Nov 52026

DOJ and EEOC Announce $29.5 Million Two-Part Settlement with Lockheed Martin, the Fourth FCA Resolution Targeting Alleged Employment Discrimination

Kristin Graham Koehler, Jaime L.M. Jones, H. Boyd Greene IV, Kyle J. Fiet and Matt Bergs
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On November 3, 2026, the Department of Justice (“DOJ”) and the Equal Employment Opportunity Commission (“EEOC”) announced a two-part settlement with Lockheed Martin Corporation (“Lockheed”) totaling approximately $29.5 million. Lockheed will pay $22 million, plus interest, to the United States to resolve False Claims Act (“FCA”) allegations tied to its federal contract certifications. The FCA settlement also resolves a qui tam action filed in July 2025 in the Northern District of Texas by Tim Booher, a former Lockheed vice president. DOJ intervened in part on October 28, 2026, and Mr. Booher will receive $4.4 million. This is DOJ’s fourth FCA settlement resolving alleged employment discrimination (we covered the prior three here, here, and here). Lockheed will also pay approximately $7.5 million to more than 1,000 employees under a separate settlement agreement with the EEOC.

In the FCA settlement, DOJ alleges that from January 1, 2019 through the agreement’s effective date, Lockheed falsely certified compliance with the anti-discrimination requirements in its federal contracts, including Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on race, sex, and other protected characteristics, and Federal Acquisition Regulation clause 52.222-26, the equal opportunity clause. According to DOJ, those certifications were false because Lockheed knowingly engaged in three practices related to compensation, hiring and promotion, and development opportunities that allegedly discriminated on the basis of race or sex. DOJ also alleges that Lockheed sought payment under its federal contracts for costs related to those three practices.

  • Compensation. Beginning in 2021, Lockheed’s “Comp Adder” program gave the top 20% of employees in each business area a pay increase above the annual company-wide increase. DOJ alleges Lockheed ran a statistical analysis to flag outliers based on the race and sex composition of the Comp Adder list before finalizing it. HR was supposed to ask leaders to re-review their selections and the merit basis for them, without taking any protected characteristic into account. Instead, DOJ alleges, some HR personnel pressed leaders to resolve race-related flags by removing certain non-minority employees from the list and adding minority employees who had not originally been nominated.
  • Hiring and promotion. DOJ alleges Lockheed took race or sex into account to advance non-public, business-unit workforce composition goals. A Management Incentive Compensation Plan allegedly included a performance metric tied to demographic goals, and business units received quarterly color-coded summaries tracking goals for “women” and “minorities.” In 2023, Lockheed’s Global Diversity & Inclusion, and Equity & Compliance offices allegedly set additional company-wide “aspirational plus” hiring goals, which certain business units achieved for people of color.
  • Development opportunities. DOJ alleges Lockheed offered training, mentoring, and leadership development programs to eligible employees on the basis of race or sex, including an Executive Leadership Diversity Mentoring program designed to boost participants’ career prospects over others through sponsorship and networking.

Alongside the FCA settlement, Lockheed executed a separate agreement with the EEOC, which enforces Title VII directly. That agreement resolves a 2025 Commissioner’s Charge filed by EEOC Chair Andrea Lucas alleging race discrimination against white employees in performance assessments and in bonus and other compensation decisions, including through Comp Adder. Beyond monetary relief, Lockheed must comply with Title VII and Executive Order 14151 and maintain a merit-based workplace in which race and sex are not considered in hiring, compensation, bonus, or promotion decisions, and the EEOC may review compliance during the agreement’s term. DOJ describes the EEOC settlement as involving the “largest class of workers to publicly recover under an EEOC settlement on account of alleged Title VII violations arising from or relating to a DEI program or practices.”

A copy of the settlement agreement can be found here.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.

Contacts
Kristin Graham Koehler

Washington, D.C.

kkoehler@sidley.com

Jaime L.M. Jones

Chicago

jaime.jones@sidley.com

H. Boyd Greene IV

Washington, D.C.

bgreene@sidley.com

Kyle J. Fiet

Washington, D.C.

kfiet@sidley.com

Matt Bergs

Chicago

mbergs@sidley.com

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