HP to Pay $50 Million to Settle False Claims Act Suit
By Christopher M. Matthews | August 3, 2010 10:51 am

An ad for HP laptops at a Best Buy store in San Francisco. The company agreed to pay $50 million to settle two lawsuits that it submitted false claims to the U.S. government. (Getty)

Hewlett Packard Co. announced Monday that it had reached a settlement agreement in principle with the U.S. Department of Justice to resolve an investigation into alleged kickbacks paid between HP, Sun Microsystems Inc. and Accenture PLC for government contracts.

The California-based computer manufacturer will pay about $50 million to settle two lawsuits, originally filed in U.S. District Court in Little Rock, Ark., that alleged HP submitted false claims to the U.S. government for technology contracts, Bloomberg News reported Tuesday.

The case dates back to 2004, when two former employees of the consulting giant Accenture, Norman Rille and Neal Roberts, filed whistleblower suits under the False Claims Act. Those suits accused HP, Accenture and Sun, which was acquired by Oracle Corp. in January, of arranging kickback schemes that defrauded the government. The Justice Department joined the lawsuits against HP in 2007.

In a statement, HP said that settlement is subject to the approval of the Justice Department and the courts. The company also said it had agreed to the settlement without any admission of wrongdoing.

The Justice Department declined to comment to the Associated Press.

HP is also under investigation for potential violations of the Foreign Corrupt Practices Act. In April, The U.S. Justice Department and the Securities and Exchange Commission joined a widening German and Russian probe into potential bribes paid by HP executives to officials in the Russian government.

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