Double Whammy for Whistleblower in Verizon Lawsuit

Whistleblowers are making the headlines on a regular basis and none more than Stephen Shea, who having already been awarded $13.7 million for his role in the Verizon lawsuit, was granted an additional payment of almost $7.5 million in February 2012 thanks to the efforts of his whistleblower lawyer, Colette Matzzie.

The lawsuit against Verizon Communications was filed back in January 2007 when it was alleged that Verizon had submitted phony bills to the federal government for additional surcharges under two telecommunication contracts, as a means of reimbursing themselves for certain other business costs. The suit remained sealed whilst investigations were taking place and since the Government and the whistleblower couldn’t agree on the attorney’s fees, the US government intervened on February 18th 2011 and settled the action for $93.5 million including interest, paying Shea just over $13.7 million (around 15% of $91,5 million), as an advance of the ultimate share which would be decided by the court. In April 2008, the Government recovered an extra $3 million for Stock Universal Fund Surcharges that had been included in Shea’s claim. On July 27th 2011, Shea with the help of his lawyer then filed for a “Relator Share Award” asking for an additional sum of just under $7.5 million for a total overall reward of $21 million (approximately 22% of $96.5 million).

This was granted in part and denied in part, with Shea receiving 20% for his share in the settlement figure reached in February 2011 and 15% of the $3 million that the government recovered in 2008 from Verizon for Stock Universal Fund surcharges.
As explained by a whistleblower lawyer:
The False Claims Act, under which the allegations against Verizon were filed, guarantees a whistleblower a minimum percentage of 15% and a maximum percentage of 25% of the total settlement figure. The amount awarded is dependent on how much information and work the whistleblower has put into the case.
Lawyers for the Justice of Department tried to persuade the Judge not to award Shea any more money by trying to play down his involvement in the case saying that he did not have first hand knowledge of the billing arrangements that Verizon had with the government under the two contracts. They also went on to say that Shea’s complaint was little more than a lucky guess, albeit an educated one. The Judge in response said that this was a totally unfair comment given the amount of experience, expertise, knowledge, analysis, and pure hard work that Shea had carried out.
Shea at the time he filed the complaint was a managing director at TechCaliber LCC which is a leading consultant firm dealing in telecommunication and network infrastructure for their clients. It was Shea’s job to negotiate contracts for large commercial companies and also help manage the costs of the contracts. Prior to filing the complaint, he had been responsible for collecting over $50 million in overbilling charged to his clients by their carriers. It was during this work for his private clients that he reportedly discovered the fraudulent billing practices being carried out by Verizon.

There seems little doubt that Stephen Shea was highly knowledgeable and experienced in his job and thanks to using a highly experienced whistleblower lawyer to help him build the case, he was fortunate in receiving a substantial award.
Should you ever be in a position to report a large scale fraud against the Government, then this case will serve to show you that it really does pay to appoint a highly experienced attorney who has previous experience in the field of the complaint and can take a case all of the way. It’s unlikely that you’ll receive a double payout like Shea, but your attorney will work to get as large an award as possible, after all, they stand to receive a large payment.