United States Sues Sprint Under the False Claims Act Alleging Overbilling on Wiretaps

Written March 4, 2014 by Robert Lu

On Monday, March 3, media outlets reported that the U.S. Justice Department had filed a lawsuit under the False Claims Act alleging that Sprint Corp. overcharged the Federal Bureau of Investigation, the Drug Enforcement Administration and other law-enforcement agencies by more than 50% to facilitate conventional eavesdropping on phone calls.

The suit accuses Sprint of inflating the bills it submitted to federal law-enforcement agencies for wiretaps and other surveillance services to cover capital expenditures necessary to respond to the requests—something prohibited by federal law and Federal Communications Commission rules. Telecommunications companies are allowed to charge law enforcement for wiretaps, but must go through a separate process to recoup some of the cost of setting up the systems needed to respond to government requests. As a result of the improper billing, according to the government, Sprint was overpaid by $21 million over a period of three and a half years.

The lawsuit was filed under the False Claims Act, which allows courts to award up to three times the amount overpaid by the government, as well as penalties for each false claim. For more information about the False Claims Act, please visit the Robbins Geller Rudman & Dowd False Claims Act page.