Justia U.S. D.C. Circuit Court of Appeals Opinion Summaries

Articles Posted in Government Contracts
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Relator filed a qui tam action under the False Claims Act, 31 U.S.C. 3729-3733, contending that Record Press had submitted a fraudulent bill for printing services to the government. The district court granted judgment for Record Press. The court affirmed the district court's conclusion because there was no evidence that Record Press had submitted any false claims with knowledge it was doing so, as would be required for liability under the Act. In this case, the district court properly considered testimony and evidence indicating that the government agreed with Record Press about the disputed contract rate. Further, the district court did not consider the government’s understanding of the contract as part of any defense. Rather, it relied on the government’s agreement with Record Press about the proper understanding of the contract as evidence that there had been no fraudulent behavior in the first place. The court remanded for further proceedings on Record Press’s motion for attorneys’ fees because the district court did not make the findings necessary to enable the court to review its grounds for denying a fee award. View "United States v. Record Press, Inc." on Justia Law

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After the United States prevailed in a civil action brought pursuant to the False Claims Act (FCA), 31 U.S.C. 3729, based on certifications by MWI to the Bank to secure loans financing MWI's sale of water pumps to Nigeria, a jury awarded the government $7.5 million in damages. The damages were trebled to $22.5 million pursuant to the FCA. Because an FCA defendant is entitled to an offset from the trebled damages by any amount paid to compensate the government for the harm caused by the false claims, and the district court considered Nigeria’s repayment of the loan to be compensatory, MWI’s damages were reduced from $22.5 million to $0. The district court did impose civil penalties at the highest level. The government appealed and MWI cross-appealed. The court reversed the judgment because the government failed to establish that MWI knowingly made a false claim. Absent evidence that the Bank, or other government entity, had officially warned MWI away from its otherwise facially reasonable interpretation of an undefined and ambiguous term, the FCA’s objective knowledge standard, as the Supreme Court clarified while this litigation was pending in Safeco Insurance Co. of America v. Burr, did not permit a jury to find that MWI “knowingly” made a false claim. View "United States ex rel. Purcell v. MWI Corp." on Justia Law

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Upon remand of relator's qui tam suit, the district court ruled that the District violated the False Claims Act (FCA), 31 U.S.C. 3729(a), when it submitted a Medicaid reimbursement claim for FY 1998 and imposed the maximum penalty of $11,000. Both parties appealed. The court reversed and remanded, concluding that the relevant federal regulations, which were incorporated into the District’s Medicaid State Plan, required the District to maintain records supporting its Medicaid reimbursement claims that could be produced for audit. Pursuant to contractual obligations, relator’s firm was to prepare the FY 1998 interim Medicaid claims and year-end cost report, and consequently his firm, not the District, had physical possession of the underlying documentation supporting the District’s claim. Given this arrangement, the District reasonably understood when it submitted the claim for payment that it could, through the firm, make the supporting records available for audit. View "United States ex. rel. Davis v. District of Columbia" on Justia Law

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Relator filed a qui tam suit against AT&T and nineteen of its subsidiaries. At issue is whether an earlier and still pending qui tam lawsuit filed against a single AT&T subsidiary bars this suit under the False Claims Act’s first-to-file rule, 31 U.S.C. § 3730(b)(5), which prohibits qui tam actions that rely on the same material fraudulent actions alleged in another pending lawsuit. The court held that the first-to-file bar does not apply because the Wisconsin action alleges fraud based on affirmative pricing misrepresentations by seemingly rogue Wisconsin Bell employees. The present complaint, by contrast, alleges fraud and its concealment arising from a centralized and nationwide corporate policy of failing to enforce known statutory pricing requirements. In the alternative, the complaint does not fail to plead the alleged fraud with sufficient particularity under Federal Rule of Civil Procedure 9(b) where the complaint lays out in detail the nature of the fraudulent scheme, the specific governmental program at issue, the specific forms on which misrepresentations were submitted or implicitly conveyed, the particular falsity in the submission’s content, its materiality, the means by which the company concealed the fraud, and the timeframe in which the false submissions occurred. Accordingly, the court reversed the district court's judgment and remanded for further proceedings. View "USA ex rel. Todd Heath v. AT&T, Inc." on Justia Law

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The Medicare program provides federally funded healthcare to the elderly and the disabled. See Title XVIII of the Social Security Act, 42 U.S.C. 1395. Under a “complex statutory and regulatory regime” called Medicare Part A, the Government reimburses participating hospitals for care that they provide to inpatient Medicare beneficiaries. Most hospitals are reimbursed for inpatient hospital services pursuant to a standardized rate, but the Social Security Act also provides a method for calculating reimbursement rates for certain rural hospitals that qualify as “sole community hospital[s]” (SCHs) or that qualify as “medicare-dependent small rural hospital[s]” (MDHs). SCHs and MDHs receive reimbursement based on either the standard rate or a hospital-specific rate derived from its actual costs of treatment in one of the base years specified in the statute, whichever is higher. MDHs and SCHs challenged revisions to the rules covering their Medicare reimbursements for inpatient hospital services, arguing that the Medicare statute forbids the Secretary from modifying the hospitals’ reimbursements with budget neutrality adjustments from years prior to the base year. The district court rejected the claims. The D.C. Circuit affirmed, finding that the revisions were neither arbitrary nor manifestly contrary to the statute. View "Adirondack Med. Ctr. v. Burwell" on Justia Law

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The Tribe filed claims in 2005 against the Department for unpaid contract support costs that accrued from 1996 through 1998. At issue was whether the Tribe may sue under the doctrine of equitable tolling even though the statute of limitations has lapsed. The court concluded that the Tribe's claims were barred by the statute of limitations because the legal misunderstandings and tactical mistakes the Tribe identified did not amount to extraordinary circumstances justifying equitable tolling. Accordingly, the court affirmed the judgment of the district court. View "Menominee Indian Tribe v. United States" on Justia Law

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Relator filed suit under the False Claims Act (FCA), 31 U.S.C. 3729-3733, alleging that the HP products Govplace sold to the federal government originated from non-designated countries, in violation of the Trade Agreements Act of 1979 (TAA), 19 U.S.C. 2501-2581. The court affirmed the district court's grant of summary judgment to Govplace, concluding that the district court properly exercised its discretion in managing discovery and that Govplace reasonably relied on Ingram Micro's certification. The court concluded that a contractor like Govplace is ordinarily entitled to rely on a supplier's certification that the product meets TAA requirements. In this case, Govplace has informed the GSA during multiple Contractor Administrator Visits that it relies on Ingram Micro's Program in representing that the country of origin information for the items listed in its GSA schedule is accurate, and GSA's Administrative Report Cards evaluating Govplace have all concluded that Govplace has complied with the TAA. View "Folliard v. Government Acquisitions, Inc., et al." on Justia Law

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Appellant, the President and CEO of a tobacco company called Medallion, filed a qui tam action against Philip Morris, alleging that Philip Morris violated the False Claims Act (FCA), 31 U.S.C. 3729-3733, for failing to provide the government with "Most Favored Customer" pricing. The district court concluded that it lacked subject matter jurisdiction due to the FCA's public disclosure bar. The court concluded, however, that neither the contract term obligating Philip Morris to provide the government with Most Favored Customer pricing nor Philip Morris's fraudulent certifications that it complied was publicly disclosed. Accordingly, the court vacated and remanded for further proceedings. View "United States v. Philip Morris USA Inc." on Justia Law

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Relator filed a qui tam complaint against Verizon under the False Claims Act, 31 U.S.C. 3730(b)(5). On appeal, relator challenged the district court's dismissal of his qui tam complaint for lack of subject matter jurisdiction under Rule 12(b)(1). The court held that the complaint sufficiently related to relator's earlier action, that the first-to-file bar applied to relator even though he brought the first action, and that the bar remained in effect even after the first action was no longer pending. Accordingly, the court affirmed the judgment of the district court. View "United States v. Cellco Partnership, et al." on Justia Law

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Fisher-Cal filed suit alleging that the Air Force violated the Administrative Procedure Act (APA), 5 U.S.C. 500 et seq., when the Air Force opted not to renew a contract for multimedia services with Fisher-Cal and decided to in-source the services. On appeal, Fisher-Cal challenged the district court's appeal of its suit for lack of subject matter jurisdiction. The court accepted the reasoning of the Federal Circuit in Distributed Solutions, Inc. v. United States, which held that lawsuits involving decisions whether to in-source or contract fell within the jurisdiction of the Tucker Act, 28 U.S.C. 1491. Accordingly, Fisher-Cal's challenge to the Air Force's decision to in-source was governed by the Tucker Act and therefore the U.S. Court of Federal Claims had jurisdiction over the challenge. Accordingly, the court affirmed the judgment of the district court. View "Fisher-Cal Indus., Inc. v. United States, et al." on Justia Law