Navy Sank $3M Contract Despite Bad Bond Probe, Suit Says

Law360, New York (September 17, 2013, 1:34 PM EDT) -- Allen Engineering Contractor Inc. says the U.S. Navy reneged on a $2.9 million construction contract for a California Marine Corps base even though it negligently investigated performance bonds securing the contract, according to a lawsuit filed Monday in the U.S. Court of Federal Claims.

Allen Engineering had submitted payment and performance bonds for the project, and when it substituted the old bonds with new ones, the U.S. Navy investigated the new bonds and said they were OK. In reality, the suit says, the bonds were fraudulent,...
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