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Fourth Circuit Interprets Corporate Knowledge And Materiality Under FCA

Client Alert | 1 min read | 01.08.04

In United States ex rel. Harrison v. Westinghouse Savannah River Co. (Dec. 19, 2003), the Fourth Circuit upheld a civil penalty of $195,000 ($7500 times 26 invoices) because the false cert "negatively affected the integrity of the bidding process," although zero actual damages were proven. The court held that (a) the False Claims Act's "knowledge" element was satisfied when one employee of the corporate defendant had knowledge of the facts making the corporation's certification false, even though there was no evidence that the same employee knew that the cert was required or even that it had been submitted; and (b) the false cert (that no organizational conflict of interest (OCI) existed in connection with a subcontract award) was "material" because it would have "had a natural tendency to influence" the government's decision to fund the subcontract "if it had known the full details" at the time of award, even though the government in fact concluded that no OCI existed when it subsequently learned of the issue and continued to pay for the subcontract work thereafter.

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Client Alert | 1 min read | 08.10.26

ASBCA Denies Government Motion to Dismiss, Providing Key Guidance on Contractor Claim Standards Post-ECC International

In Appeal of Bahadir (a C&M case), the Armed Services Board of Contract Appeals denied the government’s motion to dismiss in its entirety, ruling in favor of the contractor on both key issues raised by the government. The case arises from a contract for construction work at Al Udeid Air Base in Qatar, under which Appellant alleged government-caused delay and filed certified prolongation claims using a “windows analysis” methodology. The government moved to dismiss, arguing that Appellant failed to state a sum certain for each of what the government characterized as 38 distinct claims, and separately that four claims had not been properly presented to the Contracting Officer. ...

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