Carl Schroeder v. United States
793 F.3d 1080
9th Cir.2015Background
- Schroeder worked for CH2M Hill and submitted false time cards, receiving at least $50,000 in improperly billed overtime.
- The DOE Office of Inspector General investigated; Schroeder admitted over-billing during an interview and later pled guilty to conspiracy to commit fraud.
- While the investigation was ongoing, Schroeder filed a qui tam suit under the False Claims Act (FCA) against CH2M Hill; the United States later intervened.
- After Schroeder’s guilty plea, the government moved to dismiss him as relator under 31 U.S.C. § 3730(d)(3), which mandates dismissal of a relator convicted of criminal conduct arising from the violation.
- The district court dismissed Schroeder; he appealed, arguing § 3730(d)(3) should not require dismissal of convicted minor participants who did not “plan and initiate” the fraud.
- The Ninth Circuit affirmed, holding the statute’s plain text requires dismissal of any relator convicted of criminal conduct arising from the FCA violation, even if the relator was a minor participant.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether 31 U.S.C. § 3730(d)(3) requires dismissal of a qui tam relator convicted of criminal conduct arising from the fraud, including minor participants | § 3730(d)(3) should be read to dismiss only relators who “planned and initiated” the fraud; minor participants convicted should remain relators and recover | The statute’s plain language mandates dismissal of any relator convicted of criminal conduct arising from the violation, without a minor-participant exception | The court held the statute unambiguously requires dismissal of a relator convicted of criminal conduct arising from the FCA violation, even for minor participants |
Key Cases Cited
- Roberts v. Accenture, LLP, 707 F.3d 1011 (8th Cir. 2013) (interpreting § 3730(d)(3) as mandatory dismissal for convicted relators)
- U.S. ex rel. Taxpayers Against Fraud v. Gen. Elec. Co., 41 F.3d 1032 (6th Cir. 1994) (concluding the criminal-conduct clause bars convicted relators)
- Lamie v. U.S. Tr., 540 U.S. 526 (2004) (plain text rule for statutory interpretation)
- Gale v. First Franklin Loan Servs., 701 F.3d 1240 (9th Cir. 2012) (grammatical cues can inform whether clauses refer to the same subject)
- United States v. Steele, 147 F.3d 1316 (11th Cir. 1998) (canon: Congress says what it means)