FreshPoint, Inc., a Houston-based subsidiary of Sysco Corp., has agreed to pay $4.2 million to resolve a False Claims Act lawsuit relating to the prices it charged the government for fresh fruit and vegetables.
According to the whistleblower’s allegations, FreshPoint improperly inflated its prices to reflect its view of the prevailing market price of the goods at the time of sale. Pursuant to its contracts with the government, FreshPoint was required to supply the produce at cost, plus a pre-established markup as its profit, and was forbidden from making further price adjustments based upon its perception of changes in market prices.
The whistleblower, a former employee of FreshPoint, will receive $798,000 from the settlement proceeds as his award for exposing FreshPoint’s pricing practices by filing a False Claims Act lawsuit.
For more information on this case, click here: http://www.justice.gov/opa/pr/2013/November/13-civ-1233.html