Adobe Inc. to Pay $3 Million Settlement to Resolve Kickback Allegations

Adobe Inc. has agreed to pay $3 million to resolve False Claims Act allegations of making improper payments to companies in order to influence the sale of Adobe software to the federal government. According to the settlement, between January 2011 and December 2020, Adobe allegedly paid a percentage of the purchase price of the software to companies with a contractual or other relationship with the government, a direct violation of the Anti-Kickback Statute. To break down the alleged violation, the kickback appears to manifest as a rebate in which under the company’s “Solution Partner” program the third parties who sold the product to the government, were then given an additional premium as bump in compensation based on the percentage of sales, which was construed as a direct kickback.

U.S. Attorney Matthew M. Graves for the District of Columbia stated, “A fair market relies heavily on an even playing field… [W]hen a company, vendor, or business owner tips the scales to their advantage, it undermines the system. When government dollars are involved, it means taxpayers ultimately bear the burden. Whistleblowers – like those in this case – are to be commended for trying to return the playing field to level.” The three relators that brought forward the claims in this case were all former Adobe managers and are entitled to receive $555,000 in whistleblower rewards.

This whistleblower settlement serves as a reminder that the Anti-Kickback Statute of the False Claims Act is a very vibrant portion of enforcement and inducements that cloud judgment or create the appearance of an impropriety are actionable under the False Claims Act.