SACRAMENTO, Calif. (AP) — A Sacramento-based defense contractor is paying $3.3 million to settle a lawsuit that claims it fraudulently overbilled federal defense agencies.

The U.S. Attorney for the Eastern District of California, Benjamin Wagner, said Wednesday that the firm Aerojet and its corporate parent GenCorp Inc. agreed to the settlement.

Officials said Aerojet charged defense agencies for business costs associated with the company’s resisting of a 2004 takeover bid by another company, Steel Partners Inc. Federal regulations do not allow such costs to be reimbursed by the government.

Ninety-two percent of Aerojet’s sales are federal government contracts.

The U.S. Attorney’s Office said Aerojet’s inclusion of these costs resulted in overpayments by the government to the company.

Wagner said the settlement will compensate the defense agencies and show his commitment to protecting taxpayers’ money.


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