United States v. Govplace
930 F. Supp. 2d 123
D.D.C.2013Background
- Relator brings qui tam FCA action alleging Govplace sold products under government contracts from non-designated countries in violation of the TAA.
- Four HP product numbers (Q5403A, 416577-B21, AG052A, Q5983A) are at issue for summary judgment; remaining claims have been resolved in earlier decisions.
- Govplace relied on Ingram Micro’s country-of-origin certifications to certify TAA compliance for the four products.
- Relator argues Govplace acted knowingly by failing to verify Ingram Micro’s representations against HP data and other information.
- Court previously deferred ruling on these four products pending focused discovery regarding Govplace’s reliance on Ingram Micro; discovery has now occurred.
- Court grants summary judgment for Govplace on the four disputed product numbers, dismissing the action with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Govplace present a claim for payment for the disputed products? | Folliard; Govplace sold products and thus submitted claims for payment. | Govplace did not dispute sale; issue is proven. | Conceded; first element satisfied for these products. |
| Were the claims false or fraudulent under the FCA for the disputed products? | Folliard contends products were China-made and not TAA-compliant, making claims false. | Govplace relied on Ingram Micro’s representations; product origin disputed; evidence insufficient to prove falsity beyond reasonable doubt. | Court found insufficient admissible evidence to prove falsity; summary judgment granted on these four products. |
| Did Govplace act knowingly (scienter) by relying on Ingram Micro’s representations? | Govplace’s reliance on a nondelegable duty to verify means knowledge of false claims; reckless disregard evidenced by inconsistencies. | Relied reasonably on Ingram Micro; continued reliance after reviewing procedures; not gross negligence-plus. | Govplace’s reliance was reasonable; no showing of knowing fraud; summary judgment granted for the four products. |
| Are there jurisdiction or admissibility issues with the Albright declaration and FOIA-based materials? | Albright declaration and related materials show falsity; jurisdiction concerns due to public-disclosure bar and FOIA-derived evidence. | Albright declaration lacks personal knowledge; potential jurisdiction problems; substantial issues avoided by dismissal on remaining grounds. | Admissibility and jurisdiction concerns noted; nevertheless summary judgment granted on the four products; case dismissed with prejudice. |
Key Cases Cited
- United States ex rel. Schwedt v. Planning Research Corp., 59 F.3d 196 (D.C. Cir. 1995) (three FCA elements; knowledge requirement for claims)
- Krizek v. Massachusetts Hous. Fin. Agency, 111 F.3d 934 (D.C. Cir. 1997) (reckless disregard as sufficient for knowing false claims)
- Odebrecht Contractors of California, Inc. v. United States, 297 F.Supp.2d 272 (D.D.C. 2004) (summary judgment requires evidence of knowing fraud)
- United States ex rel. Ervin & Assocs. v. Hamilton Sec. Group (Ervin II), 370 F.Supp.2d 18 (D.D.C. 2005) (gross negligence-plus standard for knowing FCA claims)
- United States ex rel. Ervin v. Hamilton Sec. Group (Ervin I), 298 F.Supp.2d 91 (D.D.C. 2004) (reliance on subcontractors may be insufficient for knowing fraud)
- McCready v. Columbia/HCA Healthcare Corp., 251 F.Supp.2d 114 (D.D.C. 2003) (scienter and evidence standard for FCA summary judgment)
- Graham Cnty. Soil & Water Conservation Dist. v. United States ex rel. Karen Wilson, 559 U.S. 280 (2010) (public disclosure bar in FCA actions)