Raytheon’s $950 Million Settlement: A Big Win for Whistleblowers and Accountability

Thanks in part to the efforts of whistleblower law firm Brown, LLC, Raytheon, a subsidiary of RTX, agreed to pay $950 million in October 2024 to settle several government investigations into fraudulent pricing, foreign bribery, and export control violations. This massive settlement speaks to both the seriousness of the misconduct and the critical role that whistleblowers play in holding corporations accountable. It also solidifies Brown, LLC’s reputation as one of the nation’s top firms for whistleblower litigation, standing up for the courageous insiders who bring these violations to light and helping protect public funds.

Overview of the Raytheon Case and Alleged Violations

The heart of the case involves fraudulent pricing practices and foreign bribery. Between 2011 and 2017, Raytheon allegedly inflated costs on contracts with the Department of Defense (DOD), causing the government to overpay by $111 million for Patriot missile systems and radar services. These actions allegedly constituted violations of the Truth in Negotiations Act (TINA), which requires companies to provide accurate cost data on non-competitive government contracts to prevent price gouging.

TINA is especially important in the defense sector, where no-bid contracts are common. When the government relies on one company to deliver critical military products, there is no competitive bidding at times. Companies must report actual costs and are permitted to build in a profit margin. But when companies inflate those costs, the extra profit comes straight out of taxpayer pockets. Also what often occurs in defense contracting cases is a tactic known as a cross-charging scheme—where companies spread costs across multiple contracts—however, it wasn’t directly involved in this case.

In addition to the pricing violations, Raytheon employees allegedly engaged in foreign bribery. From 2012 to 2016, employees paid bribes to a high-ranking official in Qatar’s Emiri Air Force to secure lucrative defense contracts, bypassing competitive bidding. These payments, disguised through sham subcontract arrangements, violated the Foreign Corrupt Practices Act (FCPA). The bribery violations add another layer to the case, highlighting how allegedly unethical practices can undermine both competition and trust in international business dealings.

The Role of Brown, LLC and the Whistleblower

The whistleblower, a former Raytheon employee, was represented by Brown, LLC, led by Jason T. Brown. Their work was instrumental in exposing these violations and ensuring that Raytheon was held accountable. Whistleblowers like this one are essential to uncovering corporate misconduct, particularly in industries like defense contracting, where wrongdoing can remain hidden for years without insider action.

For her bravery in coming forward, the whistleblower will receive a multi-million dollar False Claims Act whistleblower reward; a share of the settlement under the False Claims Act (FCA). Jason T. Brown emphasized that public-private cooperation—with whistleblowers, law firms, and government agencies working together—is crucial for holding corporations accountable. Brown noted that substantial FCA settlements are often followed by Notices of Covered Action (NOCA) through the SEC whistleblower program, signaling there may be further penalties for related misconduct.

Penalties and Compliance Measures

The settlement includes several penalties:

• $428 million for violations of the FCA related to fraudulent pricing.
• $252 million in criminal fines for the bribery scheme.
• $147 million in restitution and penalties for export control violations.

Raytheon also agreed to deferred prosecution agreements (DPAs), requiring the company to:

1. Retain an independent compliance monitor for three years.
2. Implement stronger anti-corruption policies and internal controls.
3. Report any additional violations to the DOJ and SEC during the monitoring period.

In addition, the company will forfeit $36.7 million. These DPAs reflect heightened scrutiny by the DOJ and SEC of defense contractors and send a clear message: corporate misconduct—whether through fraudulent pricing or bribery—will have significant legal consequences.

Broader Implications and Public-Private Cooperation

This case illustrates the growing trend of public-private cooperation under the False Claims Act (FCA), where whistleblowers work with private law firms and government agencies to expose fraud. The DOJ Anti-Corruption Task Force and SEC FCPA Unit played key roles in investigating Raytheon. RTX, aware of the seriousness of the charges, had already set aside $1.24 billion earlier in 2024 to cover potential settlements, signaling the impact of these investigations on the company’s operations.

The Raytheon settlement serves as a warning to other contractors: defrauding the government is not just bad business—it’s illegal and will be punished. Defense contractors, in particular, must meet the highest standards of compliance to avoid damaging both their reputation and national security interests.

The FCA remains one of the most powerful tools for fighting corporate fraud, giving insiders the ability to report wrongdoing confidentially and receive a portion of the recovery. As Jason T. Brown emphasized, whistleblowers are crucial to exposing fraud and protecting taxpayer dollars, particularly in industries with limited oversight.

Brown, LLC: Leading the Charge in Whistleblower Advocacy

This $950 million settlement demonstrates the importance of robust compliance programs and ethical corporate behavior. It also highlights how whistleblowers—when supported by experienced law firms like Brown, LLC—can drive significant change. For anyone with information about misconduct, partnering with a knowledgeable whistleblower firm ensures that their rights are protected, and their efforts can make a real impact.

Brown, LLC has built a reputation for successfully representing whistleblowers and helping the government recover misappropriated funds. The firm’s track record, coupled with a deep understanding of the FCA and FCPA and several DOJ alumni, allows them to navigate complex FCA and SEC whistleblower cases like this one effectively.

As enforcement efforts increase, firms like Brown, LLC are positioned at the forefront of these actions, ensuring that insiders who expose fraud are not only protected but may also be rewarded for their bravery.

Brown, LLC a Leading False Claims Act Law Firm Instrumental in the RTX False Claims Act Settlement

The Raytheon case is an expensive reminder that corporate misconduct, whether through fraudulent pricing, bribery, or other unethical practices—will not go unchecked when good people step forward and do the right thing. Thanks to the courage of the whistleblower and the diligent work of Brown, LLC, the government was able to recover millions and hopefully deter other corporations from illegal wrongdoings. Further, as contemplated the multi-million dollar False Claims Act whistleblower award serves as an incentive for other insiders to step forward and disclose inside information about overbilling the government in the right way.

With public-private cooperation under the FCA continuing to grow, whistleblowers can take comfort in knowing that they have the support of firms like Brown, LLC. As Jason T. Brown put it: “Compliance is not optional, and those who step forward to expose wrongdoing will always have a path to justice.”