Eric J. Caddy, 62, of Huntington, Texas, admitted to submitting collusive bids for multiple healthcare projects at Moody Air Force Base in Georgia, including a medical logistics warehouse, pharmacy modernization, veterinary clinic, and dental lab clinic projects. According to court filings, a co-conspirator instructed Caddy to submit artificially inflated prices and even provided specific pricing for the bids, which totaled over $1.6 million and were funded through the Defense Logistics Agency's Facilities Maintenance, Repair, and Operations Program.
The Justice Department's Antitrust Division alleged that Caddy and his co-conspirators deliberately corrupted the competitive bidding process for essential military healthcare infrastructure. "Bid rigging harms taxpayers, honest contractors and all of us who play by the rules, and will not tolerated," said U.S. Attorney William R. "Will" Keyes for the Middle District of Georgia. The conspirators concealed their scheme by having Caddy rewrite certain bid forms in his own handwriting before transmitting them to government contractors.
Caddy faces a maximum penalty of 10 years in prison and a $1 million fine for the Sherman Act conspiracy charge, plus an additional five years and $250,000 fine for conspiracy to defraud the United States. Fines could be increased to twice any gains or losses if those amounts exceed statutory maximums. Caddy is scheduled for sentencing on June 25, when a federal judge will consider sentencing guidelines and other factors.
The guilty plea represents the first conviction in what the Justice Department describes as an ongoing investigation into bid rigging and fraud affecting U.S. military facilities nationwide. The case was investigated by the Justice Department's Procurement Collusion Strike Force, a joint law enforcement initiative launched to combat anticompetitive conduct in government contracting at federal, state, and local levels.
"Defending free and fair competition in healthcare spending is a critical priority for the Antitrust Division, particularly when it affects the U.S. military," said Acting Deputy Assistant Attorney General Daniel Glad. "The Antitrust Division's Procurement Collusion Strike Force and its partners will continue to find and prosecute those who corrupt the competitive process and increase healthcare-related costs in the United States."
The investigation involved coordination between multiple agencies including the Air Force Office of Special Investigations, Defense Criminal Investigative Service, and Defense Logistics Agency Office of Inspector General. Special Agent-in-Charge Jason Sargenski of DCIS called bid rigging involving military healthcare contracts "a direct betrayal of the service members and their families who rely on these facilities."
The case underscores the Justice Department's focus on protecting competition in defense contracting, particularly for healthcare-related services that directly impact military readiness. The Procurement Collusion Strike Force offers whistleblower rewards ranging from 15 to 30 percent of recoveries exceeding $1 million for information leading to successful prosecutions of antitrust violations in government contracting.