Bollinger Shipyards will pay the U.S. $8.5 million to settle a False Claims Act action filed against it over the ill-fated stretching of eight Coast Guard cutters. The U.S. alleged that the Lockport, La., company misrepresented the longitudinal strength of patrol boats it delivered to the Coast Guard that resulted in the boats buckling and failing once they were put into service.

The suit was filed in the Eastern District of Louisiana. The Department of Justice announced the settlement Wednesday afternoon.

In 2002, Bollinger was the subcontractor on work for the Coast Guard to lengthen the agency’s existing fleet of Island-class patrol boats (WPBs) from 110’ to 123’ and make other modifications. An essential element of the conversion was that the modified boats, originally built by Bollinger, have sufficient longitudinal strength to meet the performance requirements in the contract. The U.S. alleged that Bollinger provided the Coast Guard with engineering calculations that falsely represented the longitudinal strength of the boats that were two times greater than their actual longitudinal strength.

The U.S. alleged Bollinger ran the calculations three times and only provided the Coast Guard with the highest and most inaccurate of the three calculations. It was further alleged that Bollinger also failed to follow the quality control procedures that were mandated by the contract that would have ensured against such engineering miscalculations.

A statement from the DOJ noted that the claims resolved by the settlement are allegations only, and there has been no determination of liability.

The eight modified vessels were ultimately deemed unseaworthy and taken out of service in 2006.

“Those who expect to do business with the government must do so fairly and honestly,” said Principal Deputy Assistant Attorney General Benjamin Mizer, head of the Justice Department’s Civil Division. “We expect the utmost integrity and reliability from the contractors that design and build equipment that is essential to public safety and our national defense.”

The U.S. initially filed suit against Bollinger in 2011 seeking $38.6 million in non-contract damages, and the case has dragged on since. A favorable ruling for the shipyard was overturned in December 2014, paving the way for the government to resurrect its case.

The case was handled jointly by the Civil Division’s Commercial Litigation Branch and the U.S. Attorney’s Office of the Eastern District of Louisiana.

Read the full settlement agreement.