Delta Airlines to Pay $10.5 Million to Settle False Claims Act Allegations

The Department of Justice announced June 30 that Delta Airlines Inc. has agreed to pay $10.5 million to resolve alleged liability under the False Claims Act for falsely reporting information about the transfer of U.S. mail to foreign posts or other intended recipients under contracts with the U.S. Postal Service. Delta is an international air carrier incorporated in Delaware with headquarters in Atlanta, Georgia.

“The United States expects the air carriers with which the USPS contracts to accurately report the services they provide,” said Brian Boynton, principal deputy assistant attorney general and head of the DOJ’s civil division, in a statement. “The resolution announced today reflects the department’s commitment to pursuing contractors that do not meet their contractual obligations to the United States and misrepresent their failure to perform.”

USPS contracted with Delta to take U.S. mail at six locations in the U.S. or at various Department of Defense and State Department locations abroad and then deliver that mail to numerous international and domestic destinations. To obtain payment under the contracts, Delta was required to submit electronic scans of the mail to USPS reporting the time the mail was delivered at the identified destinations. The contracts specified penalties for mail that was delivered late or to the wrong location. 

The settlement resolves allegations that scans submitted by Delta falsely reported the time and fact that it transferred possession of the mail. 

“The USPS contracts with commercial airlines for the safeguarding and timely delivery of U.S. mail to foreign posts, including the mail sent to our soldiers deployed to foreign operating bases,” Ken Cleevely, USPS’ Office of Inspector General executive special agent in charge, said in a statement. “The OIG supports the Postal Service by aggressively investigating allegations of contractual non-compliance within the mail delivery process, including the falsification of delivery information. Our special agents worked hand-in-hand with the Department of Justice to help ensure a reasonable resolution and we applaud the exceptional work done by the investigative and legal teams.”

The civil division’s commercial litigation branch, fraud section, aided in this effort with substantial assistance from the USPS OIG and the USPS Office of General Counsel. Senior trial counsel Don Williamson of the civil division’s commercial litigation branch, fraud section, represented the government in the civil case. This is the sixth civil settlement involving air carrier liability for false delivery scans under the USPS ICAIR contracts. Collectively, the U.S. has recovered more than $80 million as a result of its investigation of such misconduct. 

The DOJ noted the claims resolved by the settlement are allegations only and there has been no determination of liability.

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