3 companies reach settlement in False Claims Act suit

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YRC Freight Inc., Roadway Express Inc. and Yellow Transportation Inc. will pay about $6.85 million to resolve allegations they overcharged the Department of Defense for hauling military freight.

In a lawsuit filed under the False Claims Act, the companies also were accused of making false statements to hide the misconduct.

The defendants contracted with DOD to ship military freight across the country from September 2005 to October 2013. Payment was based partly on weight.

The United States accused the companies of fraudulently billing for higher weights than were actually transported for seven years.

The defendants also were accused of making false statements that they would comply with the rules requiring them to correct discrepancies.

The civil settlement includes the resolution of claims brought under whistleblower provisions of the False Claims Act by James Hannum, an employee of Yellow Transportation.

Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. Hannum will receive $1.3 million, plus interest, as his share of the settlement.