechanism of a projectile-firing weapon and at the same time lets the weapon be aimed and fired in many directions. Sealed acid batteries are used as a backup to turn the turrets on the Humvees in the event that the engine gives out.  According to Mr. McIntosh, and unbeknownst to the Army, the manufacturing process of the batteries was allegedly changed from the original design presented to the DOD, consequently cutting the battery’s life span by as much as 50 percent and potentially putting U.S. Troops in harm’s way.  Mr. McIntosh, from Stacy, Minnesota, who at the time was employed by M.K. Battery as a regional sales representative, brought his concerns to top company officials at M.K. Battery.  However, in 2007 after numerous unsuccessful attempts to convince M.K. Battery that its decision to cut costs on these batteries could be hazardous to U.S. Troops, especially during combat, Mr. McIntosh alerted the DOD to this matter.  Three month later, M.K. Battery fired Mr. McIntosh.

Shortly thereafter, Mr. McIntosh and his attorneys filed the lawsuit under the whistleblowers provisions of the False Claims Act, which is one of the most effective methods that the government has implemented for combating fraud. Under the FCA, any person, who knows of an individual or company that has defrauded the federal government, can file a “qui tam” lawsuit to recover damages on the government’s behalf.  Mr. McIntosh filed this particular lawsuit on behalf of himself and the Department of Defense. Additionally, a whistleblower who files a case against a company that has committed fraud against the government, may receive an award of up to 30 percent of the settlement. In this case, Mr. McIntosh’s share of $5.5 million is approximately 18 percent of the settlement.

© 2020 by Tycko & Zavareei LLPNational Law Review, Volume IV, Number 262


About this Author

Jonathan K. Tycko leads the Whistleblower Practice Group of Tycko & Zavareei LLP

In recent years, the laws of the United States have undergone a whistleblower revolution. Federal and state governments now offer substantial monetary awards to individuals who come forward with information about fraud on government programs, tax fraud, securities fraud, and fraud involving the banking industry. Whistleblowers also now have important legal protections, designed to prevent retaliation and blacklisting.

The law firm of Tycko & Zavareei LLP works on the cutting edge of this whistleblower revolution, taking on even the most complex and confidential whistleblower...