The U.S. Justice Department has filed a civil suit against a large white-owned Prince George's County construction firm charging that in 1976 the firm used a fictitious minority business to obtain a lucrative federal contract reserved for small businesses.
The 12-page complaint filed in Baltimore U.S. District Court Friday contends that officers of Excavation Construction, Inc. and R & W Construction Co., the allegedly fraudulent minority firm, knew that bids and applications submitted for a $2.5 million excavation contract at the U.S. Naval Academy in Annapolis contained "fictitious or fraudulent" information.
The suit lists as defendants R & W, ECI and its corporate officers Larry A. Campbell, Stanley M. Aronin and George Reider, and Travelers Indemnity Co. It demands that the defendants pay $337,500 in fines, $301,500 in damages and repay an undetermined amount of profits earned from the contract to the federal government.
Baltimore attorney Arnold Weiner, who represents ECI and formerly represented ex-governor Marvin Mandel, called the government's suit "silly" and said that to his knowledge there are no grounds for the complaint.
The court papers contend that R & W in preparing for the contract appointed ECI as its management agent and to provide bidding, bonding, engineering, field supervision services and sub-contractors and gave ECI the authority to sign all checks and approve all requisitions.
"Neither defendants ECI . . . nor R & W . . . disclosed the existence of the agreement, nor the ownership or control of R & W by ECI . . . ."