Opinion ID: 2755031
Heading Depth: 2
Heading Rank: 2

Heading: The CT/MRI Contract

Text: The VA solicited bids for CT/MRI equipment and SMS submitted a response in April 2002. SMS submitted separate Discount and Pricing Information forms for the CT and MRI equipment in which it – unlike Acuson – identified the discounts offered only to customers with contracts comparable to the VA contract. SMS thus disclosed maximum discounts of 32% for CT equipment and 35% for MRI equipment, stating that it offered further discounts if certain minimum orders were satisfied. SMS then went on to offer those same discounts to the VA. Before SMS submitted the Discount and Pricing Information forms, the VA notified it that SMS would be subject to an Inspector General audit. The audit revealed that SMS was offering larger discounts to commercial customers than it had offered to the VA.4 Based on that information, the VA negotiated further upgrades to the equipment, but ultimately accepted the discounts of 32% and 35% respectively, even though it knew that SMS offered greater discounts to other customers. 4 The District Court concluded that the pricing offered to commercial customers was distinguishable from that offered to the VA because those contracts were part of a group purchase and were structured differently than the government contracts or referred to items which were not offered as part of the CME needed by the VA. Siemens AG, 991 F. Supp. 2d at 585-88. 4