Federal judge allows whistleblower suit to proceed against military trucking firm

jmonk@thestate.comFebruary 25, 2014 

COVAN moving company logo

— A federal judge Tuesday let a federal whistleblower lawsuit proceed against a giant trucking company that ships the belongings of military personnel around the world. The suit alleges civil fraud and seeks millions in fines.

Trial will be during the March-April 2015 term of federal court in Columbia, Judge Joe Anderson said in an order.

In a hearing Tuesday, Anderson dismissed that part of the whistleblower suit that alleges that Covan World-Wide Moving engaged “in a intracorporate conspiracy.” He said there wasn’t enough evidence to go ahead with the government’s claims that Covan used affiliated companies to help it carry out such a broad conspiracy.

But the judge let stand five other counts of the lawsuit, which alleges that Covan and its affiliate, Coleman-American Moving Services, for years “systematically falsified weight certificates, shipping records and invoices by increasing shipment weights,” the lawsuit said.

The alleged fraud first was discovered at an Augusta truck shipping depot that receives and ships Fort Jackson soldiers’ belongings, according to the lawsuit and related government filings in the case. The government alleged that similar Covan frauds took place at its depots around the world.

Covan denies the allegations.

A lawyer for Covan, Jim Wyrsch of Kansas City, Mo., had urged Anderson to limit the government’s discovery time to just four months. “We want a quick trial,” Wyrsch said. He was assisted by defense lawyer Greg Harris of Columbia.

But U.S. Attorney Bill Nettles, who was personally arguing the case, told Anderson, “We believe we need nine months” to investigate and do discovery.

In the end, Anderson gave the government until Nov. 24 to finish discovery.

Since 2009, Covan and its affiliates have collected $723 million in government money for shipping military belongings.

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