United States District Court, N.D. Illinois, Eastern Division
UNITED STATES EX REL. JESSE SLOAN, Plaintiff and Relator,
WAUKEGAN STEEL, LLC, Defendant.
MEMORANDUM OPINION AND ORDER
JORGE ALONSO UNITED STATES DISTRICT JUDGE.
Jesse Sloan, brings this case on behalf of the United States
under the False Claims Act, 31 U.S.C. §§3729,
et seq., against his former employer, defendant
Waukegan Steel, LLC (“Waukegan”). Defendant moves
to dismiss. For the following reasons, the motion is denied.
February 2013, defendant Waukegan, a structural steel
fabricator and contractor, accepted a “Purchase
Order” from Charpie Korte Industries LLC
(“Charpie Korte”), a general contractor hired by
the United States Army Corps of Engineers
(“USACE”) to build an Army Reserve Center in
Rockford, Illinois. (Compl. ¶ 5., ECF No. 1;
Id. Ex. A, Purchase Order, ECF No. 1 at 10.) The
order called for defendant to fabricate and install
structural steel at the Rockford project. (Id.
¶ 5.) Relator, who was employed by defendant at the
time, brings this suit claiming that defendant made false
statements in order to receive payment for the job with
Purchase Order specified that defendant's work was to
“comply with the Contract Document, design criteria and
function properly” and that defendant will produce
“all reports on testing of systems, as required, to the
Owner and Contractor.” (Compl. ¶ 10 (citing
Exhibit A, Purchase Order Attachment “A” ¶
1.4, 1.11).) The “Design Specifications” of the
contract between Charpie Korte and USACE (attached as Exhibit
B) required contractors to adhere to a number of professional
codes, including those of the American Institute of Steel
Construction (AISC), the American Society for Testing and
Materials (ASTM), and the American Welding Society (AWS).
(Compl. ¶ 11; id. Ex. A ¶ 1.23.5;
id. Ex. B, Design Specifications, at 47-49, ECF No.
1 at 50-52.) The “material certification”
provision of the Design Specifications required as follows:
The Fabricator shall provide an affidavit stating that the
structural steel furnished meets the requirements of this
specification. . . . [C]ertified reports of tests made by the
Fabricator or a testing laboratory in accordance with ASTM A6
or A568, as applicable, shall constitute sufficient evidence
of conformity with the above standards.
(Id. Ex. B at 49.)
alleges that after delivering the steel Charpie Korte had
ordered, defendant sought payment. (Id. ¶ 15.)
Charpie Korte required defendant to submit “fabrication
quality control and weld inspection certifications” to
the Army Corps of Engineers before it would pay defendant for
its work. (Id. ¶ 15.) According to relator,
defendant did not have any such certificates. (Id.
¶¶ 15-17.) Wayne Greisbaum, president of Waukegan,
allegedly asked relator to fabricate the inspection
certifications so that defendant could send them to Charpie
Korte for payment out of government funds. (Id.
relator refused, Mr. Greisbaum allegedly approached another
employee, Artemis Gonzales, who was not a qualified welding
inspector, and requested that he fabricate the
certifications. (Id. ¶¶ 19-20.) According
to relator, Mr. Gonzales fabricated the requested
certifications, and Mr. Greisbaum signed them. (Id.
¶¶ 19-20.) Defendant then submitted the
certifications in order to obtain payment, knowing they were
false. (Id. ¶ 20, see Id. Ex. C, Shop
[Quality Control] Reports, In Process And Final Inspection of
Fabricated Structural Steel.) Relator claims that, based on
these facts, defendant “(a) knowingly presented and/or
(b) caused to be presented, false or fraudulent claims to the
United States government, ” which the government paid.
(Id. ¶¶ 21-22.)
motion under Federal Rule of Civil Procedure 12(b)(6) tests
whether the complaint states a claim on which relief may be
granted. Richards v. Mitcheff, 696 F.3d 635, 637
(7th Cir. 2012). Under Rule 8(a)(2), a complaint must include
“a short and plain statement of the claim showing that
the pleader is entitled to relief.” Fed.R.Civ.P.
8(a)(2). The short and plain statement under Rule 8(a)(2)
must “‘give the defendant fair notice of what . .
. the claim is and the grounds upon which it
rests.'” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355
U.S. 41, 47 (1957)).
federal notice-pleading standards, a complaint's
“[f]actual allegations must be enough to raise a right
to relief above the speculative level.”
Twombly, 550 U.S. at 555. Stated differently,
“a complaint must contain sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting
Twombly, 550 U.S. at 570). “A claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged.”
Id. (citing Twombly, 550 U.S. at 556).
“In reviewing the sufficiency of a complaint under the
plausibility standard, [courts must] accept the well-pleaded
facts in the complaint as true, but [they] ‘need[ ] not
accept as true legal conclusions, or threadbare recitals of
the elements of a cause of action, supported by mere
conclusory statements.'” Alam v. Miller Brewing
Co., 709 F.3d 662, 665-66 (7th Cir. 2013) (quoting
Brooks v. Ross, 578 F.3d 574, 581 (7th Cir. 2009)).
any claims asserted under the False Claims Act must comply
with Federal Rule of Civil Procedure 9(b), which requires the
pleading party to “state with particularity the
circumstances constituting fraud.” United States ex
rel. Presser v. Acacia Mental Health Clinic, LLC, 836
F.3d 770, 775 (7th Cir. 2016). Although fraudulent or
deceptive intent “may be alleged generally, ”
Rule 9(b) requires a plaintiff (or in this case, relator) to
describe the “circumstances” of the alleged fraud
with “particularity” by including such
information as the “the identity of the person who made
the misrepresentation, the time, place and content of the
misrepresentation, and the method by which the
misrepresentation was communicated, ” Windy City
Metal Fabricators & Supply, Inc. v. CIT Tech. Fin.
Servs., Inc., 536 F.3d 663, 668 (7th Cir. 2008). This
“ordinarily requires describing the ‘who, what,
when, where, and how' of the fraud, although the exact
level of particularity that is required will necessarily
differ based on the facts of the case.” AnchorBank,
FSB v. Hofer, 649 F.3d 610, 615 (7th Cir. 2011)
person is liable to the United States government under the
False Claims Act (“FCA”), 31 ...