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U.S. EX REL. TOTTEN v. BOMBARDIER CORP.

March 27, 2001

UNITED STATES, EX REL EDWARD L. TOTTEN, PLAINTIFF,
v.
BOMBARDIER CORPORATION, AND ENVIROVAC INC., DEFENDANTS.



The opinion of the court was delivered by: Joyce Hens Green, United States District Judge.

ORDER

I. Background

In considering a motion to dismiss, the Court must accept the factual allegations contained in the complaint as true, and draw all reasonable inferences in favor of the plaintiff. The complaint may be dismissed only if the plaintiff can prove no set of facts consistent with his allegations which would entitle him to relief. See, e.g., Hishon v. King & Spalding, 467 U.S. 69, 73 (1984); Scheuer v. Rhodes, 416 U.S. 232, 236 (1974).
Totten was formerly employed by the National Railroad Passenger Corporation ("Amtrak"). Bombardier has contracted with Amtrak to manufacture passenger rail cars. Envirovac manufactures toilet systems, and contracts with both Amtrak and Bombardier to provide toilet systems for passenger rail cars. Amtrak has delineated requirements for its toilet waste systems, which are contained in Specification 598. These specifications are incorporated into Amtrak's contracts with Bombardier and Envirovac.
Totten states that Envirovac and Bombardier supplied Amtrak with toilet systems that did not meet the requirements of Specification 598, and eventually had to be repaired or upgraded. Totten further alleges that the defendants were aware of the defects in their products, and that they made false statements to Amtrak that the products met all requirements and specifications.
The False Claims Act creates liability for any person who knowingly presents to the government a false or fraudulent claim for payment. 31 U.S.C. § 3729 (a)(1). In 1986 Congress amended the Act by expanding the definition of "claim" to include requests "made to a contractor, grantee, or other recipient if the United States Government provides any portion of the money or property which is requested or demanded, or if the Government will reimburse such contractor, grantee, or other recipient for any portion of the money or property which is requested or demanded." 31 U.S.C. § 3729 (c). Private individuals may bring a qui tam civil action for a violation of section 3729, on behalf of themselves and the government. 31 U.S.C. § 2930 (b). The instant complaint alleges that the defendants knowingly made false claims against Amtrak, and that both Amtrak and the United States Government were damaged as a result. The complaint does not articulate any theory as to why a false claim against Amtrak would constitute a false claim against the government.

II. Analysis

The defendants correctly assert that Amtrak is not part of the government. Amtrak "is not a department, agency, or instrumentality of the United States Government." 49 U.S.C. § 24301 (a)(3); see also Lebron v. Nat'l Railroad Passenger Corp., 513 U.S. 374 (1995) (holding that Congress does not have the authority to determine Amtrak's status for Constitutional purposes, but noting that a statutory declaration of Amtrak's status would be dispositive as to matters within Congress' control). An assertion that the defendants presented false claims to Amtrak is therefore not, by itself, a sufficient allegation of a false claim under the Act.

A. 31 U.S.C. § 3729(c)

In his opposition, Totten responds that a false claim need not be presented directly to the government, and cites to the expanded definition of "claim" found in section 3729(c), which includes requests made to grantees or other recipients of federal funds. The Complaint does not include any allegations regarding Amtrak's status as a contractor or grantee, nor does it specifically allege that the government either provided Amtrak with, or reimbursed Amtrak for, any funds connected with the alleged false claims. As such, the complaint fails to state a claim. Ordinarily the Court might permit Totten to amend the complaint, because it is possible that a heavily government funded entity, such as Amtrak, might qualify as a grantee under Section 3729(c). See United States ex rel. Yesudian v. Howard University, 153 F.3d 731 (D.C. Cir. 1998).*fn1 However, the defendants have raised a threshold issue which obviates the need to determine whether Amtrak's government funding could bring it within the scope of section 3729(c).

B. 49 U.S.C. § 24301(a)(3)

The same provision in Amtrak's authorizing statute which establishes that Amtrak "is not a department, agency, or instrumentality of the United States Government" declares that Amtrak "shall not be subject to title 31." 49 U.S.C. § 24301 (a). The defendants argue that as a result, the False Claims Act, which is part of title 31, simply does not apply to Amtrak. As a result, the Act's definition of "claim" could not apply to requests made to Amtrak, and the Court would not be permitted to consider whether or not Amtrak's government funding makes it a "contractor, grantee, or other recipient." Totten counters that his complaint does not "subject" Amtrak to anything at all, including title 31.

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