Office Furniture Supplier Vari Agrees To Pay $1.1 Million To Resolve Allegations Of False Claims For Overcharging Federal Agencies

SAN FRANCISCO - Varidesk, LLC and Vari Sales Corporation, two Texas companies that do business under the name VARI, have agreed to pay $1,100,000 to resolve allegations that VARI violated the False Claims Act by failing to give the United States matching price discounts VARI provided to other customers as required by VARI's contract with the General Services Administration (GSA), while falsely representing to the United States that VARI had complied with those contractual requirements.

"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."

In 2016, VARI entered into a Multiple Award Schedule contract with GSA, which 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 VARI 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.

The settlement announced today 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 its contract with the federal government, and thus knowingly caused false or fraudulent claims for payment to be made to GSA.

The civil settlement includes the resolution of claims brought under the qui tam, or whistleblower, provisions of the False Claims Act by Elliot Balis (Relator), a former VARI sales executive. Under those provisions, a private party can file an action on behalf of the United States and receive a portion of any recovery. In this case, Relator will receive $187,000 as part of the settlement. The qui tam case is captioned United States ex rel. Balis v. Varidesk LLC, et al., 22-cv-09146-JCS (N.D. Cal.).

Assistant U.S. Attorney David DeVito handled this matter for the government. The investigation and settlement resulted from a coordinated effort by the U.S. Attorney's Office for the Northern District of California and GSA-OIG.

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

Vari Settlement Agreement