Agility settles with U.S. government in food-supply overbilling dispute

Kuwaiti logistics firm Agility Logistics has settled with the U.S. government over alleged billing overcharges on multi-billion dollar food supply contracts with the Defense Department from 2003 to 2010.

Under terms of the civil settlement, Agility said it will make a $95 million cash payment. In the criminal portion of the case, Agility pled to a misdemeanor relating to one invoice valued at $551. The criminal settlement calls for Agility to pay $551, but carries with it no criminal charges, the company said.

The contracts covered nearly 200,000 invoices to the U.S. government, valued at $8.6 billion. The terms of the settlement are subject to final court approval.

The settlement allows Agility to resume its bidding on new U.S. government contracts, the company said. The U.S. government will remove Agility and all of its subsidiaries and affiliates from the list of suspended companies on its "System for Award Management" (SAM) database within 60 days, Agility said.

"Today's settlement removes uncertainty for investors and lenders, ends costly litigation, and opens a pipeline of potential government and commercial contracting opportunities," said Agility CEO Tarek Sultan in a statement.

Agility had been unable to bid on an undetermined number of commercial contracts because prospective customers were prevented from doing business with a company involved in a lawsuit with or against the U.S. government, according to a person familiar with the situation.