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Hicks v. District of Columbia

United States District Court, District of Columbia

April 28, 2016

PAUL HICKS, Plaintiff
v.
DISTRICT OF COLUMBIA, Defendant

MEMORANDUM OPINION and ORDER

COLLEEN KOLLAR-KOTELLY United States District Judge

Plaintiff Paul Hicks, a former employee of the District of Columbia’s Office of the Inspector General (“OIG”), brings several claims against Defendant District of Columbia in connection with the alleged termination of his employment with OIG. The Amended Complaint presents a claim of racial discrimination under Title VII of the Civil Rights Act of 1964, as amended; a claim of age discrimination under the Age Discrimination in Employment Act of 1967, as amended; a claim of retaliation under the Federal False Claims Act (“FCA”); a claim of retaliation under the District of Columbia False Claims Act (“D.C. FCA”); and a claim of retaliation under D.C. Code § 1-615.51 et seq. Before the Court is Defendant’s [13] Motion to Dismiss Counts 3 & 4 of Amended Complaint. Defendant seeks the dismissal of the retaliation claims under the Federal and D.C. false claims acts for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). Upon consideration of the pleadings, [1] the relevant legal authorities, and the record for purposes of this motion, the Court DENIES Defendant’s [13] Motion to Dismiss Counts 3 & 4 of Amended Complaint.

I. BACKGROUND

For the purposes of the motion before the Court, the Court accepts as true the well-pleaded allegations in Plaintiff’s Amended Complaint. The Court does “not accept as true, however, the plaintiff’s legal conclusions or inferences that are unsupported by the facts alleged.” Ralls Corp. v. Comm. on Foreign Inv. in U.S., 758 F.3d 296, 315 (D.C. Cir. 2014). The Court limits its presentation of the background to those facts relevant to the pending motion to dismiss.

A. Statutory Framework: Federal False Claims Act

“Ordinarily under the [False Claims Act], ‘the government, or a party suing on its behalf, may recover for false claims made by the defendant to secure a payment by the government.’ ”[2]Hoyte v. Am. Nat. Red Cross, 518 F.3d 61, 63 n.1 (D.C. Cir. 2008) (quoting United States ex rel. Bain v. Ga. Gulf Corp., 386 F.3d 648, 652 (5th Cir. 2004)). However, “[i]n a reverse false claim action under … [Section 3729(a)(1)(G)], ‘the defendant’s action does not result in improper payment by the government to the defendant, but instead results in no payment to the government when a payment is obligated.’ ”[3] Id. (quoting Ga. Gulf Corp., 386 F.3d at 653). Specifically, the Federal False Claims Act establishes liability for any person who “knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government.” 31 U.S.C. § 3729(a)(1)(G). The Federal False Claims Act, as amended in 2009, defines “obligation” as “an established duty, whether or not fixed, arising from an express or implied contractual, grantor-grantee, or licensor-licensee relationship, from a fee-based or similar relationship, from statute or regulation, or from the retention of any overpayment.” Id. § 3729(b)(3). Subject to exceptions not relevant here, a person liable under these provisions is liable to the United States Government for a civil penalty “plus 3 times the amount of damages which the Government sustains because of the act of that person.” Id. § 3129(a)(1).

Finally, the Federal False Claims Act allows retaliation claims in connection with other provisions of the Act:

Any employee, contractor, or agent shall be entitled to all relief necessary to make that employee, contractor, or agent whole, if that employee, contractor, or agent is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts done by the employee, contractor, agent or associated others in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter.

31 U.S.C. § 3730(h)(1) (emphasis added). In other words, the False Claims Act creates a retaliation claim in circumstances where, in addition to satisfying other criteria, a person suffers retaliation as a result of “lawful acts … in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter.” Id.

The retaliation provision, which was “first added in 1986, was ‘designed to protect persons who assist the discovery and prosecution of fraud and thus to improve the federal government’s prospects of deterring and redressing crime.’ ” U.S. ex rel. Schweizer v. Oce N.V., 677 F.3d 1228, 1237 (D.C. Cir. 2012) (citation omitted). Most significantly, the provision was amended in 2009 to add the final phrase in the provision, clarifying that a retaliation claim can be based on “other efforts to stop 1 or more violations of” the False Claims Act. 31 U.S.C. § 3730(h)(1); see Pencheng Si, 71 F.Supp. 3d at 90 (describing version of retaliation provision prior to the 2009 amendments); Fraud Enforcement and Recovery Act of 2009, Pub. L. No. 111- 21, § 4(a) & (d), 123 Stat. 1617, 1621-25 (amending retaliation provision).[4] These amendments significantly expanded the protection to whistleblowers under the Federal False Claims Act. See U.S. ex rel. New Mexico v. Deming Hosp. Corp., 992 F.Supp.2d 1137, 1163 (D.N.M. 2013) (amended version of the retaliation provision “represents a significant expansion of protection for [False Claims Act] whistleblowers”) (footnote omitted).

Notwithstanding these changes, the essential elements of a retaliation claim under the False Claims Act remain the same. See Id. A retaliation claim has “two basic elements”: (1) protected activity by an employee and (2) “retaliation by the employer against the employee ‘because of’ those acts.” Schweizer, 677 F.3d at 1237 (quoting United States ex rel. Yesudian v. Howard Univ., 153 F.3d 731, 736 (D.C. Cir. 1998)). As stated above, in light of the 2009 amendments to the False Claims Act, protected activity includes both “lawful acts done by the employee … in furtherance of an action” under the False Claims Act and “other efforts to stop 1 or more violations of” the False Claims Act. 31 U.S.C. § 3730(h).

B. Statutory Framework: D.C. False Claims Act

The parties agree that the relevant provisions of the D.C. False Claims Act are the same in all material respects as the provisions of the Federal False Claims Act. See Def.’s Mot. at 4-5; Pl.’s Opp’n at 3 n.1 (“Retaliation claims under the Federal False Claims Act and the D.C. False Claims Act have the same elements. Moreover, the anti-retaliation provisions of both Acts are nearly identical. Therefore, the arguments proffered in the instant Opposition similarly apply to Plaintiff’s retaliation claim under the D.C. False Claims Act.”) (citations omitted). “The elements of a [D.C. False Claims Act] retaliation claim mirror, and are analyzed in a similar fashion to, a retaliation claim arising under the federal False Claims Act … .” Campbell v. D.C., 972 F.Supp.2d 38, 47 (D.D.C. 2013).[5] In addition, the District of Columbia Court of Appeals has stated that it is appropriate to look to Federal cases interpreting the Federal False Claims Act “for guidance in interpreting the [D.C.] FCA.” Grayson v. AT & T Corp., 980 A.2d 1137, 1146 n.25 (D.C. 2009), reh’g en banc granted, opinion vacated in part on other grounds, 989 A.2d 709 (D.C. 2010), and on reh’g en banc, reissuing panel decision in part 15 A.3d ...


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