United States Ex Rel. Hood v. Satory Global, Inc.
946 F. Supp. 2d 69
D.D.C.2013Background
- Relators Robin Hood and Maxon were recruited to work for Satory Global, LLC on a DOJ IT support contract as at-will employees, moving to DC with relocation support.
- They allege Satory billed DOJ for private corporate work and steered projects to benefit Satory, including a private Microsoft/business development effort while DOJ facilities were used.
- Robin was reassigned from SharePoint duties to Lab Manager and ultimately terminated; Maxon resigned/was constructively discharged amid alleged misconduct.
- Plaintiffs filed a qui tam FCA action and DC common-law claims in 2011; the United States declined to intervene, and Satory moved to dismiss.
- The court held FCA claims survive the relator’s death and allowed substitution of a successor in interest, but dismissed the DC common-law wrongful termination, breach of contract, and punitive damages claims, while allowing Counts I–IV to proceed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Do FCA qui tam claims survive the relator’s death? | Relator survival under NEC Corp.; FCA remedial nature. | Harrington exception suggested no survival. | Yes, FCA claims survive; substitution allowed. |
| Do Counts I–II (presentment of false claims) state a claim under Rule 9(b) and survive dismissal? | Allege factually false invoices and related certifications. | Lack of specific invoices, dates, and signature actors. | Counts I–II survive; adequately pleaded under Rule 9(b) and plausibility standard. |
| Do Count III (false statements) satisfy Rule 9(b) and plead material false records? | Allege specific misrepresentations and certification of contract compliance. | Insufficient detail on time/place/content. | Count III survives; properly pleaded with specificity and materiality. |
| Is the FCA retaliation claim (Count IV) viable given protected activity and causal link? | Plaintiffs engaged in protected activity and suffered adverse actions. | Retaliation requires protected activity tied to adverse action; arguments insufficient. | Count IV survives; retaliation plausibly alleged. |
| Are Counts V–VII (wrongful termination, breach of contract, punitive damages) viable? | Alternative remedies and contract theories survive FCA context. | Nolting/Kassem bar: at-will with existing remedies; no contract terms shown; punitive damages not standalone. | Counts V, VI, VII dismissed. |
Key Cases Cited
- Twombly v. Bell Atl. Corp., 550 U.S. 544 (U.S. 2007) (plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (text pleading standard; reject mere conclusory statements)
- United States v. NEC Corp., 11 F.3d 136 (11th Cir. 1993) (FCA viability survives relator death; remedial nature)
- Harrington v. Sisters of Providence in Oregon, 209 F. Supp. 2d 1085 (D. Or. 2002) (early view denying survival; criticized post-Chandler)
- Chandler v. Cook County, 538 U.S. 119 (U.S. 2003) (Supreme Court on FCA purposes; dual punitive/remedial)
- Kassem v. Washington Hospital Ctr., 513 F.3d 251 (D.C. Cir. 2008) ( Nolting rule; common-law claims barred when statutory remedy exists)
- Elemary v. Philip Holzmann, A.G., 533 F. Supp. 2d 116 (D.D.C. 2008) (extension of Nolting to FCA context)