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Cintas Overcharging of Governments and Nonprofits Class Action

Cintas Corporation No. 2 has contracts with the government to rent things like uniforms, mats, mops, and towels to government and nonprofit organizations around the country at a single, consistent price. However, the complaint for this class action alleges that the company overcharges both its government and its nonprofit customers.

The class for this action is all US Communities or Omnia Partners Public Sector PPAs that have entered into contracts with Cintas for the rental or lease of products that piggyback on the 2012 and/or 2018 Master Agreements.

Cintas has two contracts with the government, estimated to earn it $100 million and $250 million respectively. It enters into these contracts with an entity formerly called the US Communities Government Purchasing Alliance, more recently known as Omnia Partners, Public Sector.

Entities like states, counties, school districts, technical or vocational schools, and higher educational institutions may register with US Communities as a Participating Public Agency (PPA). The organization then uses the collective buying power of these entities to get goods or services at lower prices than they could get individually.

US Communities chooses an organization as a Lead Public Agency, which issues a Request for Proposals (RFP) to turn into a Master Agreement and then negotiates an Administration Agreement with a vendor. The other agencies may “piggyback” onto these agreements to obtain their own goods or services in the same field.

The Administration Agreement has a number of provisions that, for example, require the vendor to offer the prices in the Master Agreement to other PPAs. Another provision is the ability to conduct random audits at its own expense and, if irregularities are found, to conduct an “extensive audit” at the supplier’s expense.

The complaint reviews two Master Agreements, a 2012 one with Harford County Public Schools (HCPS) and a 2018 one with Prince William County Public Schools (PWCS), both with Cintas, onto which PPAs were permitted to piggyback. The plaintiff in this case is a PPA, the City of Laurel, Mississippi.

However, the complaint alleges, “During the nearly nine years that the Master Agreements have been in effect, Cintas has continually and systematically overcharged PPAs for the goods and services obtained under piggyback agreements by billing PPAs more than the prices set out in the Master Agreements.”

It also makes a second allegation: “Through its misconduct, Cintas has effectively stolen more than $16 million annually from the coffers of public agencies and nonprofits.” The complaint claims, “Cintas had charged the City 16.6% more than the prices” agreed to in the Master Agreements.

The complaint claims, “By willfully breaching its contractual obligations, Cintas bilked tens of millions of dollars from governments and nonprofits and so prevented them from using that money to serve the public.”

Article Type: Lawsuit
Topic: Accounting and Charges

Most Recent Case Event

Cintas Overcharging of Governments and Nonprofits Complaint

March 12, 2021

Cintas Corporation No. 2 has contracts with the government to rent things like uniforms, mats, mops, and towels to government and nonprofit organizations around the country at a single, consistent price. However, the complaint for this class action alleges that the company overcharges both its government and its nonprofit customers.

Cintas Overcharging of Governments and Nonprofits Complaint

Case Event History

Cintas Overcharging of Governments and Nonprofits Complaint

March 12, 2021

Cintas Corporation No. 2 has contracts with the government to rent things like uniforms, mats, mops, and towels to government and nonprofit organizations around the country at a single, consistent price. However, the complaint for this class action alleges that the company overcharges both its government and its nonprofit customers.

Cintas Overcharging of Governments and Nonprofits Complaint
Tags: Additional charges in breach of contract, Breach of Contract, Charges in Excess of What Was Promised