Attorneys also said that Universal Concrete management learned of the alleged falsification in February 2016 but fired a company official who was pushing for an internal audit surrounding the allegations. They allege that the fabrication persisted for another year.
The pattern of records falsification began before October 2015 and lasted until at least February 2017, the lawsuit says.
Universal Concrete manufactured more than 1,500 panels used to build exterior walls at five of the six new stations for Phase 2 of the project, which will extend the Silver Line to Dulles International Airport and into Loudoun County. The Metropolitan Washington Airports Authority is overseeing the construction of the $5.8 billion Silver Line, and the federal government has provided nearly $2 billion in loans for the project; the state of Virginia has provided more than $300 million in funding.
According to the lawsuit, as it manufactured the panels under a $6.1 million contract, Universal Concrete billed project contractor Capital Rail Constructors for materials that were known to be defective. That led to a chain of false claims, according to the attorneys, in which Capital Rail Constructors billed MWAA based on false assertions of durability and MWAA told the federal government that the panels met manufacturing specifications when they did not.
“Relying on MWAA’s certifications, [the U.S. Department of Transportation] approved disbursement of federal funds to MWAA to pay for panels that UCP manufactured that did not meet contractual specifications,” the lawsuit says. “. . . Had DOT known that UCP manufactured panels [that] did not comply with contractual specifications for air content, which may affect the durability of the concrete panels, it would have influenced DOT’s decision to disburse payment to MWAA for the UCP manufactured panels.”
The suit seeks unspecified damages and civil penalties from the defendants: Universal Concrete; its president, Donald Faust Jr.; and its former quality-control manager, Andrew Nolan, who is Faust’s nephew. Nolan declined to comment through his attorney. Faust and Universal Concrete also declined to comment through their attorney.
The federal government and Virginia intervened on behalf of whistleblower Nathan Davidheiser, a former employee of Universal Concrete who says he was fired after repeatedly questioning problems with the company’s manufacturing process. “We are of course happy that the government has intervened in the case,” said David Scher of the Employment Law Group, who is representing Davidheiser. “We’re cooperating closely with the government.”
The government’s complaint sheds further light on an alleged pattern Davidheiser detailed in his March 2016 lawsuit, which was unsealed in May.
His lawsuit alleges that Nolan produced false records on the air content of the panels and that, under his direction, others in his department falsified documents to show the panels met standards. In one case, on or about Dec. 18, 2015, Nolan was asked to release quality-control records, attorneys said. “We cannot give them sheets with any testing data out of specs,” he told Davidheiser, according to the suit. “They will reject those panels. We have to change the data.”
Another time, the complaint says, an employee in the unit took records from Universal Concrete and falsified them at home.
Meanwhile, the suit says, management ignored the falsification.
The suit names another employee who emailed Faust to say that quality-control errors were being covered up. The employee said that “everybody on the floor” knew a former employee “has seen [Nolan] cooking the books of the lab testing procedures.” The complaint says that Faust forwarded the email to the company’s vice president, Marc Davis.
“Neither Faust nor Davis attempted to determine whether the allegations that Nolan was falsifying QC records were accurate,” the complaint says.
Later, in December 2015, a plant manager relayed to Davis another employee’s account that quality control “cooks all the books and he has the pictures to prove it.” The plant manager allegedly told Davis to lower that employee’s pay or fire him.
“Says he has pictures. What the hell is that and what does that say about him,” the plant manager said, according to the lawsuit.
Finally, in February 2016, Davidheiser wrote an email to Davis detailing the alleged records falsification.
Concrete “is being poured out of specification,” he wrote. “I am being asked to constantly falsify data that we send out to our clients in order to appear that the concrete is in specification.”
In a subsequent email to management, Davis said he was troubled by the allegations and planned to conduct an internal audit, according to the complaint. But two days before the audit was set to take place, Faust fired Davis, according to the suit. Davidheiser filed the suit the following month.
“UCP’s QC employees continued to falsify quality control records for the air content of panels produced for the Dulles Project at least until February 2017,” the suit says.
The federal government seeks penalties and damages on two counts under the federal False Claims Act. Virginia seeks the punishments on another two counts under the Virginia Fraud Against Taxpayers Act. And both Virginia and the federal government seek damages under a count of payment by mistake and another of unjust enrichments, both “in an amount to be determined at trial.” Their suits ask for a jury trial.