Tetra Tech: US Government Secures $57 Million Settlement for Environmental Fraud

• A federal judge approved a $57 million settlement resolving environmental fraud claims against Tetra Tech EC.
• The settlement resolves four causes of action under the False Claims Act, including common law fraud and CERCLA claims.
• Relators who filed the qui tam actions will receive a 21% share of the settlement proceeds.
• Tetra Tech EC agreed to pay $57 million plus interest to resolve the claims, with $51.87 million allocated towards 'Soil Fraud Allegations' and $5.13 million towards 'Building Scan Fraud Allegations'.
• The government separately reached a $40 million settlement agreement with Tetra Tech EC in July 2025 to resolve the CERCLA claim.

This egregious behavior not only compromised public health but also undermined the integrity of the redevelopment project at Hunters Point.

The settlement marks a significant milestone in the ongoing effort to hold contractors accountable for environmental fraud and deception. At its core, this case highlights the importance of accurate remediation efforts at contaminated sites like Hunters Point Naval Shipyard. The $57 million payout is a direct result of the government's intervention in the qui tam action filed by four whistleblowers, who initially accused Tetra Tech EC of falsifying soil tests to conceal radiation contamination. This egregious behavior not only compromised public health but also undermined the integrity of the redevelopment project at Hunters Point. As Assistant Attorney General Joseph Hunt noted in 2018, 'The Department of Justice will vigorously pursue action against those who obtain federal funds based on promises they knowingly fail to keep.' The settlement's terms allocate $51.87 million towards the 'Soil Fraud Allegations' and $5.13 million towards the 'Building Scan Fraud Allegations,' underscoring the severity of Tetra Tech EC's misconduct.

The settlement resolves four causes of action under the False Claims Act, including claims of common law fraud and recovery of response costs under CERCLA. The government intervened in the case in 2018, taking over primary prosecutorial duties from the relators who initially filed the qui tam actions in March 2013. The parties announced a settlement-in-principle in December 2024, with Tetra Tech EC agreeing to pay $57 million plus interest to resolve the claims. However, the government separately reached a $40 million settlement agreement with Tetra Tech EC in July 2025 to resolve the CERCLA claim, sparking controversy over the relators' share of the proceeds.

The $57 million settlement serves as a stark reminder of the consequences of environmental fraud and deception. As lawyers and compliance officers, it is essential to note that this precedent may impact future cases involving environmental claims under the False Claims Act and CERCLA. The significant percentage allocated to the relators (21%) highlights the importance of effective whistleblower programs in uncovering corporate misconduct. This settlement underscores the critical role that whistleblowers play in holding contractors accountable for their actions, and it serves as a warning to companies engaging in similar practices.

Lawyers should be aware of the precedent set by this $57 million settlement, which may impact future cases involving environmental fraud claims under the False Claims Act and CERCLA. Compliance officers should also note that relators can receive a significant percentage of the settlement proceeds, highlighting the importance of effective whistleblower programs.

Source: Original reporting via Courthouse News