A revised settlement in a lawsuit between the District and Banneker Ventures preserves the city’s ability to sue against the contracting and construction business tied to two of former Mayor Adrian Fenty’s fraternity brothers. The modified settlement was filed earlier this month, and the D.C. Council voted Tuesday to stop trying to intervene in the suit.
The District agreed to pay Banneker $550,000 in a July settlement that prevented D.C. from reclaiming millions of dollars in payments and from suing the company for fraud. The settlement put an end to Banneker’s claim that the city owed it $2.3 million for a parks and recreation construction contract.
The revised settlement explicitly acknowledges that the District could file other claims against Banneker.
Settling the suit “does not extinguish or release the parties from the District of Columbia’s right to bring a false claims action or claim of civil fraud within applicable limitations periods should the District determine that there is evidence sufficient to support the filing of either claim,” the revised agreement says.
In a letter filed with the court, an attorney for Banneker maintains that “there is absolutely no evidence to support a fraud claim” against the company or Fenty fraternity brother Omar Karim, who ran the business.
In 2009, the council canceled the Banneker contract after it determined Fenty’s administration had circumvented a law requiring the council to vote on contracts that exceed $1 million.
The council contended that it was also circumvented in the settlement, and filed a motion to intervene in the case last November.
Council members said Tuesday that they were pleased the city kept its ability to sue Banneker if wrongdoings are uncovered, but said they were still frustrated they couldn’t fully reopen the agreement.
“It’s only a partial victory,” Councilwoman Mary Cheh said. Cheh also said she was “deeply disappointed” law enforcement wasn’t more aggressive in pursuing Banneker.
A yearlong probe into Banneker’s contracts with the city was released last month and cleared Fenty of wrongdoing. But Banneker has been accused of charging the city for markups in contracts for work the firm then subcontracted to others, allegations the probe supported.
The city still has no recourse against Banneker in cases of “padded billings” that don’t rise to the level of fraud, Councilman Phil Mendelson said.
“Our hands are tied,” he said.
