Verizon pays $93.5M to settle whistleblower suit

AP News
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Posted: Apr 05, 2011 2:36 PM
Verizon pays $93.5M to settle whistleblower suit

Verizon Communications Inc. has paid $93.5 million to settle allegations that it overcharged the federal government, the Justice Department said Tuesday.

The lawsuit was filed by Stephen Shea, a "whistleblower" in 2007, and alleged overbilling as far back as 1999, first by MCI Communications, and later by Verizon, which bought MCI in 2006.

The lawsuit alleged that Verizon had billed the government for "tax-like" surcharges that it wasn't entitled to impose on the government, according to the law firm representing Shea, Phillips & Cohen LLP.

"This settlement concludes efforts by both parties to resolve this dispute amicably, without further litigation," said Verizon spokesman Peter Lucht.

The lawsuit had been under seal, meaning it wasn't publicly known, until it was revealed as settled on Tuesday.