United States ex rel. Omar Badr v. Triple Canopy, Inc.
2015 U.S. App. LEXIS 277
| 4th Cir. | 2015Background
- The U.S. Government awarded Triple Canopy a firm-fixed-price Task Order (TO-11) to provide internal security at Al Asad Airbase; TO-11 included a specific marksmanship requirement (23/40 at 25 meters) and required scorecards be kept in personnel files.
- Triple Canopy employed ~332 Ugandan guards supervised by Americans; on arrival supervisors learned many guards could not qualify on the marksmanship course.
- Despite knowledge of failures, Triple Canopy continued to submit monthly invoices for guards and supervisors directed falsified marksmanship scorecards (including post-dated sheets) to be placed in files.
- Relator Omar Badr filed a qui tam FCA suit alleging multiple counts (Al Asad and four other bases); the Government intervened on the Al Asad claim and alleged violations of 31 U.S.C. §3729(a)(1)(A) (false claim) and §3729(a)(1)(B) (false records).
- The district court dismissed the Government’s Counts I–II and dismissed Badr’s Counts II–V (and Badr’s Count I as superseded); Fourth Circuit reviews de novo and accepts pleaded facts as true.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether monthly invoices constituted a "false or fraudulent claim" under §3729(a)(1)(A) via implied certification of compliance with TO-11 | Government: invoices implied certification that guards met material contract requirements (marksmanship); Triple Canopy knowingly withheld noncompliance and billed anyway | Triple Canopy: invoiced numbers were not objectively false on their face; disputes about contract performance are breaches, not FCA fraud | Reversed dismissal: invoices can be false claims under an implied-certification theory when contractor knowingly withholds noncompliance with a material contractual requirement |
| Whether falsified scorecards support a §3729(a)(1)(B) false-records claim and whether actual COR review is required for materiality | Government: falsified scorecards were material because they completed the fraud and were capable of influencing payment decisions; actual review by COR not required | Triple Canopy: scorecards were immaterial absent allegation that the COR actually reviewed them | Reversed dismissal: false scorecards are material if capable of influencing agency action; actual review by COR is unnecessary for materiality |
| Whether relator Badr was "superseded" (lacked standing) after Government intervention on Count I | Badr: may continue as party under §3730(c); intervention does not automatically strip relator of standing | Triple Canopy/district court: Government intervention supersedes relator’s identical claim so relator lacks standing | Reversed: relator retains the right to continue as party on Count I; district court erred to dismiss him as a matter of standing (limitations under §3730(c)(2) remain for district court to consider on remand) |
| Whether Badr’s Counts II–V (other bases) met Rule 9(b) particularity | Badr: allegations that guards were demobilized and transferred unqualified and that payments were similar suffice; discovery could fill gaps | Triple Canopy: allegations are too general and speculative; Rule 9(b) bars fishing expeditions | Affirmed dismissal: Counts II–V fail Rule 9(b); allegations lack time, place, content and actor details necessary to plead FCA fraud with particularity |
Key Cases Cited
- United States ex rel. Harrison v. Westinghouse Savannah River Co., 176 F.3d 776 (4th Cir. 1999) (discusses FCA fraud limits and particularity concerns)
- United States ex rel. Harrison v. Westinghouse Savannah River Co., 352 F.3d 908 (4th Cir. 2003) (materiality focuses on potential to influence agency action)
- United States v. Neifert-White Co., 390 U.S. 228 (U.S. 1968) (FCA construed broadly to reach fraud that causes government loss)
- United States v. Sci. Applications Int’l Corp., 626 F.3d 1257 (D.C. Cir. 2010) (explains implied certification theory where compliance is a material contract requirement)
- Wilson v. Kellogg Brown & Root, Inc., 525 F.3d 370 (4th Cir. 2008) (distinguishes garden-variety contract disputes from FCA fraud; Rule 9(b) and objective falsity requirements)