Each month, energy companies are required to report to the Minerals Management Service (MMS) the value of natural gas produced from Indian and federal leases. They are to pay a percentage of these royalties to the United States. Chevron Companies repeatedly under-reported the value of natural gas they took off federal and Indian leases form March 1988 to November 2008. The underreported values resulted in Chevron paying less royalties than they owed to the United States and various Indian tribes. According to Interior Secretary Ken Salazar,

“This settlement successfully ends long-standing litigation and ensures that taxpayers receive their fair share of royalty revenues form energy production on federal and American Indian lands.”

Withholding money that is owed to the United States is known as a “reverse false claim” under the federal False Claims Act. Whistleblowers who report fraudulent reverse false claims may be entitled to as 25-30% of the recovery, depending upon their level of involvement in the case. Whistleblower, Harrold Wright brought this lawsuit under the qui tam whistleblower provision of the False Claims Act. Although deceased, Mr. Wright’s heirs will receive over $12 million plus interest, as a part of the settlement.

To report violations of the False Claims Act, contact Frohsin & Barger.