D.C. magistrate judge rules that False Claims Act liability survives a defendant's death

by admin | May 1st, 2014

In a long-running case in the District Court for the District of Columbia, Magistrate Judge John Facciola ruled on April 1 that a judgment against a False Claims Act defendant survived his death four years ago, and stayed the case pending a motion for substitution under Rule 25.

The government brought the case in 1989 against a Washington-area developer, T. Conrad Monts, and his company, TDC Management. In 2001, the District Court granted the government’s motion for summary judgment, awarding it nearly $1.3 million. In a separate case brought in D.C. Superior Court, a judge awarded another company, Washington Development Group (WDG) – which the government alleged Monts controlled – an $8.4 million judgment against the District of Columbia. Upon learning of this latter judgment, the government moved to garnish, asserting that Monts controlled both companies, and that WDG was the alter ego of Monts for the purpose of determining the ownership of its judgment against the District. Monts died in 2009.

Magistrate Judge Facciola, after reviewing the Supreme Court’s decision in Cook County, Illinois v. United States ex rel. Chandler (2003), and subsequent decisions concerning the survivability of a relator’s interest in a qui tam case, concluded that “their reasoning applies equally to the death of a defendant: federal common law applies, and the FCA serves a primarily remedial purpose.”

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