Maersk Settles False Claims Case with U.S. DoD

Maersk Line Limited has agreed to pay the U.S. government $31.9 million to settle allegations that Maersk “knowingly overcharged” the U.S. Department of Defense for transporting cargo via shipping containers to Iraq and Afghanistan.  The U.S. alleges that Maersk overcharged the government for thousands of containers carrying cargo to support U.S. troops from ports to inland delivery destinations in Iraq and Afghanistan.

The government says that Maersk inflated invoices in various ways including billing more than the agreed contractual rate, billing excessive detention charges (late fees), billing for container delivery delays improperly attributed to the U.S. government, billing for GPS-tracking and security services that were not provided, or only partially provided, and failing to credit the government for rebates of container storage fees.  As gCaptain reported earlier, the Pentagon has paid Maersk an astounding $720 million in late fees on shipping container rentals since 2001.

The settlement resolves all allegations against Maersk that were filed in San Francisco by Jerry H. Brown II, a former industry insider. The lawsuit was filed under the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to bring lawsuits on behalf of the United States and receive a portion of the proceeds of a settlement or judgment.  Brown, in this case, will receive $3.6 million.

Subscribe for Daily Maritime Insights

Sign up for gCaptain’s newsletter and never miss an update

— trusted by our 108,595 members