ILC Dover LP and ILC Astrospace LLC of Frederica, Delaware, agreed to pay $13 million to settle allegations that they violated the False Claims Act, the Justice Department said November 3. The government alleged the defense and aerospace companies failed to comply with cybersecurity requirements in their contracts with the Army, the Missile Defense Agency and NASA.
The settlement covers claims for payment the companies submitted from January 2018 to October 2024, according to the Justice Department. The government alleged those claims were false because ILC knew it had not met the cybersecurity terms of its contracts.
The Justice Department laid out three lapses. From February 2023 to October 2024, ILC allegedly used a third-party company to store controlled unclassified information in the cloud without making sure the third party met security requirements equal to the FedRAMP Moderate baseline and Defense Department rules on cyber incident reporting, malicious software and forensic access. From January 2018 to March 2022, and again from September 2022 to October 2024, ILC allegedly did not develop, document and update a system security plan for each covered information system as its Defense Department and NASA contracts required.
From November 2020 to October 2024, ILC Astrospace allegedly never submitted a current assessment of its NIST SP 800-171 cybersecurity controls to the Defense Department, and ILC Dover allegedly had not submitted an assessment that was current and done under the department's methodology, the Justice Department said. The department said contractors must honor the cybersecurity terms of their federal contracts to protect sensitive information from cyber threats, and that it will keep holding contractors accountable when they fall short.
The case began as a lawsuit under the whistleblower provisions of the False Claims Act, which let private parties sue on the government's behalf and share in any recovery. The whistleblower, Philip Root, ILC's former Director of Cybersecurity, will receive a $2.35 million share of the settlement.
