AAR AND ITS SUBSIDIARY, AAR AIRLIFT GROUP, AGREE TO PAY $11 MILLION TO RESOLVE FALSE CLAIMS ACT
August 16, 2021
On July 6, 2021, the Department of Justice (DOJ) issued a press release announcing AAR Corp. and its subsidiary, AAR Airlift Group Inc. (Airlift), have agreed to pay the United States $11,088,000 to resolve False Claims Act allegations in connection with the aircraft maintenance services performed by Airlift on two U.S. Transportation Command (TRANSCOM) contracts. The allegations involve helicopters that Airlift owned and maintained for use in transporting Department of Defense (DOD) cargo and personnel in support of missions in Afghanistan and Africa. Airlift knowingly failed to maintain nine aircraft pursuant to contract requirements, deeming the helicopters as not airworthy nor certifiable by Airlift as “fully mission capable.” The settlement resolves claims brought by a former Airlift employee under the whistleblower provisions of the False Claims Act. The former employee will receive $2,162,160 of the settlement pursuant to the False Claims Act. In addition to this settlement, AAR and Airlift have agreed to pay $429,273.69 to the FAA to resolve a separate matter involving deficiencies in Airlift’s helicopter maintenance.
The settlement obtained in this matter was the result of a coordinated effort between the Civil Division’s Commercial Litigation Branch, Fraud Section; the U.S. Attorney’s Office for the Southern District of Illinois; and the U.S. Attorney’s Office for the Middle District of Florida, with assistance from the U.S. Transportation Command, the FAA, Air Force Office of Special Investigations (OSI), Defense Criminal Investigative Service (DCIS), Naval Criminal Investigative Service (NCIS), Army Criminal Investigation Command (CID), Department of Transportation Office of Inspector General, the Defense Contract Audit Agency (DCAA) and Special Inspector General Afghanistan Reconstruction (SIGAR).
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com or 202-659-6622); Drew Derco (dderco@eckertseamans.com or 202-659-6665), or Andy Orr (aorr@eckertsemans.com or 202-659-6625).
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