United States Ex Rel. Scott v. Pacific Architects & Engineers, Inc.
270 F. Supp. 3d 146
| D.D.C. | 2017Background
- Relators Patricia Scott and John L. Tudbury worked for PAE in Lebanon on INL-funded civilian police training contracts and allege PAE billed the U.S. government for hours not actually worked from ~Dec. 2007–Dec. 2011.
- Alleged falsification methods included: labeling non-work (sightseeing, mall visits, gym, etc.) as “team building,” marking absent employees as “available,” and billing for training sessions that did not occur.
- Relators identify two PAE managers (Thomas Barnes and Dan Moritz) as encouraging “creative billing,” and provide time ranges and examples of affected pay periods and employee names.
- Additional allegations: early submission of timesheets requiring fabrication, hiring underqualified personnel, misuse of government-funded drivers, and steering employees to buy expensive airfare for a commission.
- Both relators claim they were retaliated against for investigating/reporting the billing practices; Scott alleges termination orchestrated by PAE, Tudbury’s account of departure is internally inconsistent.
- Procedural posture: PAE moved to dismiss under Rules 9(b) and 12(b)(6). Court granted the motion in part and denied it in part (Mem. Op. and Order, Sept. 13, 2017).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Relators pleaded viable FCA presentment claims (31 U.S.C. § 3729(a)(1)(A)) | Relators: PAE submitted false invoices and caused false claims by billing for hours not worked using specific schemes and managers’ directions | PAE: Complaint lacks the particularity required by Rule 9(b) and fails to plausibly plead false claims | Held: Denied as to presentment claims — pleaded with sufficient particularity (time span, location, schemes, responsible managers) to survive dismissal |
| Whether Relators pleaded viable false-record/statement claims (31 U.S.C. § 3729(a)(1)(B)) | Relators: Timesheets and GSA 139 forms were false/material to claims | PAE: Same Rule 9(b) challenge; alleged records are not particular enough | Held: Denied as to § 3729(a)(1)(B) — allegations adequately plead false records/statements material to claims |
| Whether Relators stated a reverse-FCA claim (31 U.S.C. § 3729(a)(1)(G)) | Relators: PAE invoiced medical expenses but failed to reimburse relators, concealing obligation to return money to the government | PAE: Reverse-claim theory duplicates presentment theory and doesn’t allege an independent obligation to repay | Held: Granted — reverse-FCA claim dismissed without prejudice because it would collapse into the ordinary false-claim theory |
| Whether relators stated retaliation claims under § 3730(h) | Scott & Tudbury: Engaged in protected investigations and were discriminated/terminated because of that activity | PAE: Scott was performing job duties and position was eliminated by the State; Tudbury left voluntarily so no actionable retaliation | Held: Split — Scott's § 3730(h) claim survives (pleaded protected activity and causal nexus); Tudbury's § 3730(h) claim dismissed without prejudice due to contradictions and insufficient facts |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (pleading standard: factual plausibility requirement)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (pleading standard: more than labels and conclusions)
- United States ex rel. Heath v. AT&T, Inc., 791 F.3d 112 (Rule 9(b) contextual flexibility; ensure defendant can mount a defense)
- United States ex rel. Williams v. Martin-Baker Aircraft Co., Ltd., 389 F.3d 1251 (Rule 9(b) requires identification of who, what, when, where, how)
- United States v. Sci. Applications Int'l Corp., 626 F.3d 1257 (false-claim paradigms and presentment theory)
- United States ex rel. Morsell v. Symantec Corp., 130 F. Supp. 3d 106 (FCA pleading under Rule 9(b))
- United States ex rel. Landis v. Tailwind Sports Corp., 51 F. Supp. 3d 9 (FCA claim theories; statute interpretation)
- Shekoyan v. Sibley Int'l, 409 F.3d 414 (elements of FCA retaliation claim)