The government contractor SAIC Inc. (now Leidos Holdings Inc.) must still be reeling from the $500 million settlement it reached with the U.S. Department of Justice in 2012, which resolved allegations that its employees took kickbacks and engaged in overbilling while revamping New York City’s payroll system. But the company had plenty of reason to be pleased on Thursday, when Andrew Tulumello of Gibson, Dunn & Crutcher helped it win two major rulings in lingering investor litigation over the kickback scandal.
In a brief order, the U.S. Court of Appeals for the Second Circuit dismissed a shareholder derivative suit alleging that SAIC’s board failed to halt the corrupt payments. Affirming a prior ruling by U.S. District Judge J. Paul Oetken in Manhattan, the appeals court ruled that plaintiffs lawyers failed to meet their burden of showing that the board ignored “red flags” that SAIC employees were taking illegal kickbacks. Tulumello handled the oral argument for SAIC, squaring off against plaintiffs lawyer Brett Stecker of the Weiser Law Firm in Berwyn, Penn.
