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UNITED STATES v. PRESIDENT

July 30, 1984

UNITED STATES OF AMERICA, PLAINTIFF,
v.
MAGGIELEAN PRESIDENT, JANICE DELRIDGE, CARRIE LYONS, DEFENDANTS.



The opinion of the court was delivered by: Bua, District Judge.

  ORDER

The instant suit involves claims against the defendants for defrauding the government. Before the Court is defendant President's motion to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted, or, in the alternative, to strike any claims dating before March 16, 1978 as barred by the applicable statutes of limitation. Defendant Delridge makes the same motion on the same premises as President. Also pending is the plaintiff's motion for summary judgment against defendants President and Lyons, pursuant to Rule 56(a) of the Federal Rules of Civil Procedure.

For the reasons stated herein, President and Delridge's motions are denied and the United States' motion for summary judgment against President and Lyons is granted.

I.

The government's motion for summary judgment is supported by various affidavits and other documents. These include an affidavit of Bonita Mullins, Special Agent, Office of the Inspector General of the United States Department of Labor, an affidavit of defendant Maggielean President, an affidavit of defendant Carrie Lyons, defendant President's Official Personnel Folder, false claim vouchers admittedly prepared by defendant President, and canceled checks made out to President under various names, defendant Delridge, and defendant Lyons. From these documents, the following undisputed facts may be gleaned.

Maggielean President was employed at the U.S. Post Office in Chicago as a distribution clerk and mail handler from December 22, 1965 through May 24, 1969, when she transferred to the U.S. Department of Labor, Office of Workers' Compensation Programs. From July 23, 1972 until April 20, 1980, Maggielean worked as a claims and benefit payment roll clerk. Her duties in this position included the preparation of compensation and medical bill payment vouchers. On April 20, 1980, she was given a promotion to Lead Benefit Payment Roll Clerk. On August 22, 1980, President was terminated by the Department of Labor "for falsification of official documents and use of confidential files for personal benefit." This termination was unrelated to the acts complained of in the instant case.

In September, 1983, the Portland, Oregon office of the IRS, Criminal Investigations Division, contacted the Department of Labor and requested information relative to Janice Delridge and her receipt of Department of Labor funds. When a search of Department of Labor records revealed that Delridge was not a Workers' Compensation claimant, but nevertheless was a payee named on payment vouchers, the Office of the Inspector General of the Department of Labor started an investigation which resulted in the discovery that over 120 payment vouchers had been altered, causing fraudulent payments to be issued to Maggielean President under the aliases of M.L. Gillon, M.L. Matthews, and Maggielean Dunlap or Dunlop. (President's maiden name is Matthews and her former married name was Gillon. Dunlap or Dunlop are aliases used by her.) Fraudulent payments were also issued to Janice Delridge, President's sister, and Carrie Lyons, who formerly worked with President.

During the afternoon of March 16, 1984, Special Agents Mullins and Knapstein interviewed President in the kitchen of her home. During the interview, President admitted to altering the payment vouchers which resulted in the false compensation payments being sent to her, Delridge, and Lyons. She also admitted that the payments had been discussed by her with Delridge and Lyons and that her two co-defendants knew that the payments were not the result of bona fide compensation claims. President then signed an affidavit in which she admits to altering the payment vouchers and to causing the fraudulent payments to be sent to the three defendants.

Also on March 16, 1984, Agents Mullins and Knapstein interviewed Lyons in her home. At the interview and in an affidavit signed at that time, Lyons admitted that she was receiving compensation checks which she was not rightfully entitled to as they were not for a legitimate claim, and that President had caused such checks to be issued. While Lyons now claims that she requested President to stop sending the checks, she makes no mention of ever attempting to return her ill-gotten gains.

II.

This is a civil complaint in four counts brought by the United States against defendant President and co-defendants Delridge and Lyons. The amended complaint alleges in Count I that President, in the course of her employment, caused to be falsely issued 131 United States Treasury checks totaling $628,960.78 made payable to M.L. Gillon, M.L. Matthews, Maggielean Dunlap or Dunlop, Janice Delridge and Carrie Lyons. It is further alleged that these checks were issued pursuant to a conspiracy among the defendants to embezzle this sum from the United States.

In Count I, the United States also alleges that of the total of $628,960.78 embezzled, President received $355,166.30, Delridge received $233,345.66, and Lyons received $40,448.82. The United States claims that by this conduct, President violated the fiduciary duty she owed to the plaintiff and breached her employment contract. In relief, the plaintiff asks for a judgment of $628,960.78 plus interest and costs of this suit against President.

In Count II, the United States claims that as a result of the actions and conspiracies alleged in Count I, President, Delridge, and Lyons have received monies of the United States obtained by fraud, and failed to remit, return or account for said monies. The plaintiff asks for an accounting with respect to all monies and all real and personal property derived therefrom, and further asks that this court impose upon the defendants a constructive trust, or trust ex maleficio, on all property, earnings, income, profits, proceeds, benefits, or things of value resulting from the defendants' alleged misconduct.

In Count III, the plaintiff claims that by their conduct and through their conspiracy, the defendants violated the Federal False Claims Act, 31 U.S.C. ยง 3729 et seq. The United States asks for judgment against the defendants in the amount of double ...


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