Fifth Circuit decision exposes contractors to vicarious liability for double damages when employees receive personal kickbacks

Fifth Circuit decision exposes contractors to vicarious liability for double damages when employees receive personal kickbacks

In a case of first impression with potentially far-reaching consequences, the Fifth Circuit has ruled that a contractor may be held vicariously liable for double damages under the Anti-Kickback Act (AKA) even when the kickback is taken by an employee, not the contractor.  United States ex rel. Vavra, et al., v. Kellogg Brown & Root, Inc. (KBR), No. 12-40447 (5th Cir. Jul. 19, 2013). Thus, having first been victimized by a dishonest and disloyal employee, a contractor may then also suffer enhanced civil penalties in a lawsuit by a qui tam relator and/or the Department of Justice. Click here to read more.

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