Alabama Defense Contractor and Its President to Pay $200,000 to Resolve False Claims Act Allegations

WASHINGTON – Future Research Corp., located in Huntsville, Ala., and its president, Jesse Nunn, have agreed to pay the United States $200,000 to settle claims that they inappropriately obtained contracts from the Navy, the Justice Department announced today. The contracts had been set aside for companies that qualified for the Small Business Administration’s (SBA) Historically Underutilized Business Zone (HUBZone) program. Future Research Corp. bid on and received the Navy contracts even though it was not qualified for the HUBZone program at that time.

Under the HUBZone program, companies that maintain their principal office in a designated HUBZone and employ 35 percent of their workforce from a HUBZone, among other requirements, can apply to the SBA for certification as a HUBZone small business company. HUBZone companies can then use this certification when bidding on government contracts. In certain cases, government agencies will restrict competition for a contract to HUBZone-certified companies.

The United States alleged that Future Research Corp. did not actually maintain its principal office in a designated HUBZone location in Huntsville at the time it bid on and received certain Navy contracts, but elsewhere in Huntsville in a location that was not designated as a HUBZone. Despite not properly qualifying for the HUBZone program, Future Research Corp. was awarded Navy contracts that had been set aside for qualified HUBZone companies based upon the false certifications the company and Nunn made to the Navy.

“HUBZone contracts should be used for their intended purpose: to support small business owners who are creating jobs in economically disadvantaged communities,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice. “When non-qualified companies inappropriately obtain these contracts, we will take action.” 

“The HUBZone program should provide capital to economically disadvantaged areas, increasing job creation and community development. Contractors obtaining these set-aside contracts with false statements take a vital opportunity away from targeted small businesses. The SBA Office of the Inspector General will continue to partner with the Department of Justice to aggressively pursue criminal and civil cases,” said SBA Inspector General Peggy E. Gustafson.

“This case represents the cooperative effort of SBA’s Offices of the General Counsel and the Inspector General and the Department of Justice to uncover and remedy fraud in our procurement programs,” said SBA General Counsel Sara Lipscomb.

Assistant Attorney General West thanked the Justice Department’s Civil Division, the SBA Office of General Counsel, the SBA Office of Inspector General and the Department of the Navy for the collaboration that resulted in the settlement announced today.