Alabama Defense Contractor Agrees to $507K Settlement Over Cybersecurity Allegations

Huntsville-based defense contractor LOGZONE Inc. has agreed to pay $507,144 to resolve allegations that it failed to comply with cybersecurity requirements in contracts with the U.S. Department of the Navy, according to the U.S. Department of Justice.

The settlement resolves claims brought under the False Claims Act alleging that LOGZONE knowingly submitted claims for payment while not meeting certain cybersecurity standards required under two Navy contracts.

Federal officials alleged that between May 2021 and March 2025, LOGZONE did not implement specific cybersecurity controls outlined in National Institute of Standards and Technology (NIST) Special Publication 800-171. The standards are designed to protect sensitive defense information handled by government contractors.

According to the Justice Department, the deficiencies were identified during an assessment conducted by the Defense Contract Management Agency (DCMA). The evaluation resulted in LOGZONE receiving a score of -170 on a scale ranging from -203 to 110, indicating significant gaps in compliance with required security controls.

The government alleged that the missing cybersecurity measures could have increased the risk of unauthorized access to sensitive information or the exploitation of company systems.

The settlement does not include a determination of liability. As part of the agreement, LOGZONE will pay $507,144 to resolve the allegations.

Federal officials said the enforcement action reflects ongoing efforts to ensure government contractors comply with cybersecurity obligations tied to federal contracts, particularly those involving sensitive defense information.

The investigation and settlement involved the Justice Department’s Civil Division, the U.S. Attorney’s Office for the Northern District of Alabama, the Department of the Navy, the Defense Contract Management Agency, the Naval Criminal Investigative Service, and the Department of the Army Criminal Investigation Division.

Additional details regarding corrective actions taken by the company were not immediately available.