Pure Collection Ltd. settles whistleblower allegations of
purposefully evading U.S. customs fees on American customers'
orders of luxury cashmere knitwear.
LONDON, Feb. 13, 2018 /PRNewswire/ -- Constantine
Cannon LLP is pleased to announce a more than $900,000 settlement on behalf of its
whistleblower client in a lawsuit against Pure Collection Ltd. Pure
Collection is a Harrogate,
England-based e-retailer of luxury cashmere and apparel
goods. The United States Government announced the settlement
agreement today with Pure Collection and the e-retailer's acting
CEO, Samantha Harrison. The company
and Ms. Harrison have collectively agreed to a settlement of
$908,100 (USD) to the U.S.
Government.
This lawsuit was one of the first to be brought by a U.K.
whistleblower in which the U.S. Government intervened and
successfully resolved the whistleblower's False Claims Act (FCA)
allegations. The whistleblower, Andrew
Patrick of Harrogate,
England, brought to Constantine
Cannon's London office
information regarding Pure Collection's practices. Mr. Patrick will
be awarded 18 percent of the total settlement.
The qui tam, or whistleblower, lawsuit alleged
that since 2007 the defendants fraudulently and systematically
avoided paying U.S. customs duties on its goods shipped from the
United Kingdom to customers in
the United States. In an attempt
to attract more U.S.-based customers, Pure Collection engaged in a
practice commonly known as "splitting." The defendants neither
admitted nor denied liability.
Whistleblower Andrew Patrick
worked for Pure Collection from 2010 to 2014, first as a sales
representative in its U.K. call center and then in its U.K.
packaging department. Mr. Patrick was trained to
systematically split customers' large orders to successfully avoid
paying U.S. customs fees, saving the company millions of dollars,
according to the suit.
Mr. Patrick brought his allegations to the attention of U.S.
Customs and Border Protection in 2014, and later filed a
whistleblower submission with the U.S. Internal Revenue Service in
2015. After the two initial unsuccessful attempts to alert U.S.
authorities, Mr. Patrick approached Richard
Pike, a solicitor-advocate and partner in Constantine Cannon's London office, who specializes in advising
whistleblowers under U.S. whistleblower programs. Mr. Patrick
filed his whistleblower suit in 2016 in federal court in
Maine.
Mr. Patrick is represented by Mary
Inman, Richard Pike and
Till Vere-Hodge in Constantine Cannon's London office. Dan Murphy of Bernstein
Shur, served as counsel in Maine,
where the case was filed. Mr. Patrick is also represented by
Molly Knobler of Phillips &
Cohen.
"Mr. Patrick is the first British whistleblower to expose a UK
company for evading U.S. import duties and only the second to
receive a financial reward under the whistleblower provisions of
the False Claims Act," said Inman, a partner in Constantine Cannon's London office whose practice focuses on
representing UK and EU whistleblowers under the American
whistleblower programs. "As global business expands, European
whistleblowers like Mr. Patrick play an increasingly vital role in
alerting the U.S. Government to fraud schemes that cross
international borders."
"Mr. Patrick should be commended for his persistence in bringing
these matters to the attention of multiple U.S. authorities and his
foresight in being among the handful of British citizens who have
availed themselves of the American whistleblower programs," said
Pike, a partner in Constantine
Cannon's London
office. "The American taxpayers owe Mr. Patrick a debt of
gratitude for his courage in coming forward to expose these
practices, many of which occurred on British soil but reverberated
in the U.S."
"Pure arrogantly decided it didn't need to play by the same
rules as other retailers, and placed its own interests in profits
and access to the U.S. market above the laws of the U.S.
Government," said Vere-Hodge, an associate in Constantine Cannon's London office. "The Government's successful
resolution of Mr. Patrick's case sends a clear message that this
behavior will not be tolerated."
The federal False Claims Act (FCA) encourages whistleblowers of
any nationality to expose companies that are defrauding the U.S.
Government by allowing a private party from any country to file a
civil lawsuit on the government's behalf and providing for a reward
of 15 to 25 percent of the Government's civil recovery if the
government joins, or intervenes in, the case, as the Government has
done here. Mr. Patrick will receive 18 percent of the
Government's recovery.
The FCA is one of the most effective weapons in combatting
fraud, waste, and abuse by those who contract with the U.S.
Government. Since 2017, the U.S. has recovered upwards of
$50 million in customs duties fraud
cases alone. Just last week, the Wall Street Journal observed
an increase in whistleblower cases exposing customs-related
wrongdoing. Such fraud can be difficult to uncover without
access to inside information; well-placed whistleblowers like Mr.
Patrick are necessary to provide the information to help stop these
practices.
Constantine Cannon would like to
recognize the fine lawyers in the U.S. Attorney's Office in the
District of Maine for their work
on the case, in particular, Civil Division Chief John G. Osborn and Assistant U.S. Attorney
Andrew K. Lizotte.
United States of
America ex rel. Andrew
Patrick v. Pure Collection Ltd. et al., Case No.
2:16-cv-00230-GZS, United States
District Court for the District of Maine.
About Constantine Cannon's Whistleblower
Practice:
Constantine
Cannon's team of dedicated whistleblower lawyers has
extensive experience representing whistleblowers in federal and
state courts and before the Securities & Exchange Commission,
the Internal Revenue Service, the Commodity Futures Trading
Commission, and the Department of Transportation. With a
total of 21 attorneys, who bring more than 100 years of collective
experience in whistleblower cases, working full-time representing
whistleblower clients, Constantine Cannon is one of the
largest and most expert whistleblower law firms
in the United States. Additionally, the
firm's London office allows for the unique ability to
serve whistleblower clients in Europe and Asia. The firm's expansion of its
American whistleblower practice to London, an international port-of-call for
whistleblowers worldwide, was featured recently in the New York Times. To learn more
about Constantine Cannon's whistleblower
practice, click here.
About Constantine Cannon LLP
Constantine Cannon, with offices in New
York, Washington, D.C., San
Francisco and London, has deep expertise in practice
areas that include antitrust and complex commercial litigation,
whistleblower representation, government relations, securities and
e-discovery. The firm's antitrust practice is among the largest and
most well recognized in the nation. Constantine
Cannon's experience spans across multiple industries including
healthcare, banking, electronic payments, insurance, high tech,
telecommunications, the Internet and government contracting. To
learn more about the firm generally, click here.
Media
Contact:
Attorney Contact:
Andrea M.
Garcia
Mary A. Inman
PRCG | Haggerty
LLC Constantine
Cannon LLP, London
+1 (212) 683-8100 (New
York) (0)75
2350 7532 (mobile)
Agarcia@prcg.com
minman@constantinecannon.co.uk