U.S. v. Westinghouse Hanford Company

Full title: UNITED STATES OF AMERICA, ex rel, CHARLES D. TRICE and DAVID R. CARBAUGH…

Court: United States District Court, E.D. Washington

Date published: Mar 1, 2000

No. CS-96-0171-WFN (E.D. Wash. Mar. 1, 2000)

Opinion

No. CS-96-0171-WFN.

March 1, 2000

ORDER

WM. FREMMING NIELSEN, District Judge

A hearing was held in this matter on January 19, 2000. Plaintiff Charles Trice participated pro se; Jeffrey Sprung, Steve Berman, and Michael Kanovitz participated on behalf of Plaintiff David Carbaugh; Thomas McLane and Mark Meagher participated on behalf of Defendant Westinghouse Hanford Company [WHC]; William Symmes, John Chierichella, and Otto Klein participated on behalf of Defendant Fluor Daniel Hanford, Inc. [FDH]; and, Marc Boman participated on behalf of Defendant Boeing Computer Services Richland [BCSR]. The Court has reviewed the file and the briefing, considered the oral arguments of counsel, and is fully informed.

Each Plaintiff filed a separate Complaint, although the Complaints are substantially similar. Mr. Trice's Complaint names WHC and BCSR as Defendants, and Mr. Carbaugh's Complaint names WHC and FDH as Defendants. All Defendants filed various Motions to Dismiss against both Plaintiffs. WHC and FDH also filed Motions for Summary Judgment, and a Motion to Strike two Declarations of Jeffrey Sprung. All Motions are addressed in this Order.

I. BACKGROUND

This matter presents a qui tam cause of action under the False Claims Act [FCA], 31 U.S.C. § 3729, et seq. Plaintiffs Trice and Carbaugh properly filed their original, joint Complaint under seal on March 19, 1996, and submitted it to the U.S. Attorney for review. The USA's office declined to intervene on April 21, 1998, and the complaint was unsealed. Plaintiff Carbaugh moved for several extensions of the deadline for service of the Complaint. A Second Amended Complaint finally was filed and served on WHC and FDH on April 6, 1999, by Plaintiff Carbaugh only. Plaintiff Trice became re-involved in the case at the September 13, 1999 hearing. Thus, the current complaints are Plaintiff Trice's Second Amended Complaint, and Plaintiff Carbaugh's Third Amended Complaint. The allegations are essentially identical.

Count 1 of Plaintiffs' Complaints alleges that Defendants defrauded the United States government of over $85 million by using a flawed accounting practice to estimate operating costs, which resulted in consistent over-billing and over-recovery. Both Plaintiffs also bring an FCA claim for retaliation, and state law claims for retaliatory discharge and negligent infliction of emotional distress. Plaintiff Carbaugh additionally alleges discrimination on the basis of disability.

Defendants WHC and FDH, respectively, were and are the prime contractors for the clean-up of the Hanford Nuclear Reservation. WHC managed the site from June 1, 1987, until September 30, 1996. FDH assumed management on October 1, 1996. BCSR was a subcontractor under WHC's management. Plaintiff Carbaugh worked as an accountant for first WHC and then FDH until his termination by FDH in April, 1997. Plaintiff Trice worked as an accountant and manager for WHC until his termination during approximately November, 1995. He also worked for BCSR starting some time in 1995, and continuing until his termination in November, 1995.

The financing of the Hanford clean-up project is complicated. Essentially, Congress determines an annual budget for the project, based in part on Defendants' annual cost estimates.¹ Then, the Department of Energy creates a letter of credit equal to the budgeted amount. Defendants receive compensation for their work by submitting reimbursement claims against the letter of credit, thereby drawing down the amount. These claims are submitted and reimbursed on an on-going basis. At the end of each fiscal year, Defendants must submit a report of actual costs incurred, return any excess monies received, and bear any costs incurred above the letter of credit amount. Defendants receive a portion of any surplus funds remaining at the end of the year as a reward for efficient operation.

1 All general references to "Defendants" in this Background section refer only to WHC and FDH.

One of Defendants' reimbursable costs is employee labor. Defendants are reimbursed for their total labor costs, including "absence costs" such as vacation, sick leave, and holiday leave. WHC apparently created, and certainly used, an elaborate accounting system to determine current costs and estimated future costs. One calculation in this system, the "Absence Adder," was used to estimate the absence portion of total labor costs. The Absence Adder operates by first determining a ratio of average compensated productive employee hours to compensated non-productive (i.e. absence cost) hours. Then, it applies this ratio to all productive hours of all site employees to determine the reimbursement estimate for absence costs as a portion of total labor costs.

FDH assumed the accounting system when it assumed management of the Hanford clean-up. Defendants periodically certified to the Department of Energy that reimbursement estimates were accurate, and that the Absence Adder ratio was based on historical absence averages for all employees.

Plaintiffs' basic contention is that Defendants overcharged the United States for their labor costs because they recovered absence costs for regular and overtime employee hours, but they incurred no absence costs for overtime hours. Plaintiffs did not organize any of the following into specific claims under the FCA, but allege all of the following under Count 1:

(a) The Absence Adder system is fraudulent because it calculates estimated absence costs for regular and overtime hours, even though Defendants incur no absence costs for overtime hours, and thus overcompensates Defendants;

(b) The Absence Adder figures are not accurately based on historical employee absence data as certified in Cost Accounting Standards Board Disclosure Statements, which are statutorily required to be submitted with each bid to receive a management contract. Instead, the figures are higher due to the inclusion of overtime hours in the ratio;

(c) The Absence Adder calculations resulted in improper draw downs against the letter of credit;

(d) The Absence Adder's fraudulent effect is magnified as costs progress through four different "cost pools" in Defendants' overall accounting system, thus poisoning Defendants' entire billing process;

(e) By inflating reimbursement estimates through use of the Absence Adder, Defendants caused the federal budget for the Hanford clean-up to increase each year. The fictitiously increased budget made Defendants' costs appear under budget, which allowed Defendants to recover erroneous bonuses for efficient operation;

(f) Defendants improperly "passed back" reimbursements to improper internal accounts;

(g) Defendants drew down the letter of credit for unallowable costs hidden under headings for allowable costs;

(h) Defendants knowingly and intentionally made their costs appear higher:

(1) they kept internal records of the cost variances that were not shared with the DOE, and used these more detailed internal records to reallocate funds between accounts through improper passbacks. The DOE knew of the passback policy, but not of the internal cost variance records;

(2) DOE requested information about Defendants' passback policy cost variances, but Defendants never provided the information

(3) Defendants falsely certified representations of their passback procedures in Disclosure Statements; and,

(4) Defendants' internal accounting rate (designed to reflect current costs) was a lower rate than one externally used for budget planning

(i) Defendants over-billed "work for others" including a "host of federal agencies and contractors" and private companies with the same fraudulent system.

Plaintiffs also complain that the DOE failed to properly monitor, supervise and investigate the accounting procedures used by Defendants. These allegations usually arise where Plaintiffs concede that the DOE was informed of or approved accounting procedures used by Defendants.

II. STANDARDS OF REVIEW FOR THE MOTIONS

Motion to Dismiss for Lack of Subject Matter Jurisdiction. Fed.R.Civ.P. 12(b)(1) permits a party to move for dismissal of a claim due to a court's "lack of jurisdiction over the subject matter." Plaintiffs must carry the burden of persuading the Court that subject matter jurisdiction exists. See, e.g., Hexom v. Oregon Dept. of Transportation, 177 F.3d 1134, 1135 (9th Cir. 1999), citing Thornhill Publication Co., Inc. v. General Tel. Electronics Corp., 594 F.2d 730, 733 (9th Cir. 1979). A court must construe a complaint broadly and liberally when subject matter jurisdiction is challenged. See, e.g., Aversa v. United States, 99 F.3d 1200, 1209-10 (1st Cir. 1996); 5A CHARLES WRIGHT ALLEN MILLER, FEDERAL PRACTICE PROCEDURE § 1350, p. 218 (2d ed. 1990).

Motion to Dismiss for Failure to State a Claim. Fed.R.Civ.Pro. 12(b)(6) provides for dismissal of causes of action for "failure to state a claim upon which relief can be granted. . . ." Fed.R.Civ.P. 12(b)(6). The issue is not whether the plaintiff is likely to succeed on the merits, but only if the complaint is legally sufficient to entitle the plaintiff to proceed beyond the pleadings in an attempt to establish his claim. De La Cruz v. Torney, 582 F.2d 45, 58 (9th Cir. 1978), cert. denied, 441 U.S. 965 (1979). Plaintiff's material allegations in the Complaint must be accepted as true, and the Complaint is construed in the light most favorable to him. Love v. United States, 915 F.2d 1242, 1245 (9th Cir. 1989). A district court's dismissal is affirmed "only if it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations." Hishon v. King Spalding, 467 U.S. 69, 73 (1984).

Motion for Summary Judgment. A party is entitled to summary judgment where the documentary evidence produced by the parties permits only one conclusion. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The party seeking summary judgment must show that no genuine issue of material fact exists and that he is entitled to judgment as a matter of law by "pointing out" to the Court that there is an absence of evidence to support the non-moving party's case. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). "A material issue of fact is one that affects the outcome of the litigation and requires a trial to resolve the parties' differing versions of the truth." SEC v. Seaboard Corp., 677 F.2d 1301, 1306 (9th Cir. 1982). The court must construe all facts in favor of the non-moving party. Anderson, 477 U.S. at 255.

The party opposing summary judgment must go beyond the pleadings to designate specific facts establishing a genuine issue for trial. Celotex, 477 U.S. at 324; Marks v. United States, 578 F.2d 261, 263 (9th Cir. 1978) (genuine issues are not raised by mere conclusory allegations). The non-moving party may do this by use of affidavits (including his own), depositions, answers to interrogatories and admissions. Celotex, 477 U.S. at 323-24. Summary judgment is required against a party who fails to make a showing sufficient to establish an essential element of a claim, even if there are genuine factual disputes regarding other elements of the claim. Celotex, 477 U.S. at 322-23. There is no issue for trial "unless there is sufficient evidence favoring the non-moving party for a jury to return a verdict for that party." Anderson, 477 U.S. at 249.

III. FALSE CLAIMS ACT, 31 U.S.C. § 3729, ET SEQ.

Defendant' Motions focus almost entirely upon Count 1 of Trice's and Carbaugh's Complaints. This Count alleges that the Defendants made false or fraudulent claims for payment to the United States in violation of the False Claims Act, 31 U.S.C. § 3729(a)(1) and (2). This section states in relevant part:

(a) Any person who (1) knowingly presents, or causes to be presented, to an officer or employee of the United States Government . . . a false or fraudulent claim for payment or approval; [or] (2) knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the Government . . . is liable to the United States Government for [a civil penalty plus treble damages]. 31 U.S.C. § 3729(a)(1) and (2). "Knowingly" is defined as actual knowledge of the information, or deliberate ignorance or reckless disregard of the truth or falsity of the information, presented to the Government. 31 U.S.C. § 3729(b).

A false certification of compliance with a law, rule or regulation creates liability when the certification is a prerequisite to obtaining payment. U.S. ex rel. Hopper v. Anton, 91 F.3d 1261, 1266 (9th Cir. 1996), cert. denied, 519 U.S. 1115 (1997); see, also, United States ex rel. Thompson v. Columbia/HCA Healthcare Corp., 125 F.3d 899, 902 (5th Cir. 1997) ("where the government has conditioned payment of a claim upon a claimant's certification of compliance, . . . a claimant submits a false claim when he or she falsely certifies compliance"). The claim or false certification must contain "falsities made with scienter." See Hooper, 91 F.2d at 1265.

A private party may bring a civil action under § 3729 on behalf of themself and the United States Government after the Government has been properly presented with the complaint and declines to intervene. 31 U.S.C. § 3730(b). However, a person may not "bring an action under subsection (b) which is based upon allegations or transactions which are the subject of a civil suit or an administrative civil money penalty proceeding in which the Government is already a party." 31 U.S.C. § 3730(e)(3). Additionally, a court does not have jurisdiction over a qui tam claim in certain situations:

(A) No court shall have jurisdiction over an action under this section based upon the public disclosure of allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, or Government (General) Accounting Office report, hearing, audit, or investigation . . . unless . . . the person bringing the action is an original source of the information.

(B) For purposes of this paragraph, "original source" means an individual who has direct and independent knowledge of the information on which the allegations are based and has voluntarily provided the information to the government before filing an action under this section which is based on the information.

31 U.S.C. § 3730(e)(4).

IV. MOTIONS TO DISMISS PURSUANT TO RULE 12(b)(1): PRIOR PUBLIC DISCLOSURE

All Defendants argue that prior public disclosure of the information and allegations in Plaintiffs' Complaints eliminates this Court's subject matter jurisdiction. WHC and BCSR argue that Plaintiff Carbaugh's Second Amended Complaint publicly disclosed the allegations in Plaintiff Trice's Second Amended Complaint. Additionally, FDH alleged two Defense Contract Audit Agency audits of FDH's accounting system were conducted and publicly disclosed prior to Plaintiff Carbaugh's Second Amended Complaint. FDH believed this Complaint was the first one naming FDH.

A qui tam plaintiff bears the burden of establishing subject matter jurisdiction by a preponderance of the evidence. See, e.g., United States ex rel. Biddle v. Bd. of Trustees of the Leland Stanford Jr. University, 161 F.3d 533, 540 (9th Cir. 1998), cert. denied, ___ U.S. ___, 119 S.Ct. 1457 (1999). To defend a motion to dismiss, a plaintiff must make a prima facie showing of jurisdictional facts. Lake v. Lake, 817 F.2d 1416, 1420 (9th Cir. 1986). The FCA eliminates a court's subject matter jurisdiction in certain circumstances:

(A) No court shall have jurisdiction over an action under this section based upon the public disclosure of allegations or transactions in a criminal, civil, or administrative or Government Accounting Office report, hearing, audit, or investigations, or from the news media, unless the action is brought by the attorney general or the person bringing the action is an original source.

31 U.S.C. § 3730(e)(4).

Information disclosed through civil litigation and on file with the clerk's office is a public disclosure for purposes of 31 U.S.C. § 3730(e)(4)(A). United States ex rel. Siller v. Becton Dickinson Co., 21 F.3d 1339, 1350-51 (4th Cir. 1994). Once public disclosure of information occurs, any subsequent action is "based upon" the publicly disclosed information. Biddle, 161 F.3d at 539-40. The Ninth Circuit consciously chose this interpretation of "based upon," rather than interpreting "based upon" to mean the relator's allegations must be derived from the prior public disclosure to preclude jurisdiction. Id. at 536-39. A "derived from" approach is too narrow — it would allow an opportunistic plaintiff to bring an unnecessary qui tam suit simply by alleging that his allegations were derived from something other than the public disclosure. Id.

"[I]f at the time a relator files a qui tam complaint, the allegations or transactions of the complaint have been publicly disclosed, then the allegations are "based upon" the publicly disclosed information, and the relator must show that he is an original source of the information in order for a district court to have jurisdiction over the lawsuit." Biddle, 161 F.3d at 539. An "original source" is someone "who has direct and independent knowledge of the information on which the allegations are based, and has voluntarily provided the information to the Government before filing an action under this section which is based on the information." 31 U.S.C. § 3730(e)(4)(B); Wang v. FMC Corp., 975 F.2d 1412, 1417 (9th Cir. 1992). The Ninth Circuit recognizes four elements that a plaintiff must show to satisfy the original source requirement: (1) the plaintiff "had a hand" in the public disclosure of the allegations that are part of his suit; (2) the plaintiff's knowledge is independent; (3) the plaintiff's knowledge is direct; and, (4) the plaintiff voluntarily provided the government with the information prior to filing his action. United States v. Alcan Elec. Engineering Co., 197 F.3d 1014, 1020 (9th Cir. 1999), citing United States ex rel. Aflatooni v. Kitsap Physician Services, 163 F.3d 516, 525 (9th Cir. 1999); United States ex rel. Devlin v. California, 84 F.3d 358, 360 n. 3 (9th Cir. 1996). See also Wang, 975 F.2d at 1418.

Someone else's public disclosure does not rob a plaintiff of his own independent knowledge. Id. Also, the Ninth Circuit has interpreted "voluntary disclosure" as requiring a qui tam plaintiff to "directly or indirectly [have] been a source to the entity that publicly disclosed the allegations on which a suit is based." Wang, 975 F.2d at 1418, citing United States ex re. Dick v. Long Island Lighting Co., 912 F.2d 13, 16 (2nd Cir. 1990). The focus on the disclosure of the allegations or transactions, rather than of the information underlying them, is a rarely necessary but nonetheless important distinction. Id.; 31 U.S.C. § 3730 (e)(4). When the public knows of information proving an allegation, it necessarily knows of the allegation itself. Id. However, an allegation may be made public even if its proof remains hidden. Id. Overall, the history of the FCA makes clear that qui tam jurisdiction was meant to extend only to those who had played a part in publicly disclosing the allegations and information on which their suits were based. Id. Trice Complaint. Plaintiffs' allegations were publicly disclosed when their original joint complaint was unsealed on April 22, 1998. BCSR and WHC argue that Plaintiff Carbaugh's Second Amended Complaint filed April 6, 1999, was a prior public disclosure that precludes Trice's Second Amended Complaint. See, e.g., Alcan, 197 F.3d at 1019-20 (holding that a complaint in a previously filed action constituted a public disclosure of allegations in a later qui tam action).

Trice's Second Amended Complaint is an amended complaint. It is under the same cause number as the initial public disclosure in which Trice undisputedly had a hand The original joint Complaint, which named both WHC and BCSR as Defendants, delineates eight pages of allegations relating to false application of fringe benefit rates to overtime labor, fraudulent fee proposals, and fraudulent cost savings initiatives and incentive fees. Carbaugh's Second Amended Complaint delves into these allegations in greater detail, and includes more supporting information. Nonetheless, Trice's participation in the original Complaint (the first public disclosure) establishes he played a part in the public disclosure of the allegations. Trice may also have been a source to Carbaugh and Carbaugh's Second Amended Complaint. However, the Court need not find that Trice was a source for Carbaugh's Second Amended Complaint to find that he had a hand in the public disclosure of the allegations. "[A]ll those who 'directly or indirectly' disclose an allegation might qualify as its original source." Wang, 975 F.2d at 1419, citing Dick, 912 F.2d at 18.

Trice's Second Amended Complaint is not an unrelated, new action as contemplated by the ban created by public disclosure provisions. The prior public disclosure arguments do not apply to Trice's Second Amended Complaint. Instead, Trice's current Complaint is a continuation of the original joint Complaint.

Carbaugh's Complaint. FDH originally argued that Carbaugh joined FDH as a Defendant after two Defense Contract Audit Agency [DCAA] audits were publicly disclosed, and the audits preclude Carbaugh from joining FDH as a Defendant. In response, Carbaugh asserts that FDH was named in the First Amended Complaint, filed under seal on April 16, 1997. Furthermore, Carbaugh asserts he was involved in preparing the first DCAA audit report.

FDH was indeed named as a Defendant in Carbaugh and Trice's Joint Amended Complaint filed April 16, 1997. Ct. Rec. 24. FDH's Motion makes no mention of this Amended Complaint. In its reply, FDH withdraws its prior public disclosure argument. A review of the docket shows that Carbaugh twice successfully moved for an extension of the Fed.R.Civ.P. 4(m) time limit for service of the Complaint on Defendants after this Court's April 22, 1998 Order unsealed the Complaint. There is no summons or return of service executed upon any Defendant until after the Second Amended Complaint was filed and served. Ct. Recs. 62, 63. FDH was simply unaware that it was named in a previous complaint — while the original Complaint is listed as unsealed in the docket, the Amended Complaint is not listed as unsealed.

The Court notes that Plaintiffs filed the action against FDH prior to the earliest public disclosure that FDH alleges. The allegations in the First Amended Complaint are less detailed than those in Carbaugh's Second Amended Complaint, but the core allegations remain the same. Thus, the Court need not reach the question of whether Carbaugh was an original source because he played a part in the initial public disclosure of the allegations. Also noteworthy is that a DCAA auditor asked Carbaugh to assist him with the first audit of FDH. Decl. of Jeffrey Sprung, Exh. U. Carbaugh participated in the first public disclosure alleged by FDH.

V. MOTION TO DISMISS PURSUANT TO RULE 12(b)(1): POLITICAL QUESTION DOCTRINE

FDH asserts that this Court's subject matter jurisdiction over Mr. Carbaugh's Complaint is precluded for another reason: Carbaugh's allegations that FDH "padded" its budget submissions to the DOE and Congress present a non-justiciable political question. Because FDH's budget estimate submissions were presented by the DOE to Congress and ultimately to the President, FDH argues that the allegations in Carbaugh's Complaint ask this Court to inquire into the decision-making processes and budget allocations of Congress.

The Political Question Doctrine assumes there are certain questions that are inherently non-justiciable, and that courts lack jurisdiction to review these matters. The Doctrine excludes from judicial review "those controversies which revolve around policy choices and value determinations constitutionally committed for resolution to the halls of Congress or the confines of the Executive Branch." Japan Whaling Assn. v. American Cetacean Society, 478 U.S. 221, 230 (1986). Conversely, "one of the judiciary's characteristic roles is to interpret statutes," and the potential political implications a statutory interpretation or decision may have do not limit this responsibility. Id.

The standard for evaluating whether an issue presents a non-justiciable political question is long established. At least one of the following factors must be inextricably present in order for the Political Question Doctrine to apply: (1) a textually demonstrable constitutional commitment of the issue to a coordinate political department; (2) a lack of judicially discoverable and manageable standards for resolving it; (3) impossibility of deciding an issue without an initial policy determination of a kind clearly for non-judicial discretion; (4) impossibility of a court undertaking independent resolution without expressing lack of respect due coordinate branches of government; (5) an unusual need for unquestioning adherence to a political decision already made; or, (6) the potential of embarrassment from multifarious pronouncements by various departments on one question. Baker v. Carr, 369 U.S. 186, 217 (1962).

None of these factors are present in the instant case. Carbaugh's Complaint asks the Court to determine whether the Defendants violated the FCA. The FCA is a statute, the interpretation of which is soundly within the Court's purview. Specifically, under Count 1, Carbaugh asks the Court to determine whether Defendants submitted "a false or fraudulent claim for payment or approval" or "knowingly [made] a false record or statement to get a false or fraudulent claim paid or approved by the government." 31 U.S.C. § 3729(a)(1) and (2). The Court's inquiry examines Defendants' knowledge and actions. To determine liability under the FCA, the Court need look no further than Defendants' interactions with the DOE (i.e., draw-downs on the letter of credit and allegedly improper, certified budget estimate submissions). Analysis under the FCA stops at the point at which Defendants presented an allegedly false claim. The process by which Defendants' submissions proceeded from the DOE to Congress, how Congress evaluated those submissions, or how Congress allocated funds to the Hanford Project are beyond the scope of this Court's inquiry. Therefore, Carbaugh's Third Amended Complaint does not present a non-justiciable political question.

VI. MOTIONS TO DISMISS PURSUANT TO RULE 12(b)(1): STANDING FOR PRO SE QUI TAM PLAINTIFFS

WHC and BCSR both argue that Trice may not pursue a qui tam claim pro se because the Government is the real party in interest. A pro se litigant may only represent himself. Defendants' arguments present a novel question: May a pro se plaintiff proceed with a qui tam action when the Government chooses not to intervene?

Either the Attorney General or a private person may bring a civil FCA action. 31 U.S.C. § 3730(a) and (b). A private party may bring the action "for the person and for the United States government." 31 U.S.C. § 3730(b). "The action shall be brought in the name of the government." Id. A private person must file his complaint in camera and serve it upon the government. 31 U.S.C. § 3730(b)(2). It is then the Government's option to "proceed with the action, in which case the action shall be conducted by the government" or to "notify the court that it declines to take over the action, in which case the person bringing the action shall have the right to conduct the action." 31 U.S.C. § 3730(b)(4) (A) and (B). While a qui tam plaintiff has an interest in an FCA action, the government clearly has priority as a plaintiff. For example, the government is not bound by any action of the person bringing the suit, may dismiss the action not withstanding the objections of the private plaintiff, and may settle the action notwithstanding the objections of the private plaintiff. 31 U.S.C. § 3730(c).

Generally, courts view a relator as an agent for the Government in an action brought under the qui tam provisions of the FCA because the Government is the real party in interest. United States ex rel. Hyatt v. Northrup Corp., 91 F.3d 1211, 1215 (9th Cir. 1996) (citations omitted). Additionally, the Ninth Circuit has held in great detail "that the FCA effectively assigns the government's claims to qui tam plaintiffs . . . who then may sue based upon an injury to the federal treasury." United States ex rel. Kelly v. The Boeing Co., 9 F.3d 743, 748 (9th Cir. 1993), cert. denied, 510 U.S. 1140 (1994) (holding that qui tam plaintiffs have Article III standing). The Court adopted an assignment theory of qui tam actions by holding that several courts have embraced an assignment theory, federal courts routinely find fraud claims are assignable, and federal courts consistently recognize that an assignee of a fraud claim can assert the claim. Id. The court was unconcerned that the FCA statute does not use the term 'assignment," that the government retains the right to intervene, that the government's claim is contingent on a qui tam plaintiff filing suit, or that the qui tam plaintiff is assigned only part of the government's claim. Id. "If the government declines to prosecute the alleged wrongdoer, the qui tam plaintiff effectively stands in the shoes of the government." Id. The government's right to intervene is interpreted as a conditional assignment. Id. In sum, the Ninth Circuit held "Congress intended to assign the government's fraud claims to individual qui tam plaintiffs in cases where the government itself chooses not to pursue such claims." Id.

Defendants argue that a non-lawyer may not represent any person or entity other than himself. See Rowland v. California Mens Colony, 506 U.S. 194, 201-03 (1993). This principle is true as a general matter, and is stated in the cases cited by Defendants. However, Rowland and the many other cases cited by Defendants focus on established rules and statutory bars prohibiting corporations, partnerships, or associations appearing in federal court through someone other than a licensed attorney. See, e.g., In Re America West Airlines, 40 F.3d 1058, 1059 (9th Cir. 1994); United States v. High Country Broadcasting Co., 3 F.3d 1244, 1245 (9th Cir. 1993), cert. denied, 513 U.S. 826 (1994). Defendants assert that the policy arguments that support precluding pro se individuals from appearing on behalf of corporations also apply to qui tam actions. See Jones v. Niagara Frontier Transportation Authority, 722 F.2d 20, 22 (2nd Cir. 1983) (noting "that the conduct of litigation by a non-lawyer creates unusual burdens not only for the party he represents but as well as for his adversaries and the court").

Defendants' concerns are well-founded. Qui tam cases, like the instant one, frequently involve complex factual and legal issues. A licensed attorney is best equipped to present arguments surrounding these issues to the Court and opposing counsel. However, the FCA meticulously addresses the procedure by which a qui tam plaintiff may bring an action. Congress easily could have inserted a provision requiring a qui tam plaintiff to retain counsel. Congress even could have forsaken qui tam plaintiff standing altogether, deciding instead that only the Attorney General can properly bring an FCA claim on behalf of the Government. Congress did neither of these. Qui tam plaintiffs are accorded standing under the FCA, and their participation is described in such a way that it is easily interpreted as an assignment of a fraud claim by the Government to a private plaintiff. The Court finds the analysis in Kelly most applicable to the instant case. Kelly directly addresses a qui tam plaintiff's standing, and holds the basis for that standing is the assignment of a fraud claim. That characterization is critical because a corporation may not assign its claim to a lay person proceeding pro se. Jones, 722 F.2d at 23. Also, case law and statutes prohibit a corporation's claims from being pursued by a pro se individual. No such bar exists for the Government's claims. The analysis in Kelly is more appropriate to the instant case than Defendants' analogy to rules regarding representation of corporations.

Defendants also cite an Eighth Circuit Court of Appeals decision from 1951:

[W]e do not think that Congress could have intended to authorize a layman to carry on [an FCA] suit as attorney for the United States, but must have had in mind that such a suit would be carried on in accordance with the established procedure which requires that one licensed to practice law may conduct proceedings in court for anyone other than himself.

United States v. Onan, 190 F.2d 1, 6 (8th Cir.), cert. denied, 342 U.S. 869 (1951). This holding was based on the old FCA, 31 U.S.C. § 232. The FCA subsequently has been amended five times. Also, this decision was rendered far before the Ninth Circuit finding that an FCA claim is an assignable fraud claim. Citing Onan, another court held as dicta that a qui tam action filed by a pro se litigant should be dismissed unless an attorney is retained. Safir v. Blackwell, 579 F.2d 742, 745 n. 4 (2nd Cir. 1978), cert. denied, 441 U.S. 943 (1979). This dicta is not binding on this Court.

Assignment of a claim places the assignee in the shoes of the assignor. Essentially, the claim becomes the assignee's claim. An assignee may litigate his own claim if he wishes. In light of the Ninth Circuit's view that FCA claims are fraud claims assigned by the Government to the private litigant when the Government declines to intervene, Trice is allowed to proceed pro se.

VII. MOTION TO DISMISS PURSUANT TO RULE 12(b)(6): STATUTE OF LIMITATIONS

WHC also filed a Motion to Dismiss Claims in Count 1 of Carbaugh's Third Amended Complaint Predating March 19, 1999 as prohibited by the statue of limitations.

The FCA establishes time limitations within which an action must be brought. A civil FCA action may not be brought:

(1) More than 6 years after the date on which the violation of § 3729 is committed, or

(2) more than 3 years after the date when facts material to the right of the action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date on which the violation is committed,

whichever occurs last.

31 U.S.C. § 3731(b)(1) and (2). The Ninth Circuit has held that the tolling provision applicable to an "official of the United States charged with responsibility to act in the circumstances" in § 3731(b)(2) also may apply to a qui tam plaintiff. United States ex rel. Saaf v. Lehman Bros., 123 F.3d 1307, 1307 (9th Cir. 1997); Hyatt, 91 F.3d at 1216. Other courts have found that the tolling provision does not apply to qui tam plaintiffs. United States ex rel. Amin v. George Washington University, 26 F. Supp.2d 162, 172-73 (D.D.C. 1998).

This Court need not address whether the tolling provision applies to Carbaugh. Carbaugh's own Complaint alleges knowledge of FCA violations more than three years prior to the filing of the original Complaint on March 19, 1996. For example, Carbaugh alleges that he "attempted to disclose the fraud to external government sources" in 1991. Third Amended Compl. at ¶ 114. Carbaugh also alleges he notified a DOE staff accountant and others outside of WHC "of improperly applied overhead rates charged by WHC" in July, 1992. Id. at ¶¶ 115 and 116. Carbaugh's own allegations show that he knew of allegedly fraudulent acts committed by Defendants more than three years prior to filing this action.

Carbaugh argues that applicability of an equitable tolling provision, such as the FCA's provision, is not appropriate for determination on a Rule 12(b)(6) motion and that, at a minimum, Carbaugh is entitled to discovery to prove he is entitled to the tolling period. However, the allegations in his Complaint preclude any reasonable argument that the tolling provision would apply. Cf. Supermail Cargo, Inc. v. United States, 68 F.3d 1204, 1206 (9th Cir. 1995). While equitable tolling periods normally may be inappropriate for a 12(b)(6) motion, such is not the case here. The six year statute of limitations applies to Carbaugh's Third Amended Complaint. Therefore, any claims of FCA violations by Defendants prior to March 19, 1990 are time-barred.

VIII. MOTIONS TO DISMISS: INSUFFICIENCY OF SERVICE OF PROCESS

WHC and BCSR both argue that Trice's Second Amended Complaint should be dismissed for insufficiency of service of process because service was untimely and was not effected on an appropriate agent. They further argue that his egregious errors in this regard support a dismissal with prejudice. BCSR also argues that Trice's attempt to serve BCSR by mail is inadequate even if it were timely because special service requirements attach to service upon corporations.

Fed.R.Civ.P. 12(b)(2) and 12(b)(5) allow an action to be dismissed for lack of jurisdiction over the person or for insufficiency of service of process, respectively. "A federal court is without personal jurisdiction over a defendant unless the defendant has been served in accordance with Fed.R.Civ.P. 4." Benny v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986), cert. denied, 484 U.S. 870 (1987), citing Jackson v. Hayakawa, 682 F.2d 1344, 1347 (9th Cir. 1982). Fed.R.Civ.P. 4 provides that "[a] summons shall be served together with a copy of the complaint. The plaintiff is responsible for service of a summons and complaint within the time allowed under subdivision (m). . . ." FED. R. CIV. P. 4(c)(1). Service of the summons and complaint must be made upon a defendant within 120 days after the filing of the complaint. Id. at 4(m). Failing that, the Court "shall dismiss the action without prejudice as to that defendant or direct that service be effected within a specified time" upon motion by a party. Id. If the Plaintiff shows good cause for the failure, the Court shall extend the time for service for an appropriate period. Id.

To avoid costs of serving the summons, "the plaintiff may notify . . . a defendant of the commencement of the action and request that the defendant waive service of a summons." FED. R. CIV. P. 4(d)(2). The notice and request shall be in writing, addressed to an officer or appropriate agent of a corporate defendant, dispatched through first class mail or other reliable means, accompanied by a copy of the complaint, and shall allow the defendant a reasonable time to return the waiver (at least 30 days from the date on which the request is sent). Id. If a waiver of service is not obtained from a corporation, service shall be effected pursuant to local law, or by delivering a copy of the summons and complaint to an appropriate officer or agent of the company and by also mailing a copy to the defendant if the statute authorizing the agent to receive service so requires. FED. R. CIV. P. 4(h)(1).

Rule 4 is a flexible rule that should be liberally construed if a party receives sufficient notice of the complaint; however, neither "actual notice nor naming the defendant in the complaint provides personal jurisdiction without substantial compliance with Rule 4." Benny, 799 F.2d at 492 (citations omitted). Dismissal based on failure to comply with Rule 4 generally is not justified absent a showing of prejudice. United Food Commercial Workers Union Locals 197, 373, 424, 588, 775, 839, 870, 1119, 1179 and 1532 v. Alpha-Beta Co., 736 F.2d 1371, 1382 (9th Cir. 1984). Thus, dismissal of a complaint is not required in every instance where there is a failure to comply with Rule 4(d)'s technical requirements. Borzeka v. Heckler, 739 F.2d 444, 446 (9th Cir. 1984); see, also, Whale v. United States, 792 F.2d 951 (9th Cir. 1986). Failure to comply with Rule 4(d) is excusable and does not require dismissal of the complaint if the following four factors are present:

(a) the party that had to be served personally received actual notice, (b) the defendant would suffer no prejudice from the defect in service, (c) there is a justifiable excuse for the failure to serve properly, and (d) the plaintiff would be severely prejudiced if his complaint was dismissed.

Borzeka, 739 F.2d at 447. A factor a court may consider when determining whether there was a justifiable excuse for failure to serve properly is a plaintiff's pro se status. Id. at 448 fn.2.

The lengthy, detailed Motions and briefs submitted by both WHC and BCSR in relation to Trice's Second Amended Complaint show the parties who had to be served personally received actual notice of Trice's suit. While both Defendants state generally that they were prejudiced by Trice's technically improper service, neither Defendant argues any specific instance or example of prejudice. The Court also notes that Trice is a pro se Plaintiff, and made a good faith attempt to properly serve Defendants by inquiring at the District Court Executive's office about how to effect service. While reliance upon employees of the District Court Executive for substantive legal advice is not an excuse, see, e.g., Strock v. VanHorn, 919 F. Supp. 172, 173 (E.D. Pa. 1996), the office is a natural place to which a pro se plaintiff might turn for instructions about how to serve a party. Finally, it appears Trice could raise arguments addressing severe prejudice if his Complaint were dismissed. The Court notes that, assuming arguendo Trice's Complaint were dismissed pursuant to Rule 4, such dismissal would be without prejudice. A dismissal with prejudice is not warranted on a non-substantive issue such as failure to technically comply with Rule 4, and Rule 4 does not contemplate a dismissal with prejudice. Thus, the Court finds that WHC and BCSR received sufficient notice of Trice's Complaint, that they made no showing of prejudice, and that Trice's Complaint is deemed served on WHC and BCSR.

VIII. BCSR'S MOTION TO DISMISS COUNT 1 OF TRICE'S COMPLAINT

Count 1 of Trice's Second Amended Complaint alleges that WHC and BCSR violated the False Claims Act, 31 U.S.C. § 3729 (a)(1) and (2). BCSR argues that Trice wholesale copied Carbaugh's Second Amended Complaint. Since Carbaugh's Second Amended Complaint was against WHC and FDH, not BCSR, Trice's copying results in allegations against BCSR insufficient to meet Rule 9(b) specificity requirements. In response, Trice alleges that BCSR was a full participating bid partner with WHC in a 1986-87 management contract bid. He also argues "they were intimately aware of over-liquidation status" and requested and received payment knowing that the reporting of their activities was distorted and incorrect. Plaintiff's Memorandum in Opposition to Defendants' Motions to Dismiss Plaintiff Trice's Second Amended Complaint at 7.

Federal Rule of Civil Procedure 9(b) provides that "[i]n all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity. Malice, intent, knowledge and other condition of mind of a person may be averred generally." A pleading is sufficient under Rule 9(b) if it identifies the circumstances of the alleged fraud such as the time, place, and nature of the alleged fraudulent activities. Moore v. Kayport Package Express, Inc., 885 F.2d 531, 540 (9th Cir. 1989) citing Wool v. Tandem Computers, Inc., 818 F.2d 1433, 1439 (9th Cir., 1987). Rule 9(b) is properly applied to FCA actions because such matters involve claims of fraud. United States ex rel. Roby v. Boeing Co., 184 F.R.D. 107, 109 (S.D. Ohio 1998). Furthermore, "numerous courts have applied Rule 9(b)'s particularity requirement, without modification, in addressing a motion to dismiss a qui tam complaint under Rule 9(b)." California ex rel. Mueller v. Walgreen Corp., 175 F.R.D. 631, 636 (N.D. Cal. 1997) (citations omitted). Where more than one defendant is named, Rule 9(b) mandates that the fraudulent activity of each defendant be identified with particularity. Lancaster Comm. Hospital v. Antelope Valley Hospital, 940 F.2d 397, 405 (9th Cir. 1991), cert. denied, 502 U.S. 1094 (1992). If the plaintiff requests leave to amend, such leave should be granted with "extreme liberality." Morongo Band of Mission Indians v. Rose, 893 F.2d 1074, 1079 (9th Cir. 1990).

Trice copied all of Carbaugh's Third Amended Complaint with virtually no substantive change. Carbaugh's Third Amended Complaint refers generally to "Defendants" when describing his allegations against WHC and FDH. The general term "Defendants" works well for Carbaugh because both WHC and FDH were prime contractors at Hanford and served in the exact same role. In fact, FDH assumed all of WHC's accounting systems at issue. However, BCSR was a subcontractor, a fact that Trice recognizes. Trice Opposition at 6. No specific allegations are before the Court that BCSR had a direct contractual relationship with the government or that it directly submitted claims for payment to the Government. Therefore, BCSR may be liable under the FCA only with respect to its specific conduct that causes a prime contractor to submit a false claim. United States v. Bornstein, 423 U.S. 303, 309, 313 (1976). Specific conduct of a subcontractor must be alleged. Id.

BCSR correctly asserts that only three paragraphs in Trice's Second Amended Complaint mention it by name, excluding allegations pertaining to Trice's FCA retaliation and state law claims. Trice Compl. at ¶¶ 16, 71, 72. Trice's most specific allegation against BCSR is made in paragraph 16, when he states that "BCSR knowingly modified the FDS . . . for WHC to systematically over-estimate labor costs, and made false and fraudulent statements concerning the function of the FDS and the statements it produced [to federal agencies]." As discussed in Sections III and XI of this Order, an FCA claim may only address "a call upon the government fisc," which includes a direct claim for payment, underlying fraud tainting every claim for payment, or a statutorily-required false certification of accuracy that is a predicate to payment. Trice's general assertion that BCSR knowingly modified the FDS and made false and/or fraudulent statements concerning its function does not satisfy an FCA claim. The FCA does not address all possible illegal action, but rather only some form of a claim for payment. Trice does not allege that BCSR's modification resulted in a claim for payment being submitted to the Government by BCSR, nor that its alleged false and fraudulent statements were certifications required by statute as prerequisites to receive a contract or funds.

Trice's other two allegations against BCSR in relation to Count 1 have no legal import. Trice alleges WHC and BCSR submitted Cost Accounting Board Disclosure Statements in connection with each bid to receive a management contract. However, BCSR never received a management contract. BCSR was always a subcontractor. Also, Trice alleges BCSR collaborated with WHC in 1986 for its Consolidated Management Contract. Trice Compl. at ¶ 73. There is no relationship between BCSR's alleged collaboration with WHC and its potential liability under an FCA claim. Even if there were, the statute of limitations would preclude this claim. See, supra at § VII. Again, an FCA claim must allege a claim for payment, or a requisite certification as a predicate for a claim for payment, in order to succeed. Trice's Second Amended Complaint does not make any such allegations against BCSR with the specificity required by Rule 9(b).

IX. BCSR'S MOTION TO DISMISS COUNT 2 OF TRICE'S COMPLAINT

Count 2 of Trice's Second Amended Complaint alleges retaliation by WHC and BCSR against Trice in violation of the False Claims Act, 31 U.S.C. § 3730(h). BCSR argues that Trice does not tie any actions by BCSR to alleged retaliation for activities protected by the FCA, nor does Trice allege that BCSR knew he was furthering an FCA claim against BCSR. Therefore, Trice's claim should be dismissed pursuant to Fed.R.Civ.P. 12(b)(6). In response, Trice asserts that BCSR participated in retaliation by not warning Trice that a layoff of WHC/BCSR staff was forthcoming, and by laying off Trice while retaining someone less qualified than he.

The FCA provides in relevant part as follows:

Any employee who is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment by his or her employer because of lawful acts done by the employee on behalf of the employee or others in furtherance of an action under this section, including investigation for, initiation of, testimony for, or assistance in an action filed or to be filed under this section, shall be entitled to all relief necessary to make the employee whole.

31 U.S.C. § 3730(h).

A plaintiff must allege three elements to sustain a § 3730(h) claim: (1) the employee was engaging in conduct protected under the FCA, (2) the employer knew that the employee was engaging in such conduct, and (3) the employer discriminated against the employee because of his protected conduct. Hopper, 91 F.3d at 1269. A plaintiff must be investigating matters which are calculated or reasonably could lead to a viable FCA action in order to be protected against retaliation under the FCA. Id. Also, an employer must be aware that an employee is investigating fraud in order to be liable under the FCA — otherwise, the employer cannot possess the retaliatory intent required. Id. citing Robertson v. Bell Helicopter Textron, 32 F.3d 948, 952 (5th Cir. 1994), cert. denied, 513 U.S. 1154 (1995). Frequent written or oral complaints about a practice, or activism to encourage an employer to commence or cease a practice, is not equivalent to investigating fraud under the FCA. Hopper, 91 F.3d at 1269.

In the "History of Mr. Trice's Employment at Hanford" section of Trice's Second Amended Complaint, BCSR warrants only a mention. He merely identifies two BCSR employees who supervised him in the final position he held at Hanford. Trice Compl. at ¶ 105. In the subsequent "The Defendants' Harassment and Retaliation Against the Relator" section, Trice discusses WHC's and BCSR's alleged retaliation. Id. at ¶ 114-122. BCSR is named in only one paragraph in this section. Id. at ¶ 121. In this paragraph, Trice never alleges that BCSR knew he was investigating or planning an FCA claim. Trice alleges only one activity that might disclose to either employer that he was planning on revealing their financial information: On January 23, 1995, Trice wrote a letter to the Secretary of the Department of Energy stating that he planned to disclose information about "the discrimination and the financial integrity of WHC." Id. at ¶ 121. The letter was copied to several individuals, including the President of WHC. BCSR apparently neither was copied on nor mentioned in the letter, and the letter appears to be sent before Trice was employed by BCSR.² Trice's response to BCSR's Motion contains his most in-depth treatment of BCSR. However, his response simply alleges how BCSR participated in his retaliation. It offers no reason for retaliation.

2 Trice began his employment at BCSR sometime during 1995. Though unclear when, he began working for BCSR, in addition to his employment with WHC, sometime in the spring or summer of 1995.

The Plaintiff bears the burden of alleging the elements of a claim. A retaliation claim under the FCA has three elements. The second element, knowledge by the employer that the Plaintiff was engaging in conduct protected under the FCA, never is alleged against BCSR. Furthermore, the third element, that the employer discriminated against the employee because of his protected conduct, never is alleged. While Trice argues that BCSR engaged in discriminatory conduct, he presents no nexus between the discriminatory conduct and any actions taken in pursuit of an FCA claim. Accordingly, Count 2 of Trice's Second Amended Complaint is dismissed under Rule 12(b)(6).

BCSR argues that this Court should decline to exercise supplemental jurisdiction over the state law claims alleged in Trice's Second Amended Complaint if the claims arising under federal law are dismissed. Counts 1 and 2 of Trice's Complaint, as relating to BCSR, are dismissed.

Supplemental jurisdiction allows a federal district court with original jurisdiction over a matter to consider closely related claims arising under state law. The relevant statute provides as follows:

[I]n any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties.

28 U.S.C. § 1367(a). It is within a district court's discretion to decline to exercise supplemental jurisdiction in several instances, including when a claim raises a novel or complex issue of state law, a claim substantially predominates over the claims over which the district court has original jurisdiction, the district court has dismissed all claims over which it has original jurisdiction, or when compelling reasons for declining jurisdiction arise in exceptional circumstances. 28 U.S.C. § 1367(c).

Pendent party jurisdiction is included in supplemental jurisdiction. It allows a federal court to hear claims against additional parties over whom it otherwise would not have jurisdiction because the claims arise from a common nucleus of operative fact as the claims over which the court has original jurisdiction. Pendent party jurisdiction is specifically contemplated by § 1367(a): "Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties."

Here, the federal law claims against BCSR are dismissed. The dismissals deprive this Court of original jurisdiction over BCSR. However, the Court has original jurisdiction over Trice's federal law claims against WHC, one of which is the FCA retaliation claim that arises from a common nucleus of operative fact with the state law claims against BCSR. The intensive focus on the FCA claims by all parties to date indicates federal, rather than state, law concerns dominate. The Court finds no complex state law issues or exceptional circumstances exist to support declining to exercise supplemental jurisdiction. Indeed, § 1367 and the interests of judicial economy support exercise of this Court's supplemental jurisdiction over Trice's state law claims against BCSR.

IX. MOTION TO STRIKE DECLARATIONS OF JEFFREY SPRUNG

Defendants WHC and FDH jointly move to strike two Declarations by Carbaugh's counsel, Jeffrey Sprung. Declaration of Jeffrey T. Sprung pursuant to Fed.R.Civ.P. 56(f) and in Opposition to Defendants' Motion for Partial Summary Judgment, Ct. Rec. 189; Declaration of Jeffrey T. Sprung in Support of Qui Tam Plaintiff's Memorandum in Opposition to Defendants' Motion to Dismiss, Ct. Rec. 99. Defendants argue that Mr. Sprung is an attorney who lacks personal knowledge of the documents attached to his Declarations — at best, the Declarations affirm the attachments are true and correct copies of what Mr. Carbaugh gave him. Since the Affidavits cannot authenticate the attached documents, the documents offered as exhibits do not satisfy the Rules of Evidence and may not be considered in support of Carbaugh's Opposition to the Defendants' Motions for Summary Judgment.

In response, Mr. Carbaugh submits a Declaration authenticating exhibits B through J and Q through T to the January 6, 2000 Sprung Declaration based on his personal knowledge. The Declaration also authenticates public documents taken from government web sites, which are admissible under Fed.R.Evid. 901(b)(7). Exhibits M through O. The Declaration authenticates Exhibit L as a document Carbaugh obtained from the FDH computer information system after his employment ceased. Carbaugh asks the Court to take judicial notice of the remainder of the attachments to the January 6, 2000 Sprung Declaration as official government records. Exhibits A, K and T. Finally, Carbaugh argues that paragraphs 23-25 of the January 6, 2000 Sprung Declaration do not introduce exhibits, but rather state the basis for Carbaugh's Rule 56(f) request for discovery. Defendants have no basis for striking these paragraphs. Carbaugh does not separately oppose the Motion to Strike Mr. Sprung's August 9, 1999 Declaration. However, one document attached to the August 9, 1999 Declaration also is attached to the January 6, 2000 Sprung Declaration, and Carbaugh's Declaration attempts to authenticate it. Carbaugh argues the other document attached to the August 9, 1999 Declaration, the Form 2000 Suspected Irregularity Referral Form, is an official government report of which the Court can take judicial notice. Qui Tam Plaintiff Carbaugh's Memorandum in Opposition to Motion to Strike Declaration at 6.

The Court finds Exhibits B and C admissible pursuant to Fed.R.Evid. 901(b)(1) and 1003. The Court finds Exhibits D through J, Exhibit L, and Exhibits Q through S are admissible pursuant to Fed.R.Evid. 901(b)(1) and 801(d)(2)(A). Exhibits M through O also are admissible pursuant to Fed.R.Evid. 901(b)(7) and 801(d)(2)(A) and (C). The Court takes judicial notice pursuant to Fed.R.Evid. 201 of Exhibit P. Exhibits A, K, T and Exhibit A to the August 9, 1999 Sprung Declaration present a more difficult question. Exhibit T shall be discussed first.

Portions of Exhibit T are admissible. Bates Stamp Numbers 102001 through 102003, 102006 through 102011, 102013, 102017, 102018, the document immediately following Number 102018, and 102200 are documents of which Mr. Carbaugh has personal knowledge pursuant to Fed.R.Evid. 901(b)(1). All of these documents also appear admissible under Fed.R.Evid. 801(d)(2). However, Plaintiff Carbaugh argues that Bate Stamp Number 102004 of Document T, as well as Exhibits A, K, and the Form 2000 Referral, are documents of which it is appropriate this Court take judicial notice. Fed.R.Evid. 201(b) allows a court to take judicial notice of a fact that either is "generally known within the territorial jurisdiction of the trial court" or "capable of accurate and ready determination by resort to sources whose accuracy cannot be reasonably be questioned." These documents do not contain generally known facts, nor is the Court able to easily ascertain the accuracy of these documents. In his Complaint, Carbaugh himself questions the knowledge and accuracy of the DOE's Richland office. See, e.g., Carbaugh's Third Amended Complaint at ¶¶ 64, 69, 73. All documents of which Carbaugh requests the Court to take judicial notice are generated by the DOE's Richland office except for the Form 2000 Referral. None of these documents are official public records, nor do they bear signatures and seals that might certify their authenticity. The absence of signatures, seals, or indicia that these documents are authorized or required to be recorded as public records indicate that Fed.R.Evid. 803(8), 901(b)(7), and 902(b) do not apply. Therefore, the Court finds Mr. Carbaugh's and Mr. Sprung's Declarations insufficient to render Exhibits A, K, Bate Stamp Number 102004 of Exhibit T, and the Form 2000 Referral admissible. All other Exhibits and paragraphs 23-25 of Sprung's 1/6/00 Declaration shall be considered by the Court.

X. WHC'S MOTION FOR SUMMARY JUDGMENT AGAINST CARBAUGH'S THIRD AMENDED COMPLIANT — COUNT 1

WHC moves for summary judgment on Count 1 of Carbaugh's Third Amended Complaint on the grounds that WHC never used estimated labor costs, such as those generated by application of the Absence Adder, to obtain payment from the DOE. Through several affidavits, WHC declares that its labor costs incurred under its Hanford Management Contract were reimbursed through use of a letter of credit arrangement. See, e.g., Decl. of Ernest P. Vodney at ¶ 8. A special bank account established at U.S. Bank held the funds disbursed through the letter of credit. Id. This account had various designated sub-accounts, including a payroll account from which direct labor costs were paid. Id. WHC employees all submitted physical, and later electronic, timecards that reflected the employee's actual paid hours worked, including regular, overtime, vacation, sick leave, holiday, and other paid absence hours. Decl. of Janyce M. Shelt at ¶¶ 7(a) and 8. The payroll department calculated the net salary owed to an employee, as well as statutory withholdings and voluntary deductions, based upon these employee timecard submissions. Shelt Decl. at 7(b) through 7(c). The letter of credit was drawn down in an amount to cover only these actual payroll costs — the DOE paid WHC only its actual labor costs, represented by actual payroll costs, which did not include Absence Adder or other estimated calculations. Shelt Decl. at 7(e) through 7(h) and ¶ 6. This payroll system was the only method used by WHC to request or recover payment from the DOE for labor costs under the contract. Shelt Decl. at ¶ 5; Vodney Decl. at ¶ 10.

The Absence Adder was used as part of the Financial Data System at the Hanford site. Decl. of Richard A. Pouley at ¶ 6. The Financial Data System [FDS] used estimated costs, including estimated labor costs calculated in part by application of the Absence Adder, to evaluate a project's performance and to plan future work. Id. These estimated costs were separate from the payroll system, and were not used to draw down labor costs from the DOE letter of credit. Pouley Decl. at ¶ 6 and ¶ 14.

Carbaugh makes two arguments in response to the Motion and supporting Declarations. First, he argues that a Motion for Summary Judgment is inappropriate at this time because he did not have an opportunity for Fed.R.Civ.P. 56(f) discovery. Fed.R.Civ.P. 56 governs motions for summary judgment, and Rule 56(f) addresses one instance in which a court may refuse or continue a motion for summary judgment to permit various forms of discovery:

Federal Rule of Civil Procedure 56(f) allows, but does not require, a district court to grant a continuance when a party opposing summary judgment wishes to conduct further discovery. Ordinarily, summary judgment should not be granted when there are relevant facts remaining to be discovered, but the party seeking a continuance bears the burden to show what specific facts it hopes to discover that will raise an issue of material fact.

Continental Maritime of San Francisco, Inc. v. Pacific Coast Metal Trades District Council, 817 F.2d 1391, 1395 (9th Cir. 1987). In support of denying or continuing summary judgment, Carbaugh cites to several cases finding summary judgment inappropriate when the relevant facts were exclusively in the control of the opposing party and when a defendant had not answered pending discovery requests. Weir v. Anaconda Co., 773 F.2d 1073, 1081 (10th Cir. 1985); Visa International Service Assn. v. Bank Card Holders of America, 784 F.2d 1472, 1475 (9th Cir. 1986).

The Court makes two observations in light of Plaintiff's arguments. First, limited discovery was permitted by the Court prior to Defendants' summary judgment motions. On September 13, 1999, the Court held that "discovery in this matter shall be limited to information reasonably related to the calculation, application, and use of the Absence Adder" until January 19, 2000 (the date scheduled for oral argument on Defendants' Motions). September 14, 1999 Order, Ct. Rec. 122, at ¶ 6. The parties informed the Court that document discovery could include up to 15 million documents. Therefore, the Court prohibited requests for production of documents until March 1, 2000, but allowed all other permissible forms of discovery. Id. Defendants assert, and Plaintiff does not controvert, that Carbaugh did not engage in any discovery during the intervening four months. Therefore, Carbaugh's argument that he did not have an opportunity for Rule 56(f) discovery before summary judgment motions were filed is overstated. He had an opportunity to propound discovery regarding the calculation, application, and use of the Absence Adder — a key element to his complaint. The instant situation is unlike one in which discovery requests are pending when defendants file a summary judgment motion. In fact, permissible discovery was not attempted.

Second, qui tam litigation does not present a situation where the relevant facts are exclusively in control of the opposing party. Cf. Weir, 773 F.2d at 1081. Qui tam plaintiffs are allowed to bring suit on behalf of the government due to their unique "insider" knowledge. For example, a relator may not bring a suit based upon public disclosure. 31 U.S.C. § 3730 (e)(4) (A). Instead, a relator must be a "original source" who has direct and independent knowledge of the information on which the allegations are based. 31 U.S.C. § 3720(e)(4)(B). It is assumed that a qui tam plaintiff, while perhaps not possessing extensive documents or testamentary evidence, can declare facts in opposition to a motion for summary judgment from his own personal knowledge.

Carbaugh also argues that summary judgment is inappropriate because, even if the draw downs for labor costs submitted by the payroll department were accurate, they nonetheless constitute a false claim under the FCA because each claim for payment submitted under a fraudulently obtained contract is tainted. See United States, ex rel. Marcus v. Hess, 317 U.S. 537 (1943); United States v. Neifert-White, 390 U.S. 228 (1968).

In Marcus, the court considered a contract obtained through a collusive bidding scheme. Contractors in the Pittsburgh area conspired to rig bidding on certain projects by privately meeting to average the prospective bids that might have been submitted by each contractor, and choosing one contractor to submit a bid for an averaged amount while all others submitted higher estimates. Marcus, 317 U.S. at 539 fn.1. The court found that contracts awarded under this process were violations of the predecessor statute to the FCA because bidding for the contract was a federal requirement, and "many if not most of the respondents certified that their bids were 'genuine and not sham or collusive.'" Id. at 543. The court held:

The government's money would never have been placed in the joint fund for payment to respondents had its agents known the bids were collusive. By their conduct, the respondents thus caused the government to pay claims of the local sponsors in order that they might in turn pay respondents under contracts found to have been executed as the result of the fraudulent bidding. This fraud did not spend itself with the execution of the contract. Its taint entered into every swollen estimate which was the basic cause for payment of every dollar paid by [the government] into the joint fund for the benefit of respondents.

Id.

In the instant case, Carbaugh alleges that WHC submitted fraudulently increased budget projections for the Hanford project which increased the overall budget of the project. Like Marcus, required certifications made during the process of awarding the contract are allegedly fraudulent, tainting the entire contract. However, unlike Marcus, this taint did not enter into any "swollen estimates." All claims for payment under the type of collusive bidding scheme described in Marcus would be inaccurate. Each contractor had differing base costs. By averaging the costs of all bids, the contractors increased the amount of the lowest bid submitted to the Government. All costs under the contract were thereby increased. There is no evidence that that is the case here. Affidavits establish that the payroll draw downs were accurate, i.e., they were not improperly inflated. Carbaugh does not contest this fact. Qui tam Plaintiff Carbaugh's Response to Defendants' Statement of Material Fact at 2 ("Plaintiff does not allege that Defendants violated the False Claims Act by drawing down the fraudulently inflated budget monies to pay payroll or labor costs"). Rather, Plaintiff alleges WHC profited from fraudulent use of the Absence Adder "by shifting budgeted funds to avoid penalties or earned fees, by paying for unallowable costs, and by inflating its fees under the Hanford contract." Id. at 3. Essentially, Plaintiff alleges that improper claims were submitted under the letter of credit, and that WHC profited from its fraud by recovering incentive fees under the contract. There is no allegation that payroll draw downs, or other direct requests for payment, were "swollen."

The Fourth Circuit recently distinguished "false certification" cases, like the instant one, from "fraud in the inducement" cases. Harrison v. Westinghouse Savannah River Co., 176 F.3d 776 (4th Cir. 1999). False certification cases involve situations where receipt of a Government contract requires certification of compliance with certain conditions as a prerequisite to receipt. Id. at 786. Fraud in the inducement cases, on the other hand, involve fraudulent pricing such as collusive bidding and fraud surrounding the efforts to obtain the contract. Id. at 786-87, citing Marcus, 317 U.S. at 543. The instant case is a false certification case. WHC (and FDH) was required to submit an estimated budget under its Hanford Management Contract. Those budget submissions included requisite certifications, in the form of Disclosure Statements, that their accounting practices were in compliance with the Cost Accounting Standards Board standards. These certifications did not increase the price of individual services received under the contract. Rather, by certifying that the accounting system was accurate, Defendants allegedly submitted a false certification that allowed them to receive and keep the contract and, ultimately, to receive unwarranted fees on the back end. This allegedly false certification is one of the bases for FCA liability. However, this false certification would not increase the cost of individual labor cost reimbursements.

Accordingly, WHC's Motion for Summary Judgment is granted in part. The Court finds there are no material issues of fact relating to whether WHC used the Absence Adder to draw down the DOE letter of credit for payroll or labor costs. WHC is entitled to summary judgment as a matter of law on this narrow issue. All draw downs for labor costs are eliminated from this suit.

WHC moves for summary judgment on Count 1 of Trice's Second Amended Compliant on the same grounds as the Motion against Carbaugh's Complaint. Trice did not file appropriate opposition. However, he agreed entirely with Carbaugh's arguments and evidence, and adopted them at oral argument. WHC's Motion for Summary Judgment on Count 1 of Trice's Second Amended Complaint is granted and denied on the same grounds and for the same reasons as the Motion against Carbaugh's Complaint.

XI. FDH'S MOTION FOR PARTIAL SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, TO DISMISS PURSUANT TO RULE 12(b)(6)

FDH moves for summary judgment against Carbaugh's Third Amended Complaint on substantially the same grounds as WHC. FDH submits various affidavits declaring that it is reimbursed for its costs by drawing down a letter of credit established by DOE, that the payroll system does not use the Absence Adder, and that the payroll system requests draw downs for only actual labor costs incurred. Fluor's Statement of Undisputed Facts Pursuant to Local Rule 56 at ¶ 13, 20, 22. Again, Carbaugh does not contest these facts, conceding that the "Plaintiff does not allege that Defendants violated the Federal Claims Act by drawing down the fraudulently inflated budget monies to pay payroll or labor costs." Qui tam Plaintiff Carbaugh's Response to Defendants' Statements of Material Facts at 4.

Finding no material issues of fact regarding these particular allegations, the Court finds as a matter of law that FDH is entitled to summary judgment on this portion of Count 1 of Carbaugh's Third Amended Complaint. The Court finds there are no material issues of fact relating to whether FDH used the Absence Adder to draw down the DOE letter of credit for payroll or labor costs. All draw downs for labor costs are eliminated from this suit.

FDH argues several additional points in its Motion for Summary Judgment that are not raised by WHC. First, no one related to any of Defendants received Trice's complaint until November 4, 1999, three days after this Court's Order specified that any amended complaint be served. The same Order set all deadlines for motions to dismiss to be filed and served. Defendants lost time to prepare the motions.

Damages to the United States are Not Required to Proceed with a Suit. FDH briefly argues that Carbaugh cannot show any damages to the United States as a result of the alleged false claims, and therefore he cannot maintain an FCA claim. Ninth Circuit case law is to the contrary. One "who submits a false claim for payment may still be liable under the FCA for statutory penalties, even if it did not actually induce the Government to pay out funds or to suffer any loss." United States v. Rivera, 55 F.3d 703, 709 (9th Cir. 1995); see, also, United States ex rel. Hagood v. Sonoma County Water Agency, 929 F.2d 1416, 421 (9th Cir. 1991).

FDH cites a recent Supreme Court case as overruling these Ninth Circuit cases by holding that the imposition of penalties where the Government has not been harmed is violative of the Excessive Fines Clause of the Eighth Amendment of the Constitution. United States v. Bajakajian, 524 U.S. 321 (1998). However, Bajakajian was a criminal case in which a defendant pled guilty to failure to report exported currency, and the district court determined that the defendant was required to forfeit only a small fraction of the total improperly exported amount. The Court held that forfeitures are "fines" within the meaning of the Excessive Fines Clause if they constitute punishment for an offense. Bajakajian, 524 U.S. at ___, 118 S.Ct. at 2033. "The amount of the forfeiture must bear some relationship to the gravity of the offense that it is designed to punish" in order to comply with the Excessive Fines Clause. Id. at 2036 (citations omitted). In determining a constitutional excessiveness standard, the Court found that judgments about the appropriate punishment for an offense belong first to the legislature. Id. at 2037. Also, civil sanction may be considered punitive if it can be explained as serving in part to punish. Lewis v. Commissioner, 170 F.3d 1252, 1236 (9th Cir. 1999). Factors bearing on such a finding include the language of the applicable statute, the sanction's purpose(s), the circumstances in which the sanction can be imposed, and its historical context. Id. citing Bajakajian, 118 S.Ct. at 2033-35.

Congress established a "civil penalty" of not less than $5,000 and not more than $10,000 for each false claim in violation of the FCA in addition to treble actual damages. 31 U.S.C. § 3729(a). The language of the statute establishes the sanction for each false claim is a penalty. Unlike the mere "reporting violation" in Bajakajian, a violation of the FCA involves scienter and an affirmative act, i.e., submission of a claim. A more severe remedy appears appropriate. Congress determined that this was the proper penalty, and does not seem "grossly disproportional" to a defendant's violation.

Plaintiffs' inability to show damages sustained by the Government does not preclude an FCA claim. The Excessive Fines Clause and Bajakajian do not render the FCA civil penalty unconstitutional.

FDH next argues that, unlike WHC, it never earned "Base," "Award," or "Incentive" Fees under its Hanford Management Contract. Decl. of J.L. Jacobson at 3. While FDH always earned "Performance Fees" under its contract, the Complaint itself eliminates these fees from this action. Jacobson Decl. at 3; Carbaugh's Third Amended Complaint at ¶ 74 ("FDH can also earn additional 'Performance Fees' — not a part of this suit — based on meeting certain quality of performance benchmarks"). FDH argues that, since it did not receive any fee other than a Performance Fee, it is entitled to summary judgment on the portion of Count 1 that alleges excess fees were recovered under FDH's Management Contract. In response, Carbaugh cites to Exhibit M of the January 6, 2000 Sprung Declaration. This Exhibit is a January 12, 1999 modification to FDH's management contract. It allows FDH to recover Incentive Fees during the 1999 fiscal year. Citing this document, Carbaugh argues that the Jacobson Declaration is incorrect. Mr. Jacobson declared that "Fluor has never had any Cost Savings Program, nor earned any kind of Incentive Fees as a result of such a program, throughout its tenure as the prime contractor at the Hanford Reservation." Jacobson Decl. at ¶ 9.

It appears the parties are arguing over semantics, or over technical terminology specific to the contract. Clearly, they dispute what a "Performance Fee" is in relation to what fees FDH may have received. Exhibit M also calls into question what contract modifications may have occurred on this issue. These are material questions of fact. Summary judgment on these grounds is not appropriate.

FDH next argues that, since the Absence Adder is not used to actually draw down the letter of credit, there is no allegation of a false claim under the FCA. FDH focuses its argument on the requirement of a claim for payment. If a claim for payment is required, and the Absence Adder did not result in any claim for payment, then FDH argues there are no claims alleged under the FCA. FDH maintains that the Absence Adder is the focus of Carbaugh's Third Amended Complaint. Once it is established that the Absence Adder was not used as a claim for payment, Count 1 fails in its entirety. The alleged pool of excess money recovered by FDH under the contract could not exist and, as previously argued, FDH could not recover excess fees under the contract.

A "false or fraudulent claim" is construed more broadly than Defendants suggest. "[W]here the government has conditioned payment of a claim upon a claimant's certification of compliance with, for example, a statute or regulation, a claimant submits a false or fraudulent claim when he or she falsely certifies compliance with that statute or regulation." Thompson, 125 F.3d at 902. See, also, Hopper, 91 F.3d at 1266 (holding violations of laws, rules and regulations do not constitute an FCA violation, but false certifications of compliance with such laws in order to receive payment are a violation).

In the instant case, Carbaugh alleges that Defendants were required to submit Cost Accounting Standards Board Disclosure Statements describing Defendants' cost accounting system in order to receive and keep the Hanford Management Contract. See, 48 C.F.R. § 52.230-1, 52.230-2, and 9903.202-1; 10 U.S.C. § 2306(a). Carbaugh contends that Defendants submitted false certifications required under these regulations and statutes by certifying that the Absence Adder was based upon projections of historical absence averages for all employees. Carbaugh Third Amended Compl. at ¶¶ 85-87. Thus, the estimated budget was falsely certified to be accurate in relation to anticipated costs. Defendants also allegedly falsely claimed that the proper liquidation base for the Absence Adder is one that includes both regular and overtime costs. Id. at ¶ 90.

Defendants were required to submit disclosure statements prior to receiving the contract. 48 C.F.R. § 9903.202-1(b)(1) ("any business unit that is selected to receive a CAS-covered contract or subcontract of $25 million or more shall submit a Disclosure Statement before award"). There is no dispute that FDH was required to submit Disclosure Statements. By submitting and receiving approval on these certified Disclosure Statements, Defendants received approval of their accounting practices as required by regulation, and thus were eligible to be awarded the contract.

Granting summary judgment as to the use of the Absence Adder in relation to direct draw downs of the letter of credit does not eliminate all false claims alleged in Count 1 of the Complaint. A false certification allegedly allowed FDH to obtain the contract and recover excess fees. Also, Plaintiff alleges Defendants submitted claims for direct draw downs for unallowable costs.

FDH makes an additional argument regarding allegedly false certifications. It argues that it could not violate the Truth in Negotiations Act [TINA], 10 U.S.C. § 2306A, or the False Claims Act. Under the Truth in Negotiations Act, a defense to an alleged violation is that "the United States did not rely on the defective data submitted by the contractor." 10 U.S.C. § 2306A(e) (2). FDH argues that the Government could not have relied upon any defective data submitted by FDH because Carbaugh and Trice's original Complaint was filed in March, 1996, but FDH did not assume management of Hanford until October 1, 1996. Since the Government knew of the allegations regarding the Absence Adder and the accounting system at Hanford, it could not have relied upon submissions by FDH. Under the FCA, many courts have found that an element of liability for a false claim, or false statement in support of a claim, is whether the claim was material to the Government's decision to award the contract. For example, allegedly false statements made in connection with an application are not material if the Government knew of allegedly false statements made but decides to grant the application anyway. See United States ex rel. Lamers v. City of Green Bay, 168 F.3d 1013 (7th Cir. 1999). FDH argues these reliance and materiality factors cannot be present here.

The Lamers court considered similar false certifications of compliance with federal statutes. A public school district that previously contracted with a private bus line to provide school bus service for its students attempted to switch to use of public buses for student transportation. The public transit system received funding under the Federal Transit Act. In order to receive such funding, the city was required to certify it complied with all applicable statutes and regulations, including certifying that it did not provide school buses exclusively for transporting students and school personnel in competition with private school bus operators. Lamers, 186 F.3d at 1014; 49 U.S.C. § 5323(f). Early in the pilot program, the FTA was informed that certain bus routes were directly servicing schools in violation of certified compliance. During the next three years, the FTA and the City were in frequent communication regarding potential violations and on-going efforts to comply with federal regulations. The court found that alleged FCA certification violations were, in fact, "promises of future compliance that were knowingly false only if the city never intended to comply with the applicable regulations." Id. at 1018. Additionally, the court found that the government was fully apprised of the bus routes at issue, never complained about them, and that any untruths were immaterial. Id. at 1019. The Court characterized any violations as "minor technical violations." Id.

The instant case differs in several respects. The Disclosure Statements certified current accuracy, not future compliance. DOE was never "fully apprised" of the accounting system used by WHC and FDH, or any alleged problems with it. The only information in the Government's possession was Plaintiff's Complaint. The allegations in the original Complaint were much more conclusory than those currently before the Court, and the Government required two years to investigate the Complaint in order to determine whether it wished to intervene. FDH assumed management of Hanford on October 1, 1996, just over six months after the Complaint was filed. Also, FDH was not listed in the original Complaint. It is unclear to what extent the Government was aware of the alleged false certifications at the time FDH assumed management, and unclear whether the Government relied on FDH's certification that the accounting system was accurate. Some knowledge of what FDH was certifying can be imputed on FDH, and the Government may have assumed that changes were made if it was aware of the nature of the possible problem.

Reliance and materiality are questions of fact. There is insufficient evidence before the Court to evaluate what the DOE knew when FDH assumed management of Hanford. Summary judgment on this ground is not appropriate.

Finally, FDH argues it simply could not have committed an FCA violation by falsely inflating the Hanford budget. WHC submitted the cost estimates for fiscal year 1997, the first year of FDH's management. Jacobsen Decl. at ¶ 10. Furthermore, FDH worked with the DOE to establish a new accounting system for Hanford. Starting with fiscal year 2000, the Absence Adder is applied only to regular-time hours. Adamson Decl. at ¶ 6. The Court notes that FDH's declarations do not address fiscal years 1998 or 1999. The Court also notes that FDH allegedly signed Disclosure Statements relating to its Hanford Management Contract as early as July 21, 1995. Carbaugh's Third Amended Compl. at ¶ 83. FDH's offered facts do not preclude liability. Accordingly,

IT IS ORDERED that:

1. Defendant FDH's Motion for Waiver of Page Limitations, Ct. Rec. 177, is GRANTED. FDH's Motion for Summary Judgment, Ct. Rec. 165, and Motion to Dismiss Pursuant to Rule 12(b)(1), Ct. Rec. 173, are ACCEPTED AS FILED.

2. Plaintiff Carbaugh's Motion for Waiver of Page Limitations, Ct. Rec. 190, is GRANTED. Carbaugh's Memorandum in Opposition to Defendants' Motions for Partial Summary Judgment, Ct. Rec. 186, is ACCEPTED AS FILED.

3. Defendants WHC and FDH's Joint Motion for Expedited Hearing, Ct. Rec. 202, is GRANTED.

The Court considers Defendants' Joint Motion to Strike Jeffrey T. Sprung's Declaration in Opposition to Motion for Partial Summary Judgment, attached Exhibits, and Declaration of Jeffrey T. Sprung filed 8/9/99 and attached Exhibit A, Ct. Rec. 209, along with the rest of the Motions in this Order.

4. Defendant FDH's Motion to Dismiss Carbaugh's Third Amended Complaint Pursuant to Rule 12(b)(1), Ct. Rec. 173, is DENIED.

5. Defendant FDH's Motion for Partial Summary Judgment on Plaintiff David Carbaugh's Third Amended Complaint or, in the Alternative, to Dismiss Pursuant to Rule 12(b)(6), Ct. Rec. 165, is GRANTED IN PART and DENIED IN PART as delineated in Section XI. of this Order.

6. Defendant WHC's Motion for Summary Judgment against Carbaugh's Third Amended Complaint — Count 1, Ct. Rec. 137, is GRANTED IN PART and DENIED IN PART as delineated in Section X of his Order.

7. Defendant WHC's Motion to Dismiss Claims in Count 1 of Carbaugh's Third Amended Complaint predated March 19, 1990 as Prohibited by the Statute of Limitations, Ct. Rec. 143, is GRANTED.

8. Defendants WHC and FDH's Joint Motion to Strike Jeffrey T. Sprung's Declaration in Opposition to Motion for Partial Summary Judgment, attached Exhibits, and Declaration of Jeffrey T. Sprung filed 8/9/99 and attached Exhibit A, Ct. Rec. 209, is GRANTED IN PART and DENIED IN PART as delineated in Section IX of this Order.

9. Defendant WHC's Motion to Dismiss Trice's Second Amended Complaint for Lack of Subject Matter Jurisdiction and Standing, 146, is DENIED.

10. Defendant WHC's Motion for Summary Judgment against Trice's Second Amended Complaint — Count 1, Ct. Rec. 148, is GRANTED IN PART and DENIED IN PART as delineated in Section X of this Order.

11. Defendant WHC's Motion to Dismiss Trice's Second Amended Complaint for Improper Service, Ct. Rec. 151, is DENIED.

12. Defendant BCSR's Motion to Dismiss Plaintiff Trice's Second Amended Complaint for Insufficiency of Service of Process and Lack of Jurisdiction, Ct. Rec. 154, is DENIED.

13. Defendant BCSR's Motion to Dismiss Plaintiff Trice's Qui Tam Under the False Claims Act, Ct. Rec. 157, is GRANTED. Count 1 of Trice's Second Amended Complaint is DISMISSED WITHOUT PREJUDICE AS TO DEFENDANT BCSR.

14. Defendant BCSR's Motion to Dismiss Plaintiff Trice's Retaliation Claim Under 31 U.S.C. § 3730(h), Ct. Rec. 160, is GRANTED. Count 2 of Plaintiff Trice's Second Amended Complaint is DISMISSED WITHOUT PREJUDICE AS TO DEFENDANT BCSR.

The District Court Executive is directed to file this Order and provide copies to counsel AND TO pro se Plaintiff Trice.