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Wednesday May 6th, 2015 10:44PM

Whistle-blower lawsuit in Navy kickbacks continues

By The Associated Press
PROVIDENCE, R.I. (AP) -- A whistle-blower lawsuit that alerted authorities to a multimillion-dollar kickback scheme targeting the U.S. Navy is restarting in federal court in Rhode Island now that the criminal case has concluded.

Lawyers for a Georgia couple who first sued in 2006 filed papers on Friday to continue the lawsuit, which seeks up to $54 million. The lawsuit had been put on hold during the criminal investigation and prosecution, which wrapped up last month.

Six people ultimately pleaded guilty in connection with the scheme, in which a Navy employee would approve payments to contractors who would funnel money back to him and others. The lawsuit was first filed under seal in a federal court in Georgia and later was transferred to Rhode Island.

Federal prosecutors say the ringleader was Ralph M. Mariano, who worked for the Naval Undersea Warfare Center in Newport, R.I., and was most recently based at the Washington Navy Yard. The others convicted included Anjan Dutta-Gupta, founder of the now-defunct Georgia-based Navy contractor Advanced Solutions for Tomorrow, former ASFT executive Patrick Barry Nagle and Russell Spencer, a subcontractor from Rhode Island.

Mariano is now serving a 10-year prison term, although he is appealing his sentence and conviction. Dutta-Gupta and Spencer each were sentenced to three years in prison and Nagle received three years of probation. They have all been ordered to repay the Navy $18 million restitution. Mariano's father and girlfriend, who was an ASFT executive, are serving home confinement.

The lawsuit was brought by Rekha and Karan Vasudeva, of Roswell, Ga., under the federal False Claims Act, which allows private citizens to sue on the government's behalf. The Vasudevas have said they were involved in setting up a company that was used to issue fictitious invoices to ASFT and a company owned by Spencer.

The law allows for the government to receive triple damages, in this case $54 million. The Vasudevas would be entitled to a portion of that money - although whether they could ever collect is an open question given that many of the defendants have few assets remaining.

In a separate court filing on Friday, lawyers for the Vasudevas and the U.S. attorney's office in Providence informed the court that they had agreed to settle with Nagle for undisclosed terms. Shelley Slade, the Vasudevas' lawyer, would not comment, and a spokesman for the U.S. attorney's office said he did not immediately know the terms of the settlement. Nagle's lawyer did not return a message for comment over the holiday weekend.

The remaining defendants in the lawsuit are Mariano, Spencer, Dutta-Gupta and his wife and daughter. Mariano is representing himself. Lawyers for Spencer and Dutta-Gupta did not return messages seeking comment.
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