Lieff Cabraser Civil Justice Blog

$77.5 Million Settlement Approved in Office Depot False Claims Act Suit

$68 Million Settlement Approved in Office Depot False Claims Act Suit

Earlier this month, the Superior Court approved a $77.5 million settlement with Office Depot that will provide substantial recoveries to cities, counties, and school districts across California.

“The Office Depot case serves as a reminder that many state false claims laws offer whistleblowers as well as county and local governments the means to hold accountable companies that fail to deliver on discounted prices as promised or engage in other forms of deceptive pricing,” stated Lieff Cabraser attorney Lexi J. Hazam.

The whistleblower was a former Office Depot account manager who brought the qui tam action under the California False Claim Act. The City of Los Angeles, County of Santa Clara, Stockton Unified School District, and 16 additional California cities, counties, and school districts intervened in the action to assert their claims (including common-law fraud and breach of contract) against Office Depot directly.

The governmental entities purchased office supplies from Office Depot under a nationwide supply contract known as the U.S. Communities contract. Office Depot promised in the U.S. Communities contract to sell office supplies at its best governmental pricing nationwide. The complaint alleged that Office Depot repeatedly failed to give most of its California governmental customers the lowest price it was offering other governmental customers. Other pricing misconduct was also alleged.

Robert J. Nelson and Lexi J. Hazam of Lieff Cabraser represented the whistleblower and the California cities, counties, and school districts that intervened in the suit, together with Eric Havian, Stephen Hasegawa and Edward Arens of Phillips & Cohen LLP; Altomease Kennedy of Sanford Heisler; and Mark Kleiman of the Law Office of Mark Kleiman.