Dow Chemical Co. has agreed to pay nearly $457,000 in a federal case stemming from alleged misrepresentations by a former subsidiary about enamel paint products used on road construction projects across Minnesota.
Dow to pay $457K to settle fraud lawsuit regarding Minnesota highway work by former subsidiary
Former subsidiary Poly-Carb charged with faking test results.
September 5, 2023 at 4:11PM
Poly-Carb Inc. provided enamel paint for numerous road construction projects throughout Minnesota from 2012 to 2015, when it was still owned by Dow Chemical. Investigators charged Poly-Carb with "fabricating test results and forging signatures and documentation for its enamel products" to meet contract specifications.
The allegations are violations of both the federal False Claims Act and the Minnesota False Claims Act. Many of the projects, which were administered by the Minnesota Department of Transportation, were federally funded.
"In coordination with our state partners, we will continue using the False Claims Act to address fraudulent conduct by government contractors, subcontractors, and suppliers," Andrew Luger, U.S. Attorney for Minnesota, said in a statement.
A representative of Dow Chemical could not immediately be reached for comment.
The Office of Inspector General of the U.S. Department of Transportation and MnDOT jointly investigated the case.
In another case, MnDOT in 2018 said it had to scrape away a thin layer of asphalt and aggregate that was coming loose on the Mendota Bridge. The problem was an epoxy chip seal put down by Poly-Carb in 2011 was flaking off the bridge.
Michigan-based holding company Dow Inc. is a Fortune 500 company that reported sales of $56.9 billion in 2022. Dow — before its merger with DuPont and subsequent spinoff — sold Poly-Carb to Missouri-based Olin Corp. in 2015.
Dow previously paid $479,000 in 2018 to settle similar allegations against Poly-Carb in South Carolina.
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