A Utah defense contractor will pay a settlement worth nearly $37 million to the federal government after a whistle-blower alleged the company was selling dangerously explosive flares to the U.S. Air Force.
The settlement with ATK Launch Systems Inc., announced Monday by the U.S. Justice Department, includes a cash payment of $21 million and labor worth nearly $16 million to repair 76,000 flares the government has bought.
The illuminating para-flares burn to at least 3,000 degrees Fahrenheit and have been used by U.S. troops in Iraq and Afghanistan for illumination in nighttime combat, covert operations and search and rescue activities.
The government claimed the flares risked exploding when subject to a 10-foot drop test, in violation of the military's requirements and that ATK knew that even as it collected payment for the flares.
"Our men and women in combat deserve equipment that meets critical safety and performance requirements," said Stuart F. Delery, acting assistant attorney general for the Civil Division. "This case demonstrates that the Department of Justice will pursue cases where contractors knowingly provide defective equipment that puts the safety of American military service members at risk."
ATK spokesman George Torres noted that the case originated with flares sold by Thiokol, which ATK bought in 2003; the lawsuit deals with flares sold from 2000 to 2006.
Torres would not comment on the government's claim that the company knew about the alleged defects.
"ATK welcomes the resolution of this matter," he said.