Companies To Pay $4 Million To Settle FCA Lawsuit In Connection With Sale Of Defective Bullet-Proof Vests

Lincoln Fabrics Ltd., a Canadian weaver of ballistic fabrics, and its American subsidiary have agreed to pay the U.S. $4 million to settle a lawsuit against Lincoln for violations of the False Claims Act in connection with their role in the weaving of Zylon fabric used in the manufacture and sale of defective Zylon bullet-proof vests. 

The government alleged that the Zylon in these vests lost its ballistic capability quickly, especially when exposed to heat and humidity. The government further alleged that Lincoln was aware of the defective nature of the Zylon by at least December 2001, but continued to sell Zylon for use in ballistic armor until August 2005, when the National Institute of Justice issued a report that Zylon degraded quickly in ballistic applications. At that time, all American body armor manufacturers stopped using Zylon in body armor.
 
In October 2009, the U.S. filed suit against Lincoln for violations of the False Claims Act and related claims. The settlement resolves this lawsuit. This settlement is part of a larger investigation of the body armor industry’s use of Zylon in body armor. As part of today’s agreement, Lincoln has pledged its cooperation in the Government’s on-going investigation. The U.S. previously has settled with six other participants in the Zylon body armor industry for over $54 million. Additionally, the U.S. has pending lawsuits against Toyobo Co., Honeywell Inc., Second Chance Body Armor, Inc. and First Choice Armor Inc.
 
By the way, now, the Justice Department’s total recoveries in False Claims Act cases since January 2009 tops $3 billion.