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McCaskill: Are Taxpayers Reimbursing Federal Contractor Accused of Wrongdoing?

Senator asks U.S. Department of Energy to explain alleged reimbursement of Bechtel’s legal costs in contractor whistleblower suit

December 21, 2011

WASHINGTON, D.C. - U.S. Senator Claire McCaskill is asking whether taxpayers are paying for a contractor to defend itself against accusations of whistleblower retaliation.

McCaskill has sent a letter to the head of the Department of Energy's National Nuclear Security Administration (NNSA) today requesting information about the alleged reimbursement of legal costs to Bechtel Corporation, which is fighting claims of retaliation by a whistleblower employed at the Hanford Nuclear Facility in Washington state.

"The federal government relies on whistleblowers to report information about waste, fraud, abuse, and mismanagement of taxpayer dollars and has mandated whistleblower protections, including protections for employees of contractors of the National Nuclear Security Administration, to ensure that employees are not retaliated against for their disclosures," McCaskill wrote in her letter to the NNSA.

Earlier this month, McCaskill chaired a Senate hearing on boosting protections for contractor whistleblowers.  McCaskill questioned Dr. Walter Tamosaitis, who was the Research and Technology Manager of the Waste Treatment Project at Hanford.  After raising safety concerns about how radioactive waste was being processed at the site, Dr. Tamosaitis was removed from his position and relocated to a basement office.  McCaskill highlighted Tamosaitis' story to illustrate the importance of expanding whistleblower protections to government contractor employees.

At the hearing, Dr. Tamosaits testified that Bechtel, the contractor against whom he has brought a whistleblower reprisal claim, is being reimbursed for its legal expenses with taxpayer dollars.

McCaskill, Chairman of the Subcommittee on Contracting Oversight is asking the NNSA to provide information regarding its reimbursement of the legal expenses Bechtel incurred in defending against Dr. Tamosaitis' claims.  McCaskill also questioned whether that reimbursement of a contractors' legal expenses for a whistleblower action complies with a recent Federal Circuit Court decision that limited the types of legal costs which can be reimbursed under federal regulations.  

Earlier this year, McCaskill introduced legislation that would enhance whistleblower protections for non-federal employees working under governments funds, which she believes is critical to enhancing transparency and accountability in government contracting.

McCaskill's letter to the Undersecretary for Nuclear Security appears below.

 

December 21, 2011

 

The Honorable Thomas P. D'Agostino

Undersecretary for Nuclear Security & Administrator

National Nuclear Security Administration

1000 Independence Ave., S.W.

Washington, DC 20585

Dear Mr. D'Agostino: 

I am writing to request information regarding the National Nuclear Security Administration's policies regarding the reimbursement of contractors' legal expenses for defending against whistleblower reprisal claims.

On December 6, 2011, the Subcommittee held a hearing regarding whistleblower protections for government contractors.  At the hearing, Dr. Walter Tamosaitis, who was the Research and Technology Manager of the Waste Treatment Project at Hanford Nuclear Facility, testified that Bechtel Corporation, the contractor against whom he had brought a whistleblower reprisal claim, is being reimbursed for its legal expenses.  

If true, this raises serious concerns.  The federal government relies on whistleblowers to report information about waste, fraud, abuse, and mismanagement of taxpayer dollars and has mandated whistleblower protections, including protections for employees of contractors of the National Nuclear Security Administration (NNSA), to ensure that employees are not retaliated against for their disclosures.  Reimbursing a contractor's legal costs for defending against these types of claims appears to contravene these policies. 

In addition, the reimbursement of contractors' legal expenses for whistleblower actions may not comply with recent federal court decisions.  The recent Federal Circuit Court of Appeals decision in Tecom II significantly expanded the types of legal costs which cannot be reimbursed by the federal government under the Federal Acquisition Regulations, to include the costs associated with defending against third-party lawsuits except where the plaintiff has "very little likelihood of success."    

To assist the Subcommittee in its oversight, I request that you provide the Subcommittee with information regarding the NNSA's reimbursement of contractors' legal costs to defend against Dr. Tamosaitis, including the amount of the reimbursement and any correspondence relating to the decision that these costs were allowable under the contract and under Tecom II.  I also request that you provide a briefing to the Subcommittee staff on these issues, including NNSA's policies regarding the reimbursement of contractors' legal expenses for whistleblower reprisal claims, as soon as possible, but in no case later than Friday, January 20, 2012.

The jurisdiction of the Subcommittee on Contracting Oversight is set forth in Senate Rule XXV clause 1(k); Senate Resolution 445 section 101 (108th Congress); and Senate Resolution 73 (111th Congress).  An attachment to this letter provides additional information about how to respond to the Subcommittee's request.

I appreciate your assistance.  Please contact Sarah Garcia with the Subcommittee staff at (202) 224-1014 with any questions.  Please send any official correspondence relating to this request to kelsey_stroud@hsgac.senate.gov.                                                       

Sincerely,

(s)

Claire McCaskill        

Chairman        

Subcommittee on Contracting Oversight

 

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