SAIC, others pay $22.7 million to resolve contracting case

Two government employees steered a $3.2 billion computing contract to SAIC and a subcontractor, a lawsuit alleged

Science Applications International (SAIC), a subcontractor and two former government employees will pay nearly US$22.7 million to resolve allegations that they rigged bids for a $3.2 billion supercomputing contract with the U.S. General Services Administration, the U.S. Department of Justice announced Thursday.

Whistleblower David Magee, a former computer scientist at the U.S. Naval Oceanographic Major Shared Resource Center in Mississippi, alleged that two top-ranking employees at the center helped steer the contract to SAIC and subcontractor Applied Enterprise Solutions, owned by a former government employee.

SAIC will pay $20.4 million to resolve Magee's False Claims Act lawsuit, filed in U.S. District Court for the Southern District of Mississippi, the DOJ said in a press release. Applied Enterprise Solutions and its CEO, Dale Galloway, will pay nearly $2.2 million, and former government employees Stephen Adamec and Robert Knesel will pay $110,000, the DOJ said.

SAIC is confident its conduct was "lawful and in keeping with standard industry practice," a spokeswoman said. "But in the end the company decided it was more important to focus attention on managing the company rather than incurring the risks, costs and distractions of continued litigation."

Galloway did not return an email seeking comment.

The Mississippi center provides high-performance computing services for the U.S. Department of Defense, according to court documents. The contract, in which SAIC and Applied Enterprise Solutions teamed with Lockheed Martin, was to provide technology support services for the National Center for Critical Information Processing and Storage at the Mississippi center, the DOJ said.

SAIC was paid $116 million under the contract, the DOJ said. The DOJ joined the lawsuit against all the defendants except Lockheed Martin shortly after Magee filed the case. Lockheed Martin has previously settled the case for $2 million.

Adamec is the former director of the Mississippi center, while Knesel was deputy director, according to court documents. Magee's lawsuit alleged that the two of them worked with Galloway on the GSA contract. Galloway, former director of the DOD's Space and Naval Warfare Systems Command Information Technology Center, resigned in June 2003 and started Applied Enterprise Solutions with his wife, according to court documents.

Adamec and Knesel shared nonpublic, advance procurement information with the SAIC team, the lawsuit alleged. The two former government employees shared information with the SAIC team before providing that information to other bidders, and they wrote a contract that favored the SAIC team, the DOJ and Magee alleged.

Whistleblowers in False Claim Act contracting lawsuits can share in the money recovered by the DOJ.

Grant Gross covers technology and telecom policy in the U.S. government for The IDG News Service. Follow Grant on Twitter at GrantGross. Grant's e-mail address is grant_gross@idg.com.

Join the PC World newsletter!

Error: Please check your email address.

Tags Government use of ITCivil lawsuitshardware systemsDale GallowaygovernmentScience Applications Internationallockheed martinDavid MageeRobert KneselApplied Enterprise SolutionHigh performanceStephen Adameclegal

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Grant Gross

IDG News Service
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Azadeh Williams

HP OfficeJet Pro 8730

A smarter way to print for busy small business owners, combining speedy printing with scanning and copying, making it easier to produce high quality documents and images at a touch of a button.

Andrew Grant

HP OfficeJet Pro 8730

I've had a multifunction printer in the office going on 10 years now. It was a neat bit of kit back in the day -- print, copy, scan, fax -- when printing over WiFi felt a bit like magic. It’s seen better days though and an upgrade’s well overdue. This HP OfficeJet Pro 8730 looks like it ticks all the same boxes: print, copy, scan, and fax. (Really? Does anyone fax anything any more? I guess it's good to know the facility’s there, just in case.) Printing over WiFi is more-or- less standard these days.

Ed Dawson

HP OfficeJet Pro 8730

As a freelance writer who is always on the go, I like my technology to be both efficient and effective so I can do my job well. The HP OfficeJet Pro 8730 Inkjet Printer ticks all the boxes in terms of form factor, performance and user interface.

Michael Hargreaves

Windows 10 for Business / Dell XPS 13

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre x360

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga 910

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?