The Law Firm of Piacentile, Stefanowski & Malherbe LLP

Textile Manufacturer Heytex has agreed to pay $3 million in a Settlement with the Government to Resolve Allegations of Fraud

Textile manufacturer Heytex has agreed to pay $3 million in a settlement with the government to resolve allegations of fraud. Founded in 1913 in Germany as a company that weaved sail cloth, Heytex has managed to stay in business for more than 100 years through innovation and expansion. With four manufacturing plants, they now provide many different types of products and are a major player in the worldwide textile market. As part of its expansion, Heytex established Heytex USA in Virginia and focused this branch on producing materials for the US military.

As part of their deal with the US military, Heytex had to perform a series of tests on its products to determine if they qualify as “military-grade” according to the military’s standards. On over 100 different occasions between 2013 and 2018, Heytex USA had been these falsifying test results. The fabrics failed to meet military standards, yet they lied about it and sold those fabrics as “military-grade”. The US government became aware of this scam thanks to one Heytex employee who blew the whistle using the qui tam provision of the False Claims Act.

The US government was able to recover $3 million thanks to this whistleblower and the combined labor of the United States Attorney’s Office for the Western District of Virginia, the Defense Criminal Investigative Service, and the United States Army Criminal Investigations Division. In addition to the monetary settlement, the Defense Logistics Agency will work with Heytex to ensure they remain in compliance with the testing requirements moving forward.

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