A whistleblower complaint filed by an Office Depot employee has resulted in an $80 million settlement for the state of California. The complaint was made in 2009 by an Office Depot business manager who claimed that the company was overcharging the city of Los Angeles and other sections of California government. The recent $80 million settlement includes $8.7 million for the city of Los Angeles. Following his death earlier this year, the employee’s family filed a lawsuit against Office Depot that is currently pending.
Various jurisdictions of California government had contracts with Office Depot guaranteeing that they are charged “most favored public entity” prices for products purchased from the retailer. Despite the guarantee, Office Depot signed subsequent contracts with other public organizations offering lower prices. The company also substituted higher priced products for the city of Los Angeles and the other plaintiffs, did not provide available manufacturer rebates, and raised product prices more than twice each year.
In response to the settlement agreement, the City Attorney for Los Angeles expressed gratitude for the much needed city funds and hopes that this case may encourage others to take action if they are aware that government organizations are being shortchanged.
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