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United States v. Greer

United States District Court, District of Columbia

January 22, 2019

UNITED STATES OF AMERICA, Plaintiff,
v.
DOUGLAS F. GREER, M.D., et al., Defendants.

          MEMORANDUM OPINION

          ROSEMARY M. COLLYER, UNITED STATES DISTRICT JUDGE.

         They say that diamonds are forever. Are contracts? The government asks the Court to enforce a False Claims Act settlement that it appears to have ignored for years. Douglas F. Greer, M.D., the counterparty, argues that the six-year statute of limitations has long since passed. Both parties move for summary judgment. Although the government is not entitled to recover on all of its claims, the Court finds that this lawsuit is timely, filed as it was within six years of Dr. Greer's completion of his related criminal sentence, and will grant in part and deny in part both motions for summary judgment.

         I. FACTS

         On May 3, 2007, Dr. Douglas F. Greer, an ophthalmologist, pled guilty for himself and his medical practice, Douglas F. Greer, M.D., P.C., to one count of Health Care Fraud, in violation of 18 U.S.C. § 1347, and one count of Filing a False Tax Return, in violation of 26 U.S.C. § 7206(1), for submitting fraudulent claims for payment as a medical doctor to Medicare and Federal Health Benefit programs for services not rendered or not medically necessary and for falsifying his business tax records. Minute Entry, United States v. Greer, No. CR-07-095-01 (RJL) (D.D.C. May 3, 2007). As part of his sentence, Dr. Greer was ordered to pay a $25, 000 fine on each count ($50, 000 in total), unpaid taxes, and restitution totaling approximately $1.2 million. Judgment at 5, United States v. Greer, No. CR-07-095-01 (RJL) (D.D.C. July 26, 2007). He was also sentenced to 18 months imprisonment and 24 months of supervised release. Id. at 2-3. As special conditions of his supervised release, Dr. Greer was required to serve 180 days (6 months) in home detention with electronic monitoring and to perform 500 hours of community service within the 24-month period. Id. at 4. Thus, he was ordered to serve a sentence of three-and-one-half years in various degrees of confinement.

         On July 24, 2007, before his criminal sentencing, Dr. Greer and his medical practice settled a parallel, $1 million civil suit brought by the government under the False Claims Act (FCA), 31 U.S.C. § 3729, in return for the liquidation of identified assets. See generally Ex. A, Def.'s Mot. for Summ. J., Settlement Agreement (Agreement) [Dkt. 23-1]. Specifically, because he did not have the funds to pay both the criminal penalties and the civil judgment, as part of the Agreement, Dr. Greer agreed, inter alia, to liquidate his retirement accounts, assessed at $1, 011, 747; liquidate other assets, assessed at approximately $500, 000, $189, 000 of which represented the limit of his Practice Guard Insurance policy; and sell his second house at 1811 47th Place, NW, Washington, D.C., assessed at $536, 500. Id. at 2. Funds collected from these liquidations, net taxes, were allocated first to pay the criminal penalties and then to pay the civil debt, except that the monies from the insurance policy ($189, 000) could only be contributed towards the civil debt. Id. ¶ 2.

         On September 11, 2007, Dr. Greer paid the government $189, 000 under the Agreement.[1] Ex. 5, United States' Mot. for Summ. J., Confirmation Notice of Receipt of FEDWIRE Electronic Funds Transfer (EFT) by the NCIF [Dkt. 24-8]. Then, as ordered by the sentencing judge, Dr. Greer reported to prison on November 15, 2007. See Order, United States v. Greer, No. CR-07-095-01 (D.D.C. Oct. 19, 2007). At that time, he had not sold the house at 47th Place. The government did not insist. On March 5, 2009, Dr. Greer was released from prison to serve the duration of his sentence on supervised release, i.e., until 2011. Federal Bureau of Prisons Inmate Locator, https://www.bop.gov/inmateloc/ (last visited Jan. 8, 2019) (search for BOP Register Number “29030-016”).[2] He still did not sell the house. The government still did not insist. This situation continued until December 21, 2015, when the government sent Dr. Greer a letter informing him that he had breached the Agreement. Ex. 6, United States' Mot. for Summ. J., Letter from Oliver McDaniel, Assistant U.S. Attorney, to Alan Reider, Arnold & Porter (Dec. 21, 2015) [Dkt. 24-9] (“Your client is in breach of this agreement, having made no recent demonstrated effort to make a payment or to discuss a payment arrangement.”). Dr. Greer refused to pay and the government filed the immediate Complaint on April 27, 2016, seeking to enforce the Agreement by compelling liquidation of Dr. Greer's existing retirement account and sale of the house at 47th Place. Compl. at 5 [Dkt. 1]. Both parties now move for summary judgement.[3]

         II. LEGAL STANDARD

         Summary judgment may be granted if “the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). All reasonable inferences that may be drawn from the facts placed before the court must be drawn in favor of the non-moving party. Williams v. Callaghan, 938 F.Supp. 46, 49 (D.D.C. 1996) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986)). However, the non-moving party must still make a factual showing to create a genuine issue of material fact, and assertions of fact must be properly supported. See Id. (citing Harding v. Gray, 9 F.3d 150, 154 (D.C. Cir. 1993)).

         Federal district courts have the authority to enforce settlement agreements entered into by the litigants before them.[4] See Samra v. Shaheen Bus & Inv. Group, Inc., 355 F.Supp. 2d. 483, 493 (D.D.C. 2005). “An agreement to settle a legal dispute is a contract[, ] . . . [and] [t]he enforceability of settlement agreements is governed by familiar principles of contract law.” Village of Kaktovik v. Watt, 689 F.2d 222, 230 (D.C. Cir. 1982). “An action to enforce a settlement agreement is, at bottom, an action seeking the equitable remedy of specific performance of a contract.” Samra, 355 F.Supp.2d at 493. Therefore, a district court may summarily enforce a completed settlement agreement-i.e., one as to which there is no dispute as to “the material facts concerning the existence or terms of an agreement to settle.” Wilson v. Wilson, 46 F.3d 660, 666 (7th Cir. 1995); see also Autera v. Robinson, 419 F.2d 1197, 1202-03 (D.C. Cir. 1969).

         III. ANALYSIS

         “[O]bligations to and rights of the United States under its contracts are governed exclusively by federal law.” Boyle v. United Tech. Corp., 487 U.S. 500, 504 (1988). “Courts must therefore apply the federal common law of contracts to the interpretation of contracts with the federal government.” Red Lake Band of Chippewa Indians v. Dep't of Interior, 624 F.Supp.2d 1, 12 (D.D.C. 2009) (citing Wright v. Foreign Serv. Grievance Bd., 503 F.Supp.2d 163, 180 (D.D.C. 2007)); see also United States v. Kearns, 595 F.2d 729, 732 (D.C. Cir. 1978) (noting that “it is by now accepted that federal common law provides remedies in many situations, ” including “[g]overnment contracts”). To state such a claim, a party must show: “(1) a valid contract between the parties; (2) an obligation or duty arising out of the contract; (3) a breach of that duty; and (4) damages caused by the breach.” Red Lake Band of Chippewa Indians, 624 F.Supp.2d at 12 (citation omitted). “A breach of contract is simply the non-performance of a contractual duty.” Kasarsky v. Merit Sys. Prot. Bd., 296 F.3d 1331, 1336 (Fed. Cir. 2002) (citing Restatement (Second) of Contracts § 235(2) (1981)). When a contract does not specify a period for performance, “the law imposes an obligation to act within a reasonable period of time.” Essex Electro Eng'rs, Inc. v. Danzig, 224 F.3d 1283, 1291 (Fed. Cir. 2000) (quoting Specialty Assembling & Packing Co. v. United States, 355 F.2d 554, 565 (Ct. Cl. 1966)). “That period is determined ‘by the reasonable expectations of the parties in the special circumstances in which they contracted.'” Id. (quoting Commerce Int'l Co. v. United States, 338 F.2d 81, 87 (Ct. Cl. 1964)). The statute of limitations for the United States to sue for a breach of contract normally runs after six years. 28 U.S.C. § 2415(a).

         A. Amount Owed Under the Agreement and Performance To-Date

         Some preliminary matters need discussion. First, the Complaint alleges that Dr. Greer agreed to pay $1 million to settle the FCA lawsuit, see Compl. ¶ 9, and that, having already paid $189, 000 towards that amount, he has an outstanding balance of $811, 000, plus interest, to be paid by liquidation of his current retirement account and sale of the house at 47th Place. See id. at 5. This claim overstates the obligation. In the Agreement, the government “asserted a demand against Dr. Greer” for payment of $1, 000, 000, ” based upon his admitted crimes and false claims, see Agreement at 1; Dr. Greer represented that he could not pay such a judgment, see Id. at 2; the parties, “to avoid the delay, inconvenience and expense of protracted litigation, ” agreed that Dr. Greer would liquidate certain assets in satisfaction of the FCA liabilities, see Id. ¶ 2; and the parties recognized that any amount raised by liquidating the specific assets-except the $189, 000 from the insurance policy-would first go towards the criminal penalties, see id. The Agreement does not contain terms for future payment, such as by wage garnishment or the like. Further, while the Agreement made clear that, no matter the total value of his assets, Dr. Greer was obligated “to make full restitution under the terms of the [criminal] Plea Agreement, ” id., no such statement was included regarding the $1 million demand asserted. Thus, performance of the civil Agreement was to be satisfied by liquidation of specified assets (and documentation of the same) but not the payment of a specified amount, and in this context the government's FCA demand of $1 million serves as a cap to the funds the government can receive from Dr. Greer.

         Second, it appears that Dr. Greer has already partially performed under the Agreement by liquidating some of the specified assets: $189, 000 was paid to the government, which it clearly believes came from the insurance policy. See Greer Dep. 50:19-20, 65:22-66:6. Dr. Greer also liquidated his retirement accounts in 2007 and paid the proceeds to the government, see id. at 24:5-18, 51:14-19, and the government does not allege that he failed to liquidate the “other assets” worth $500, 000. Compl. ¶ 9. The government argues that, notwithstanding the liquidation of assets, no other payments were made under the Agreement, and seeks to force Dr. Greer to liquidate current retirement accounts that were not otherwise discussed in the Agreement; the Court notes that the Agreement required Dr. Greer to use the settlement funds to pay the criminal penalties first, about which the government makes no complaint. Because the Agreement does not require Dr. Greer to use assets ...


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