A Sparks-based defense contractor has agreed to pay $7.75 million to settle allegations that it violated the False Claims Act by employing a government official who participated in federal contracts awarded to the company while working for both the government and the contractor.
The U.S. Attorney's Office for the Eastern District of Virginia announced the settlement Tuesday, saying Sierra Nevada Company LLC employed Michael Henry as a consultant from July 2019 through June 2020 while he also worked for the Department of War as an employee with the Joint Staff/J6.
According to federal authorities, Henry was involved in three contracts awarded to Sierra Nevada Company during that period: an Army subcontract awarded in 2019, a General Services Administration indefinite quantity/indefinite delivery contract awarded in 2020, and task orders under a Special Operations Command indefinite quantity/indefinite delivery contract that was awarded in 2018.
After joining the company as a consultant, Henry continued working in his government role, where authorities said he personally and substantially participated in the contracts by evaluating Sierra Nevada Company's products and obtaining approvals for them. While serving as a company consultant, Henry also personally and substantially participated in the same contracts on the company's behalf by recommending its products for purchase.
Federal authorities alleged Sierra Nevada Company submitted, or caused the submission of, false claims, false statements and false certifications connected to the contracts. The government alleged Henry's employment by the company and his participation in the contracts on its behalf created an organizational conflict of interest under the Federal Acquisition Regulation.
Authorities also alleged the company knowingly made, or caused to be made, material false statements, false certifications and material omissions about the absence of an organizational conflict of interest that led to the contracts being awarded.
The investigation was conducted through a coordinated effort involving the U.S. Attorney's Office for the Eastern District of Virginia, the Department of Defense Office of Inspector General Defense Criminal Investigative Service, the Department of the Army Criminal Investigation Division's Fraud Field Office and the General Services Administration's Office of Inspector General. Assistant U.S. Attorney Tanya Kapoor investigated the matter.
In 2025, Henry pleaded guilty to a one-count criminal indictment charging him with acts affecting a personal financial interest.
