Whistleblower convicted of fraud has case dismissed in EDWA

by Ben Vernia | June 19th, 2013

On May 13, Judge Lonny R. Suko of the Eastern District of Washington, in U.S. ex rel. Schroeder v. CH2M Hill granted the United States’ motion to dismiss the relator on the grounds that the False Claims Act, 31 USC 3730(d)(3) barred him from participating as a whistleblower because he had been convicted of criminal conduct arising from his role in the FCA violations (which involved a time card padding scheme at a government contractor).

Judge Suko first noted that the statute was unambiguous and required the relator’s dismissal, but he also concluded that the result was, in fact, an equitable one. The relator had only filed his suit after the government had first begun to investigate an anonymous tip about the scheme, and after he had admitted his participation to investigative agents. He reiterated these admissions when he was interviewed again after filing his case (and after being read his Miranda rights), and he should have known the implications of his admissions on his qui tam case. In addition, the court reasoned, the plea agreement he had reached with the government was very favorable to the whistleblower.

The relatot has filed a notice of appeal to the Ninth Circuit.

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