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Fca Violators' Goal Is To Get Govt. To Open Its Wallet, Rules Supreme Court

Tuesday, November 04, 2008 04:03 pm

Fca Violators' Goal Is To Get Govt. To Open Its Wallet, Rules Supreme Court

The U.S. Supreme Court recently took a magnifying glass to what the False Claims Act (FCA) has to say about those who seek payment on government projects based on false claims. The bottom line: The element of an alleged fraudsters' intent is key because without it the FCA would expand beyond its bounds.

The case at hand involved two shipbuilders hired by the U.S. Navy to construct a fleet of destroyers, each of which required three generator sets to supply electrical power. Construction of the sets involved three contractors: Allison Engine Company, Inc. (Allison Engine), General Tool Company (GTC) and Southern Ohio Fabricators, Inc. (SOFCO). Two former GTC employees (the respondents) sued Allison Engine, GTC and SOFCO (the petitioners) in an Ohio district court under the FCA 31 U.S.C.S. 3729.

The FCA holds liable anyone who knowingly makes or uses a "false ... statement to get a false or fraudulent claim paid or approved by the Govern-ment" ( 3729(a)(2)) and "conspires to defraud the Government by getting fal [...]

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