Trial Date Set for Alleged $720m Coast Guard Contract Fraud

| Wed Oct. 14, 2009 8:25 AM PDT

A $720 million whistleblower lawsuit against Lockheed Martin and Northrop Grumman, two of America's biggests military contractors, can move forward, a US District judge has ruled.  Michael DeKort, the whistleblowing former Lockheed engineer, says the companies wasted taxpayer dollars and didn't fulfil the terms of their contracts under the Coast Guard's $26 billion Deepwater modernization program. The Deepwater program has a history of problems—eight ships that were supposed to be modernized ended up structurally unsound, for example—but the government has yet to recover the money it paid the contractors for what DeKort (and government reports) said was shoddy work. DeKort is aiming to change that by bringing his suit under the False Claims Act, which allows citizens to sue to recover government money and keep some of the winnings for themselves. A trial date is set for November 2010.

The judge gave the defendants until the end of the day on Wednesday to file any new motion to dismiss DeKort's case.

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