OtterBox reaches settlement in whistleblower lawsuit

FORT COLLINS – OtterBox has reached a settlement with a former employee who filed a whistleblower lawsuit alleging the cell-phone case maker underpaid federal import taxes on products it made in China.

Fort Collins-based Otter Products LLC, which sells OtterBox, the No. 1-selling smartphone case in North America, reached a settlement in the lawsuit filed by Bonnie M. Jimenez of Brighton, according to a court filing made last week. OtterBox and Jimenez are awaiting approval of the agreement by the U.S. government, according to the filing in U.S. District Court in Denver.

“OtterBox and (Jimenez) have agreed to a set of settlement terms and those terms have been submitted in writing to the appropriate government officials for approval,” reads the court filing. “The parties await final approval of the settlement terms, but are informed by government counsel that progress has been made in the approval process.”

The settlement terms were not disclosed.

OtterBox and Jimenez reported the status of the case to a judge in the Jan. 30 court filing. A spokeswoman for OtterBox said the settlement was pending so the company had no comment. An attorney for Jimenez did not immediately return a phone message.

Jimenez, who worked in customs compliance as OtterBox’s supply-chain director, contended the company failed to pay customs duties on the full value of its cell-phone cases, violating the False Claims Act. Jimenez sued OtterBox in 2011.

On Jan. 2, OtterBox and Jimenez asked for a suspension of court proceedings so they could negotiate a settlement to “resolve this action once and for all.” Authorities of the U.S. Department of Homeland Security, U.S. Department of Justice and the U.S. Attorney’s Office must approve any deal.

A spokesman for U.S. Attorney John Walsh declined to comment.

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