Term: 2007
Docket: 07-214
Allison Engine Company, Inc., Et Al. v. United States Ex Rel. Roger L. Sanders And Roger L. Thacker
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07-214 ALLISON ENGINE CO., INC V. UNITED STATES DECISION BELOW: 471 F3d 610 CERT. GRANTED 10/29/2007 QUESTION PRESENTED: QUESTION PRESENTED Sections 3729(a)(2) and 3729(a)(3) of the False Claims Act impose liability upon anyone who uses a “false record or statement to get a false or fraudulent claim paid or approved by the Government” or who “conspires to defraud the Government by getting a false or fraudulent claim allowed or paid.” 31 U.S.C. § 3729(a)(2), (a)(3). In direct conflict with the decisions of four other circuits, the Sixth Circuit held that Sections 3729(a)(2) and 3729(a)(3) “cover[] false claims made to parties other than the government so long as the claim will be paid with government funds.” The question presented is whether a plaintiff asserting a cause of action under Section 3729(a)(2) or Section 3729(a)(3) of the False Claims Act is required to prove that a false claim was submitted to the federal government, or whether it is sufficient to establish that the claim was paid using federal funds. LOWER COURT CASE NUMBER: 05-3502
The case of Allison Engine Company, Inc., et al. v. United States ex rel. Roger L. Sanders and Roger L. Thacker in 2007 revolved around the interpretation of the False Claims Act (FCA). The plaintiffs, Sanders and Thacker, were former employees who alleged that Allison Engine Co., along with other defendants involved in a Navy contract for ship construction, had submitted false claims for payment to the U.S government indirectly through private intermediaries rather than directly to the federal government itself. The Supreme Court was asked to determine whether such indirect claims fell under FCA's jurisdiction or if it only applied when fraudulent claims were made directly to federal officials. In a unanimous decision led by Justice Alito, they ruled that liability under FCA does not require proof that defendant intended their false statement or record be material to Government’s decision to pay claim; instead what matters is whether defendant knowingly made a false statement with intent for it be used in obtaining Government funds.
In the dissenting opinion for Allison Engine Company, Inc., et al. v. United States ex rel. Roger L. Sanders and Roger L. Thacker, Justice Stevens argued that the majority's interpretation of the False Claims Act was too narrow and failed to fully address Congress' intent when it amended the law in 1986 to combat fraud against government funds more effectively. He contended that any false claim made by a subcontractor that results in loss of federal funds should be considered a violation under this act, regardless if they intended for their false statement to influence government decision-making directly or not; what matters is whether they knowingly caused wrongful charges on public money.
