Sodexo, a multi-billion dollar company that serves meals to 10 million customers everyday at schools, universities, hospitals and nursing homes, recently settled a whisteblowing qui tam case for $20 million. Call our Whistleblower Attorneys for a free telephone consultation at (800) 893-9645 to learn if your employer is engaging in unlawful conduct that could form the basis of a whistleblower case.
John and Jay Carciero, former general managers for Sodexo, discovered that Sodexo forced food and beverage vendors to kick back huge rebates and then pocketed the money. According to the contracts that Sodexo had with government agencies, Sodexo was required to pass on the savings rather then keep these “off-invoice rebates.” Sodexo was, on average, getting a 14% rebate from its suppliers which it was illegally profiting. Under New York law, a food vendor cannot retain any rebate it receives but must pass it on to its customers. The reasoning behind this law is that vendors would otherwise pressure their food customers to buy from the companies giving them the highest off-invoice rebate rather than the best price or product.
Faced with retaliation, being demoted or fired from their jobs, the two Carciero brothers stayed firm in their determination to stop Sodexo’s fraud against the government. The Carciero brothers filed a qui tam whistleblower lawsuit against Sodexo alleging violations under the False Claims Act. In a qui tam lawsuit, if the government recovers any funds, the whistleblowers are rewarded with a percentage of the monies recovered which could be anywhere from 15 to 20%. Of the $20 million settlement, the Carciero brothers will receive $3.6 million, New York State will get $15 million and the rest will be distributed to the affected schools.
Sodexo’s illegal practices not only hurt the government but all taxpayers as well. If you work for a company that is committing a fraud or cheating the government and taxpayers, call our experienced New York, New Jersey and Connecticut Whistleblower Qui Tam Attorneys at (800) 893-9645 to discuss your possible case.
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