“The new civil case it spoke about is not a new lawsuit against Agility, but a procedural amendment to the case that was announced in November 2009,” Agility said in a statement on the Kuwaiti bourse website.
U.S. files fresh fraud suit against Kuwait’s Agility
By Matthew Bigg – Atlanta (Reuters) – January 8, 2011 – Prosecutors have filed a civil suit against Kuwaiti logistics company Agility, accusing it of defrauding the government over food product contracts to the U.S. military in the Middle East worth $9.8 billion.
Agility was the largest supplier to the U.S. Army in the Middle East during the war in Iraq and a parallel criminal case is politically sensitive in both Washington and Kuwait.
The government aims to “recover all available damages for common law fraud, payment under mistake of fact, unjust enrichment and breach of contract,” said the suit filed on Wednesday.
The suit alleges that starting in 2003, Public Warehousing Company K.S.C. a.k.a. Agility engaged in two schemes to present false claims for payment. It also names The Sultan Center Food Products Company, K.S.C. as a defendant.
In the first scheme, the company falsely inflated prices for perishable items and local market ready items, the suit said, and in the second scheme, it overcharged the government by failing to disclose discounts it received.
Agility has long argued that it regards the entire case as a contract dispute that should be settled through negotiation.
Prosecutors first launched a criminal indictment against Agility in November 2009 for attempts to defraud the U.S. military over supply contracts in a case that is politically sensitive in both the United States and Kuwait.
This week’s civil suit appears to run in parallel with that indictment, which says the company overcharged the U.S. Army over 41 months on $8.5 billion in contracts first signed at the start of the Gulf War in 2003.
