Defense contractor pays $1.15M to settle theft claim


Defense contractor Paragon Dynamics Inc. has agreed to pay $1.15 million to settle allegations that it improperly obtained bid and proposal information for National Reconnaissance Office contracts, federal prosecutors announced Tuesday.

Paragon Dynamics, a software research and development firm based in Aurora, Colo.,  allegedly obtained bid and proposal information from competitor Raytheon Corp. in fiscal 2009, while Raytheon was competing on National Reconnaissance Office contracts, the U.S. Attorney for the District of Colorado said in the news release. The NRO is in charge of designing, launching and maintaining America’s intelligence satellites.

A Paragon Dynamics employee with access to a Raytheon facility in Aurora allegedly used his access to obtain entire drafts of Raytheon’s proposals for two separate contracts, according to information from the Colorado U.S. Attorney’s office.  The  employee allegedly faxed part of a proposal to the president of Paragon Dynamics, who sent the information to another corporation that Paragon Dynamics was teaming with in a competition to win the NRO contract, according to the government’s claims.

“When companies cheat in the bidding process for government contracts by stealing the work of their competitors, they face strict penalties,” said John Walsh, U.S. Attorney for the District of Colorado. “Corporate espionage erodes the trust we have in our public procurement system, and the Department of Justice will hold cheaters accountable for their actions.”

As part of the agreement, NRO’s inspector general reached a corporate integrity agreement with Paragon Dynamics, according to the news release. Paragon Dynamics was awarded $3 million in defense contracts in 2012, according to data from the Federal Procurement Data System.


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