The opinion of the court was delivered by: Grady, District Judge.
Before the court is defendant's motion to dismiss the plaintiffs
amended complaint. For the reasons explained below, the motion is
Joseph Garst is a former employee of the United States Department of
Veteran Affairs ("VA") who initiated this qui tam action against Lockheed
Integrated Solutions Company ("Lockheed") under the False Claims Act
("FCA"). See 31 U.S.C. § 3729 (West Supp. 2000). The action seeks to
recover damages and civil penalties on behalf of the United States
arising from alleged false or fraudulent claims for payment presented to
The following facts are drawn from Garst's amended complaint
("complaint"), which we take as true for purposes of deciding this
motion. In 1990, the VA issued a Request for Proposal ("RFP") for a
nationwide office automation system for the VA. The project was known as
"NOAVA," an acronym that stands for Nationwide Office Automation-Veterans
Administration. The VA awarded the NOAVA contract to Lockheed, a wholly
owned subsidiary of Lockheed Martin Corporation, in 1990. Lockheed hired
a subcontractor known as SSDS, Inc.
The RFP required that the NOAVA system be compatible with certain
computer systems the VA had already purchased, in particular, the
Integrated Supply Management System ("ISMS"), its financial module,
PRISM, and a network operating system known as Banyan VINES. It also
required that the NOAVA system meet certain security guidelines. Under
the contract, the VA was obligated to purchase equipment for the NOAVA
contract from Lockheed alone.
In 1993, Garst submitted a detailed memorandum to the Office of the
Inspector General ("OIG") complaining of Lockheed's performance. The OIG
conducted an audit of the NOAVA contract and issued a report in September
of 1994, finding that the VA did not maintain records adequate to enable
oversight of Lockheed's performance of the NOAVA contract or of
Lockheed's pricing practices. The OIG report found that about three
million dollars was paid to Lockheed in late payment penalties, in part
due to deficiencies in Lockheed's billing practices. In addition, the OIG
report found that the VA's contracting officer was not authorized to
commit the VA to the large expenditures under the NOAVA contract.
Thereafter, Garst and others who complained about the "fraudulent
aspects of the Lockheed NOAVA contract" suffered reprisals and were
"removed from the communication loop concerning the NOAVA contract."
Garst himself was forced out of the VA after he complained.
In 1998, Garst filed this complaint under the qui tam provision of the
False Claims Act ("FCA"), which authorizes private individuals to file
suit against any entity alleged to have presented a false or fraudulent
claim for payment to the federal government. See 31 U.S.C. § 3730
(b). After these private individuals, known as "relators" or qui tam
plaintiffs," file their complaints under seal, the government then has an
opportunity to investigate and decide whether to intervene.
31 U.S.C. § 3730 (b)(2). If the government decides not to intervene,
the complaint is unsealed and the suit proceeds. The relator is entitled
to a share of the proceeds if the action is successful, the amount
depending, in part, on whether or not the government intervenes.
3730(b)(1), (d)(1) (if the government joins the suit the relator is
eligible to receive between fifteen and twenty-five percent of the
judgment). Here, the government elected not to intervene, so the relator
is eligible to collect thirty to thirty-five percent of the proceeds if
the action is successful.
The defendant brings this motion to dismiss on the grounds that: (1)
the relator has not pled fraud with particularity; (2) he has not stated
a claim under the False Claims Act; (3) and the six year statute of
limitations on the only bill presented (June of 1992) ran before the
complaint was filed in August of 1998.
A. Count I: Violations of § 3729(a)(1), (2), and (7).