Hybrid Tech Holdings LLC, Hybrid Technology LLC, and Ace Strength International LTD, have agreed to resolve allegations that they violated the False Claims Act by colluding to rig the bidding of an auction to purchase the United States Department of Energy’s non-performing loan to Fisker Automotive Inc. and Fisker Automotive Holdings Inc, the Department of Justice announced today.

“The department is committed to ensuring a level playing field for those who seek to do business with the government,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “As today’s settlement demonstrates, the department will take appropriate action where it determines that this principle has been violated.”

The government alleged that the defendants exerted pressure on the two other competing bidders to suppress their bids during the live auction, thereby depriving the Department of Energy of a fair bidding process and reducing the amount ultimately recovered in the auction. As a result, the defendants were able to acquire the non-performing loan secured by the assets of Fisker Automotive for far less than the fair market value of the loan.

“This settlement reflects our Office’s commitment to hold accountable those who exploit the system for their own personal gain,” said U.S. Attorney Jessie K. Liu for the District of Columbia. “Companies working with the federal government must perform their obligations with transparency and fairness and we will continue to work with our law enforcement partners to pursue and penalize those who violate the False Claims Act.”

The settlements resolve allegations originally filed in a lawsuit by William R. Baldiga and the FAH Liquidating Trust, the successor to the Official Committee of Unsecured Creditors of Fisker Automotive Holdings Inc. The suit was filed in federal court in the District of Columbia pursuant to the qui tam, or whistleblower, provisions of the False Claims Act, which permit private individuals to sue on behalf of the government for false claims and to share in any recovery. Mr. Baldiga’s and the Trust’s share of the settlement will be $5,220,000.

The settlements were the result of a coordinated effort by the Civil Division of the Department of Justice, the United States Attorney’s Office for the District of Columbia, and the United States Department of Energy Office of General Counsel and Office of Inspector General.

The case is captioned United States ex rel. Baldiga et al v. Hybrid Tech Holdings, LLC et al, No. 15-00019 (D.D.C). The claims resolved by the settlements are allegations only.

This case was investigated by Assistant U.S. Attorneys John Truong and Heather Graham-Oliver from the U.S. Attorney’s Office for the District of Columbia and Trial Attorney John W. Black with the Department of Justice’s Commercial Litigation Branch.