United States Ex Rel. Folliard v. Synnex Corp.
798 F. Supp. 2d 66
D.D.C.2011Background
- Relator Folliard, an Insight Public Services employee, brings a qui tam FCA action alleging TDs misrepresented country-of-origin for products listed on GSA SEWP/GSA Schedules.
- Defendants include Synnex, Emtec, Gov't Acq, HP, GovConnection, GovPlace, Force 3, and GTSI; claims focus on products from non-designated countries allegedly listed as TAA compliant.
- Crennen v. Dell Marketing L.P. (D. Mass.) previously alleged similar TAA violations against several named defendants and prompted government investigation.
- Folliard’s complaint was unsealed after the government declined intervention; defendants moved to dismiss on first-to-file bar, Rule 9(b) pleading, and failure to state a claim.
- Court applies FCA first-to-file bar, Rule 9(b) heightened pleading, res judicata, and standard 12(b)(6) review to determine which claims survive.
- Court concludes: (i) first-to-file bar precludes several defendants; (ii) HP claims may be precluded by res judicata; (iii) GovPlace and Govt. Acq. survive 9(b) and Rule 12(b)(6) challenges and may proceed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether FCA first-to-file bar precludes subsequent relators | Folliard argues none of the claims are substantially identical to Crennen's prior allegations. | Defendants contend Crennen’s complaint preempts related claims under § 3730(b)(5) as related actions with same material elements. | Precluded as to Synnex, Emtec, GovConnection, Force 3, and GTSI. |
| Whether HP claims are barred by res judicata | Folliard asserts HP claims could be distinct due to different contracts (NASA SEWP) and not identical to prior suit. | HP argues prior dismissal bars relitigation of those claims. | HP claims precluded by res judicata; dismissal affirmed on that basis. |
| Whether GovPlace and Government Acquisitions, Inc.'s claims are pled with particularity | Folliard contends he provides detailed misrepresentations tied to specific orders and GSA listings. | GovPlace/Govt. Acq. argue failure to plead fraud with particularity, especially who participated. | Sustain Rule 9(b) pleading; complaint adequate to proceed. |
| Whether GovPlace and Government Acquisitions, Inc. state a claim under Rule 12(b)(6) | Relator asserts enough facts to infer false claims occurred from mislisted products tied to procurement orders. | Defense asserts lack of plausible entitlement to relief due to pleading gaps. | Complaint state a claim; denial of 12(b)(6) motions. |
Key Cases Cited
- Hampton v. Columbia/HCA Healthcare, Corp., 318 F.3d 214 (D.C. Cir. 2003) (first-to-file FCA context and notice to government)
- Ortega v. Columbia Healthcare, Inc., 240 F. Supp. 2d 8 (D.D.C. 2003) (high-level comparison for first-to-file material elements)
- LaCorte v. SmithKline Beecham Clinical Laboratories, Inc., 149 F.3d 227 (3d Cir. 1998) (definition of 'related action' and preclusion under first-to-file)
- Walburn v. Lockheed Martin Corp., 431 F.3d 966 (6th Cir. 2005) (limits of Rule 9(b) non-preclusion in first-to-file context)
- Campbell v. Redding Medical Center, 421 F.3d 817 (9th Cir. 2005) (sham complaints and notice to government in first-to-file)