Office furniture supplier pays $1.1 million to settle claim it overcharged feds

SAN FRANCISCO – Vari, a Texas-based supplier of standing desks and other office furniture, will pay the federal government $1.1 million in a settlement for allegedly violating the False Claims Act and failing to give the U.S. matching price discounts that it gave other customers.

The case, brought forward in the U.S. Attorney’s Office, Northern District of California, alleges that Vari entered into a Multiple Award Schedule contract with the U.S. General Services Administration in 2016. That contract provided a streamlined process for federal government purchasers to buy office furniture from Vari at discounted prices and required Vari to comply with specific conditions. Vari promised that GSA would receive discounts that were equivalent to those it provided to other customers in the “basis-of-award” category defined by the contract.

Under the contract’s price-reduction clause, whenever Vari provided discounts to basis-of-award customers that were greater than those given to GSA, Vari was required to disclose promptly those discounts to GSA and provide price-matching refunds.

This settlement resolves the government’s allegations that, from Dec. 8, 2016, through June 30, 2019, Vari knowingly failed to provide GSA with price discounts that it provided to other customers in the basis-of-award category, in violation of the contract, and “thus knowingly caused false or fraudulent claims for payment to be made to GSA.”

“Companies must deal honestly with federal agencies and comply fully with the requirements of their federal contracts,” said Acting United States Attorney Patrick D. Robbins. “The False Claims Act is a critical tool to deter and hold accountable contractors who misuse public funds, and we will vigorously enforce it when taxpayers are overcharged.”

“GSA contractors should not overcharge federal agencies at the expense of the public fisc,” said GSA Deputy Inspector General Robert Erickson. “I appreciate the efforts of the special agents, auditors and attorneys who worked on this case.”

The case was brought forward by a whistleblower, who per the “qui tam” provisions of the False Claims Act, will receive a portion of the recovery. The whistleblower was identified as Eliot Balis, a former Vari sales executive. Balis will receive $187,000 as part of the settlement.

The claims resolved by the settlement are allegations only, and there has been no determination of liability.

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