UNITED STATES OF AMERICA et al v. INDIANAPOLIS FIRE DEPARTMENT
ORDER - Plaintiff Rodney Heath ("Rodney") is a backup fire investigator with the Defendant Indianapolis Fire Department ("IFD"). Rodney has filed a qui tam action pursuant to the False Claims Act ("FCA"), alleging that IFD submitted to the Federal Emergency Management Agency ("FEMA") false statements in connection with a grant application and related payment requests. Rodney's son Quinn Heath ("Quinn") alleges that after Rodney filed th is action, IFD retaliated against Quinn by failing to hire him as a firefighter with the Department. Presently pending before the Court is IFD's Motion for Summary Judgment. [Filing No. 78 .] For the reasons that follow, the Court denies IF D's Motion as to Rodney's claims and grants IFD's Motion as to Quinn's claim. The Court DENIES IFD's Motion for Summary Judgment as to Rodney Heath's claims under 31 U.S.C. § 3720(a)(1)(B) and 31 U.S.C. § 372 0(a)(1)(A) and GRANTS IFD's Motion for Summary Judgment as to Quinn Heath's claim under 31 U.S.C. §3730(h). [Filing No. 78 .] No partial judgment shall issue at this time, and the Court requests that the Magistrate Judge confer with the parties regarding possible resolution of the remaining claims. (See Order.) Signed by Judge Jane Magnus-Stinson on 4/24/2017.(APD)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
UNITED STATES OF AMERICA ex rel.
RODNEY C. HEATH and QUINN R.
INDIANAPOLIS FIRE DEPARTMENT,
Plaintiff Rodney Heath (“Rodney”) is a backup fire investigator with the Defendant
Indianapolis Fire Department (“IFD”). Rodney has filed a qui tam action pursuant to the False
Claims Act (“FCA”), alleging that IFD submitted to the Federal Emergency Management Agency
(“FEMA”) false statements in connection with a grant application and related payment requests.
Rodney’s son Quinn Heath (“Quinn”) alleges that after Rodney filed this action, IFD retaliated
against Quinn by failing to hire him as a firefighter with the Department. Presently pending before
the Court is IFD’s Motion for Summary Judgment. [Filing No. 78.] For the reasons that follow,
the Court denies IFD’s Motion as to Rodney’s claims and grants IFD’s Motion as to Quinn’s claim.
A motion for summary judgment asks the Court to find that a trial is unnecessary because
there is no genuine dispute as to any material fact and, instead, the movant is entitled to judgment
as a matter of law. See Fed. R. Civ. P. 56(a). As the current version of Rule 56 makes clear,
whether a party asserts that a fact is undisputed or genuinely disputed, the party must support the
asserted fact by citing to particular parts of the record, including depositions, documents, or
affidavits. Fed. R. Civ. P. 56(c)(1)(A). A party can also support a fact by showing that the
materials cited do not establish the absence or presence of a genuine dispute or that the adverse
party cannot produce admissible evidence to support the fact. Fed. R. Civ. P. 56(c)(1)(B).
Affidavits or declarations must be made on personal knowledge, set out facts that would be
admissible in evidence, and show that the affiant is competent to testify on matters stated. Fed. R.
Civ. P. 56(c)(4). Failure to properly support a fact in opposition to a movant’s factual assertion
can result in the movant’s fact being considered undisputed, and potentially in the grant of
summary judgment. Fed. R. Civ. P. 56(e).
In deciding a motion for summary judgment, the Court need only consider disputed facts
that are material to the decision. A disputed fact is material if it might affect the outcome of the
suit under the governing law. Hampton v. Ford Motor Co., 561 F.3d 709, 713 (7th Cir. 2009). In
other words, while there may be facts that are in dispute, summary judgment is appropriate if those
facts are not outcome determinative. Harper v. Vigilant Ins. Co., 433 F.3d 521, 525 (7th Cir.
2005). Fact disputes that are irrelevant to the legal question will not be considered. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
On summary judgment, a party must show the Court what evidence it has that would
convince a trier of fact to accept its version of the events. Johnson v. Cambridge Indus., 325 F.3d
892, 901 (7th Cir. 2003). The moving party is entitled to summary judgment if no reasonable factfinder could return a verdict for the non-moving party. Nelson v. Miller, 570 F.3d 868, 875 (7th
Cir. 2009). The Court views the record in the light most favorable to the non-moving party and
draws all reasonable inferences in that party’s favor. Darst v. Interstate Brands Corp., 512 F.3d
903, 907 (7th Cir. 2008). It cannot weigh evidence or make credibility determinations on summary
judgment because those tasks are left to the fact-finder. O’Leary v. Accretive Health, Inc., 657
F.3d 625, 630 (7th Cir. 2011). The Court need only consider the cited materials, Fed. R. Civ. P.
56(c)(3), and the Seventh Circuit Court of Appeals has “repeatedly assured the district courts that
they are not required to scour every inch of the record for evidence that is potentially relevant to
the summary judgment motion before them,” Johnson, 325 F.3d at 898. Any doubt as to the
existence of a genuine issue for trial is resolved against the moving party. Ponsetti v. GE Pension
Plan, 614 F.3d 684, 691 (7th Cir. 2010).
On January 18, 2013, IFD submitted a grant application to FEMA for a Fire Prevention
and Safety Grant (the “FP&S Grant”). [Filing No. 78-2.] The application requested funding to
expand the territory of IFD’s fire investigation unit (the “arson unit”) to the south side of
Indianapolis. [Filing No. 78-2 at 3-4.] The application specifically requested funding for four fire
investigators and one IT Specialist, with each position to be paid a lieutenant-grade salary of
$70,838 and a fringe benefits package of $28,523. [Filing No. 78-2 at 10-11.] The IT Specialist’s
job duties were designated in the grant application as assisting with “data collection, management,
and analysis.” [Filing No. 78-2 at 9.]
On April 5, 2013, FEMA staff recommended awarding the grant to IFD. [Filing No. 78-3
at 1.] On May 16, 2013, before the grant was awarded, FEMA grant specialist Francisco Bernal
requested that IFD provide the names and salaries of the four investigators and the IT Specialist,
as well as the percentages of time that they would each spend on grant-funded activities. [Filing
No. 78-4 at 1.] Mr. Bernal requested this information pursuant to the “financial integrity review”
that FEMA conducts of each grant application. [Filing No. 78-3 at 2.] IFD Deputy Chief Al
Stovall responded by email to that request on May 31, 2013, stating that, as relevant here, Benjamin
Tupper would serve as the IT Specialist, that Mr. Tupper would spend 80% of his time on activities
related to the grant, and that his annual salary was $73,113. [Filing No. 78-4 at 3-4.] On June 4,
2013, Mr. Bernal replied by email, asking for clarification that “…the amount that should be
requested in the grant application [for Mr. Tupper’s salary] is $58,490. Is that correct?” [Filing
No. 84-10 at 1.] Deputy Chief Stovall responded that Mr. Bernal’s clarification was correct.
[Filing No. 84-10 at 1.] FEMA awarded the FP&S grant on July 19, 2013, with a period of
performance to run from July 11, 2013 to July 10, 2014. [Filing No. 78-3 at 1; Filing No. 78-5 at
Prior to receiving the grant, beginning sometime in 2011, Mr. Tupper worked in a “special
projects” position and reported to Deputy Chief Stovall. [Filing No. 78-7 at 7; Filing No. 78-8 at
25.] After the grant was awarded, IFD “reclassified [Mr. Tupper’s] position to accommodate the
award of the grant in title and responsibility.” [Filing No. 78-8 at 25.] Deputy Chief Stovall
instructed Mr. Tupper to spend 80% of his time on grant-related activities. [Filing No. 84-14 at
10.] Mr. Tupper’s duties included “gather[ing] the requirements necessary for [IFD] to deliver an
application or a series of reports that will allow the arson unit to more efficiently advance their
clearance rates, increase their effectiveness overall….” [Filing No. 78-8 at 28.] Mr. Tupper’s
duties did not include providing technological support for fire investigators in the south side fire
investigation unit, where he had been employed prior to his special projects role. [Filing No. 8414 at 9.] His office remained in the City-County Building, and he did not relocate to the building
where the south side fire investigation unit was located. [Filing No. 78-8 at 17; Filing No. 78-8 at
Mr. Tupper left the IT Specialist position in February 2014 to return to the fire suppression
unit. [Filing No. 84-15 at 24-25.] During the approximately six months that Mr. Tupper worked
as an IT Specialist, he attended several meetings with members of the fire investigation unit.
[Filing No. 78-8 at 27.] Mr. Tupper also had a standing weekly meeting with Deputy Chief Stovall
to update him on their projects. [Filing No. 78-8 at 30.] He also met with members of the
Indianapolis Metropolitan Police Department’s bomb unit to identify any tools already in use that
could “fulfill the requirements of the grant.” [Filing No. 78-7 at 15-16.] Mr. Tupper was tasked
with creating a “Gantt Chart” of project components by the end of the grant year. [Filing No. 8415 at 22-23.] He was also tasked with “defining the deliverables” of the grant. [Filing No. 84-15
at 25-26.] Mr. Tupper did not complete either of those projects before his departure six months
into the grant. [Filing No. 84-15 at 23-26.]
Deputy Chief Stovall did not fill the vacant IT Specialist position after Mr. Tupper
departed, [Filing No. 78-8 at 43-44], and IFD did not notify FEMA that the IT Specialist position
had been vacated, [Filing No. 78-3 at 3]. IFD eventually sought and received an amendment to
the grant, extending its period of performance through December 31, 2014. [Filing No. 78-10 at
1.] On May 30, 2014, IFD submitted a reimbursement request to FEMA, which included
$34,816.37 for the IT Specialist’s costs. [Filing No. 78-9 at 1-4.] On December 8, 2015, IFD
submitted a final grant closeout report to FEMA that indicated a charge of $34,816.37 to the FP&S
grant award for the IT Specialist’s costs. [Filing No. 78-9 at 20.] Of that amount, FEMA
reimbursed $18,593.03 and IFD paid $16,223.34 in cost-matching. [Filing No. 78-9 at 3-4.]
Plaintiff Rodney Heath (or the relator, in FCA terminology) is a backup investigator in the
arson unit. [Filing No. 78-12 at 8.] In January 2015, Quinn Heath, Rodney’s son, passed IFD’s
written examination to become a firefighter. [Filing No. 58 at 5.] On March 8, 2015 he passed an
oral interview with IFD. [Filing No. 58 at 6.] In April 2015, he passed the Certified Physical
Agility Test. [Filing No. 58 at 6.] On March 13, 2015, while Quinn was completing the application
process with IFD, Rodney filed the qui tam action in this Court. [Filing No. 1.]
After completing his required testing, Quinn was ranked 82nd among all applicants in his
application cycle. [Filing No. 78-13 at 50.] IFD utilizes an 80/20 policy, under which the Fire
Chief is required to fill the first 80% of an entering class’s slots with candidates chosen in rank
order, and he may choose the remaining 20% from anyone remaining on the eligibility list. [Filing
No. 84-19 at 8-9.] 30 applicants were selected for the academy class scheduled to begin on August
3, 2015. [Filing No. 84-19 at 14-15.] Fire Chief Ernest Malone selected the top-ranked 24
applicants to meet the 80% rule, and he selected the remaining 20% based on his discretion. [Filing
No. 84-19 at 10.] In May 2015, Quinn learned that he was not selected for this class. [Filing No.
84-20 at 2-3.]
On September 16, 2015, Quinn was informed that he had not been selected for the second
recruit class scheduled to begin February 2016. [Filing No. 84-12 at 1-2.] For that class, Chief
Malone selected 39 applicants. [Filing No. 84-19 at 15.] He selected 27 applicants based on rank
and 12 applicants based on discretion. [Filing No. 84-19 at 13.]
Also on September 16, 2015, Deputy Chief Fred Pervine informed Lieutenant Mario Garza
and others that they were scheduled to be interviewed by federal investigators regarding the FP&S
Grant. [Filing No. 84-13.] When Lieutenant Garza asked Deputy Chief Pervine why these
individuals were being interviewed, Deputy Chief Pervine responded that Rodney had made a
complaint to the federal government. [Filing No. 84-17 at 7-9.]
The Plaintiffs raise three claims under the False Claims Act, the first two brought by
Rodney, and the third brought by Quinn: (1) violation of 31 U.S.C. § 3720(a)(1)(B), alleging that
IFD falsely represented to FEMA that Mr. Tupper would be the IT Specialist and would dedicate
80% of his work time to the FP&S Grant; (2) violation of 31 U.S.C. § 3729(a)(1)(A), alleging that
IFD submitted false reimbursement requests when it requested reimbursement for Mr. Tupper’s
salary; and (3) violation of 31 U.S.C. § 3730(h), alleging that IFD unlawfully retaliated against
Quinn because of Rodney’s qui tam action.
The FCA “permits private citizens, called relators, to prosecute qui tam suits against
alleged fraudsters on behalf of the United States government.” Thulin v. Shopko Stores Operating
Co., LLC, 771 F.3d 994, 998 (7th Cir. 2014). The United States may opt to intervene in a qui tam
suit, 31 U.S.C. § 3730(b)(2), but where it declines to do so—as it has here, [Filing No. 31]—the
relator may continue pursuing the lawsuit. United States ex rel. Watson v. King-Vassel, 728 F.3d
707, 711 (7th Cir. 2013); 31 U.S.C. § 3730(c)(3).
A. Violations of 31 U.S.C. § 3729(a)(1)(A), (B)
To state a claim under the FCA, a plaintiff must show that: (1) the defendant made a
statement in order to receive money from the government; (2) the statement was false; (3) the
defendant knew that the statement was false; and (4) the false statement was material to the
government’s decision to pay or approve the false claim. U.S. ex rel. Marshall v. Woodward, Inc.,
812 F.3d 556, 561 (7th Cir. 2015), cert. denied, 136 S. Ct. 2510, 195 L. Ed. 2d 840 (2016); see
also 31 U.S.C. § 3729(a)(1)(A) (imposing liability for one who “knowingly presents, or causes to
be presented, a false or fraudulent claim for payment or approval”) and 31 U.S.C. § 3729(a)(1)(B)
(imposing liability for one who “knowingly makes, uses, or causes to be made or used, a false
record or statement material to a false or fraudulent claim”).
The crux of Rodney’s claims is that IFD made a false statement to FEMA when it claimed
that Mr. Tupper would devote 80% of his time to grant-related projects, and it made another false
statement when it submitted payment requests for Mr. Tupper’s salary. The parties do not dispute
that IFD made a statement in order to receive money from the government. IFD argues, however,
that Rodney cannot establish that the statements at issue were false, that IFD knew the statements
were false, or that the allegedly false statements were material to the government’s decision to
approve the grant or make a payment pursuant to it. The Court addresses each element in turn.
1. Falsity of Statements
IFD argues that neither of the statements at issue were false. [Filing No. 79 at 13-14; Filing
No. 79 at 18-21.] Rodney contends that Deputy Chief Stovall’s representation to Mr. Bernal that
Mr. Tupper would be the IT Specialist, and that he would dedicate 80% of his time to grant-related
projects was false because (1) Mr. Tupper did not perform the duties of an IT Specialist; (2) he did
not spend 80% of his time working on grant-related activities throughout the life of the grant,
because he left his position prematurely in February 2014; and (3) a genuine dispute of material
fact exists as to whether Mr. Tupper spent 80% of his time on the FP&S Grant, even if the relevant
time period is limited to when he was assigned to the IT Specialist role. [Filing No. 95 at 15-19.]
And because Mr. Tupper did not dedicate the requisite time to his IT Specialist duties, Rodney
argues, the payment request for his salary was false as well. [Filing No. 95 at 23-25.]
IFD responds that Mr. Tupper performed the duties as described in the grant application,
and that Rodney’s attempt to impose his own definition of “IT Specialist” should be rejected.
[Filing No. 86 at 2-4.] IFD also argues that Deputy Chief Stovall directed Mr. Tupper to spend
80% of his time on grant-related activities, so his statement was not false when made. [Filing No.
79 at 15.] And finally, IFD contends that its payment request was not false, because it did not
claim reimbursement for Mr. Tupper’s salary after he left the IT Specialist position. [Filing No.
79 at 18-21.]
a. The 80% Statement
Rodney raises several arguments in support of the contention that the grant application
contained a false statement.
First, Rodney argues that Mr. Tupper was designated as the IT Specialist, but “he did not
regularly perform the duties that one would expect an IT Specialist to perform, such as technology
support or other computer help for the fire investigators on the south side unit.” [Filing No. 95 at
15.] Rodney argues that the “title of IT Specialist generally connotes a specific type of skill set,
such as IT or computer science training, education, or certifications, and specific types of duties,
such as tech support and maintenance of IT systems.” [Filing No. 95 at 16.] This argument is
unpersuasive, however, for several reasons. First, the grant application specifically defines what
duties the IT Specialist was designated to perform: “assist[ing] with data collection, management,
and analysis.” [Filing No. 78-2 at 9.] If these duties were not within the scope that the grant
encompassed, FEMA could have so stated. It did not, so the Court can only conclude that the
parties reached a mutual understanding as to what duties the IT Specialist would properly perform.
Second, Rodney provides no explanation as to why this Court should conclude that his proposed
definition of “IT Specialist” should trump the contractual language drafted by IFD and accepted
by FEMA. Given that agreement, Rodney’s argument reduces to merely a dispute regarding what
title Mr. Tupper should have been given. That dispute does not demonstrate falsity.
Rodney also objects to this job description as being “so vague and generic that it could
possibly apply to a wide range of personnel in the IFD.” [Filing No. 95 at 16.] But the position
description’s vagueness is irrelevant, given that FEMA approved funding for the position as
Next Rodney argues that IFD’s statement that Mr. Tupper would be the IT Specialist and
that he would spend 80% of his time on grant-related duties was false, because Mr. Tupper left the
IT Specialist position after approximately six months. [Filing No. 95 at 17.] The problem with
this argument is that Rodney does not allege or provide evidence that Deputy Chief Stovall knew
that Mr. Tupper would leave prematurely at the time that he made the statement. Indeed, IFD
submits Deputy Chief Stovall’s testimony that he did not know at the time of the grant application
submission that Mr. Tupper would leave. In order to show that Deputy Chief Stovall’s statement
was false, Rodney must show that it was false at the time it was made. U.S. ex rel. Grenadyor v.
Ukrainian Vill. Pharmacy, Inc., 772 F.3d 1102, 1105 (7th Cir. 2014) (“The problem with this part
of [the Plaintiff’s] complaint lies elsewhere: in an insufficient showing that the “I agree” statement
was false when the pharmacy made it. It may have been an honest statement of intentions at the
time, followed by a change of heart, motivated perhaps by greed, that caused the pharmacy to
renege—and in that case the pharmacy would not have made any false statements, but simply have
billed Medicare when it shouldn't have.”) Rodney counters that “[Deputy Chief] Stovall did
nothing to notify FEMA about the change after [Mr.] Tupper left.” [Filing No. 95 at 17.] However,
even if Deputy Chief Stovall were required to make such a notification, any failure to do so would
not retroactively render his prior statement false.
Finally, Rodney argues that there are genuine disputes of material fact as to whether Mr.
Tupper actually devoted 80% of his time to grant-related activities while in the IT Specialist
position, and as to whether Deputy Chief Stovall ever intended for Mr. Tupper to do so. [Filing
No. 95 at 17.] The Court agrees with Rodney that a genuine dispute of material fact exists as to
whether Mr. Tupper spent 80% of his time on grant-related activities. In the cited portions of
deposition testimony, Mr. Tupper could only identify a handful of meetings and at most twelve
phone calls (some occurring before Mr. Tupper moved into the IT Specialist role) as representative
of his work specifically relating to the FEMA grant. [See Filing No. 78-7 at 12-16.] Mr. Tupper
also testified that he did not assist in any data collection or analysis relative to many of the
objectives listed in the grant, such as enhancing clearance rate capacity through improved data
collection, data reporting, and evaluation of arrival times. [Filing No. 78-7 at 25.] When asked
whether he could identify “any project task, assignment, deliverable that [he] completed while [he
was] in the special projects role that was specific to the arson unit,” Mr. Tupper responded that he
could not. [Filing No. 84-15 at 29.] Deputy Chief Stovall also testified that he was not able to
locate any notes, emails, or documents related to any work that Mr. Tupper did regarding the
development of the reporting tool that the grant was aimed at creating. [Filing No. 84-14 at 8.]
This evidence is sufficient to demonstrate a genuine dispute of material fact regarding whether Mr.
Tupper devoted 80% of his time to grant-related activities, as indicated in the grant application.
However, as previously discussed, in order to establish that the 80% statement was false,
Rodney must show that the statement was false when made—not simply that the subject promise
failed to materialize. Rodney has not identified any direct evidence contemporaneous with the
statement at issue that would support the conclusion that the statement was false. Rodney has,
however, pointed to circumstantial evidence that could support the conclusion that Deputy Chief
Stovall never intended for Mr. Tupper to devote 80% of his time to grant-related activities, and
therefore that the statement was false when made. Rodney cites, for example, that Mr. Tupper was
able to identify few grant-related tasks and activities that he worked on. Rodney also points out
that Deputy Chief Stovall tasked Mr. Tupper with several deliverables related to the grant,
including “find[ing] out what the requirements were for the tool that [they] needed to develop for
the arson unit,” [Filing No. 84-14 at 8], creating a “Gantt chart” of project components, [Filing
No. 84-15 at 22-23], and “defining the deliverables” of the grant, [Filing No. 84-15 at 25-26]. Mr.
Tupper did not complete any of those projects, and Deputy Chief Stovall was aware that they were
Rodney also points out that Deputy Chief Stovall could provide no documentary evidence
of any work Mr. Tupper did on the development of the targeted reporting tool. Deputy Chief
Stovall also testified that he did not track or require Mr. Tupper to track the amount of time he
devoted to grant activities, even after being prompted to do so by the Financial Grants Manager
and a representative from the payroll department. [Filing No. 84-14 at 12.] Rodney essentially
contends, pointing to these facts, that a reasonable supervisor in Deputy Chief Stovall’s position
would have known that Mr. Tupper could not have been spending 80% of his time on grant-related
activities, because he had nothing to show for his efforts. Therefore, Rodney argues, it is
reasonable to conclude that Deputy Chief Stovall never intended for Mr. Tupper to devote the
requisite time to grant projects.
The Court reiterates that on summary judgment, it is required to view the facts in the light
most favorable to Rodney, as the non-moving party. It is not the Court’s role to weigh competing
evidence, and the Court makes no determination as to the likelihood of Rodney’s success at trial.
Under this standard, the Court concludes that Rodney has provided sufficient evidence to establish
a genuine dispute of material fact regarding the alleged falsity of IFD’s statement that Mr. Tupper
would devote 80% of his time to grant-related activities.
b. The Requests for Reimbursement
IFD argues that none of its requests for reimbursement contained false statements. It
contends that it only claimed reimbursement for Mr. Tupper’s salary for the time that he actually
worked on the grant, and that IFD did not request reimbursement for any portion of Mr. Tupper’s
salary after 2013. [Filing No. 79 at 19-20.] Rodney responds that even if Mr. Tupper did devote
80% of his time to grant-related work, IFD still overcharged FEMA for that portion of Mr.
Tupper’s salary. 1 [Filing No. 95 at 24.]
IFD’s grant application lists the salary of the IT Specialist as $70,838. [Filing No. 78-2 at
6.] In his email exchange with Mr. Bernal, before the grant was awarded, Deputy Chief Stovall
indicated that Mr. Tupper would serve as the IT Specialist, that his salary was $73,113, and that
Mr. Tupper would devote 80% of his time to grant activities. [Filing No. 78-4 at 3-4.] Mr. Bernal
then clarified that the amount that should actually be requested “in the grant application is
$58,490,” which Deputy Chief Stovall confirmed. [Filing No. 84-10 at 1.] The grant award,
however, lists the amount awarded for the IT Specialist as follows: “For Personnel the IT Specialist
has been reduced from $70,838 to $58,490 due the [sic] IT Specialist will be dedicating 80% of
his time to this project.” [Filing No. 78-5 at 4.] The grant award appears to list the wrong starting
salary—it lists the original grant application amount of $70,838, as opposed to Mr. Tupper’s actual
salary of $73,113. But it lists the correct 80% grant award figure, as calculated by Mr. Bernal
based on Mr. Tupper’s actual salary: $58,490 is 80% of $73,113, not $70,838. 2
IFD requested reimbursement for Mr. Tupper’s services in the amount of $34,816.37.
[Filing No. 78-9 at 1-4.] IFD alleges that it only requested reimbursement for Mr. Tupper’s salary
Rodney also argues that IFD’s reimbursement request was false because IFD was only authorized
to claim reimbursement for the percentage of time that Mr. Tupper actually devoted to grantrelated work, and that percentage (as described above) was less than 80%. [Filing No. 95 at 24.]
The Court need not address this argument, because it concludes that a genuine dispute of material
fact exists as to the amount of reimbursement, even assuming that Mr. Tupper devoted 80% of his
time to grant work.
The Court highlights this discrepancy for the sake of clarity and because it appears to have been
overlooked by the parties, given that IFD references the $70,838 figure as the starting point for the
during the months he worked on the project in 2013, from July through December. [Filing No.
78-9 at 4.] Assuming that Mr. Tupper fulfilled his 80% obligation, Rodney argues, IFD should
only have claimed reimbursement for 80% of Mr. Tupper’s salary during the six months he worked
as the IT Specialist. His $73,113 salary prorated to six months amounts to $36,556.50. 80% of
that amount is $29,245.20, not the $34,816.37 requested by IFD, representing a difference of
IFD does not respond directly to Rodney’s argument regarding the apparent discrepancy,
and it does not explain or cite any evidence as to how it determined the amount it would submit
for reimbursement. Under these circumstances, the Court concludes that genuine issues of material
fact exist as to whether IFD’s reimbursement request contained a false statement.
2. Knowledge of Falsity
To be liable under the FCA, IFD “must have acted with actual knowledge, or with
deliberate ignorance or reckless disregard to the possibility” that its representations were false.
Thulin v. Shopko Stores Operating Co., LLC, 771 F.3d 994, 1000 (7th Cir. 2014) (internal citations
and quotations omitted). Rodney argues that IFD made both of the statements at issue with
knowledge of their falsity.
a. The 80% Statement
Regarding Deputy Chief Stovall’s statement to Mr. Bernal that Mr. Tupper would spend
80% of his time on grant-related activities, IFD argues that even if that were a false representation,
Deputy Chief Stovall did not make it knowingly. [Filing No. 79 at 15.] IFD contends that Deputy
Chief Stovall did not know that Mr. Tupper would vacate the IT Specialist position midway
through the grant period. [Filing No. 79 at 16.] Rodney responds that, even assuming that Deputy
Chief Stovall did not know that Mr. Tupper would leave the IT Specialist position during the grant
period, the evidence supports the conclusion that Deputy Chief Stovall never intended for Mr.
Tupper to devote 80% of his time to grant-related work while he was there. 3 [Filing No. 95 at 20.]
For the same reasons described by the Court in evaluating the alleged falsity of the 80%
statement, the Court concludes that a genuine dispute of material fact exists as to whether Deputy
Chief Stovall knew of its falsity. The parties dispute whether Deputy Chief Stovall ever intended
for Mr. Tupper to devote 80% of his time to grant-related activities, and if he did not, then a
reasonable jury could conclude that Deputy Chief Stovall knowingly made a false statement. As
described above, evidence supporting the conclusion that Deputy Chief Stovall did not intend for
Mr. Tupper to devote 80% of his time to grant activities include: that Mr. Tupper was able to
identify few grant-related tasks and activities that he worked on; that Deputy Chief Stovall tasked
Mr. Tupper with several deliverables related to the grant, and none were completed; that Deputy
Chief Stovall could provide no documentary evidence of work Mr. Tupper did on the development
of the targeted reporting tool; and that Deputy Chief Stovall did not track or require Mr. Tupper to
track whether Mr. Tupper was dedicating 80% of his time to grant activities, even after prompting
to do so by the Financial Grants Manager and a representative from the payroll department. This
showing is sufficient to survive summary judgment on this element.
Rodney also argues that a knowing misrepresentation is clear because IFD failed to employ an
IT Specialist at all (based on Mr. Tupper not being assigned “traditional” tech support functions).
[Filing No. 95 at 19.] As described above, this argument is unpersuasive, and the Court need not
address it again here. Likewise, Rodney contends that Deputy Chief Stovall was “deliberately
ignorant or in reckless disregard of the time [Mr.] Tupper actually spent on the FP&S Grant.”
[Filing No. 95 at 19.] As discussed above, Rodney must show that the statement was false when
made—not simply that the subject promise failed to materialize. So Deputy Chief Stovall’s failure
to monitor Mr. Tupper, or to ensure that he actually devoted 80% of his time to the grant, is relevant
only to the extent that it provides evidence of Deputy Chief Stovall’s intent at the time the
statement was made.
b. The Request for Reimbursement
IFD argues that, assuming there were any false statements in its reimbursement request,
Rodney cannot establish a genuine dispute of material fact regarding whether they were knowingly
submitted for two reasons: (1) “none of the requests identified specific expenses that could be
construed as representations that specific goods or services were purchased or provided by IFD in
the timeframe covered by the request[;]” and (2) “the Plaintiffs did not depose any IFD personnel
involved with drafting or submitting the requests, which means he has no evidence of IFD’s
knowledge at the time the requests were submitted.” [Filing No. 79 at 22.] Rodney responds that
IFD’s choice not to identify specific expenses in its reimbursement request does not preclude him
from being able to prove that IFD claimed reimbursement for services not rendered. [Filing No.
95 at 27.] Rodney also argues that he is under no obligation to provide deposition testimony in
order to support his claim at the summary judgment stage. [Filing No. 95 at 27.] In reply, IFD
argues that Rodney must identify the specific individual alleged to have known that the statement
was false, and that the knowledge of falsity cannot be attributed to IFD as a whole. [Filing No. 86
at 7.] IFD argues that Rodney has not specifically identified such a person, and therefore his claim
must fail. 4 [Filing No. 86 at 7.]
The Court concludes that Rodney has submitted sufficient evidence to survive summary
judgment as to whether any false reimbursement requests were knowingly submitted. First, the
IFD raises this argument for the first time in its reply brief, and arguments raised for the first time
in reply are deemed waived. United States v. Dabney, 498 F.3d 455, 460 (7th Cir. 2007). In the
relevant section of IFD’s brief in support of summary judgment, IFD itself consistently refers to
the “knowledge of the IFD,” and nowhere mentions an individual knowledge requirement. [See,
e.g., Filing No. 79 at 22.] The Court also notes that IFD cites only to out-of-circuit case law in
support of its contention that Rodney must identify an individual with the requisite knowledge.
Such citations are not binding on this Court, and because the argument was raised first in reply,
the Court will not consider it further.
Court rejects IFD’s argument that because IFD did not itemize its specific reimbursement requests,
Rodney cannot prove that a false statement was knowingly made. If the Court understands IFD’s
argument, IFD contends that because it did not specifically state which portion of the
reimbursement request covered Mr. Tupper’s salary, it was not making a representation to FEMA
as to that specific reimbursement. But the grant specified that “IFD was only permitted to charge
all or a portion of Benjamin Tupper’s salary to the FP&S award for the purpose of performing the
type of work identified in the terms and conditions of the FP&S award.” [Filing No. 78-6 at 3.]
Whether IFD requested this salary reimbursement on its own or aggregated it with other expenses
says nothing about the propriety of the request: the grant terms still dictate what expenses are
Second, IFD cannot maintain that because it did not itemize the reimbursements, it did not
know the amount being claimed for Mr. Tupper’s salary. IFD specifically identified, and thus had
knowledge of, which reimbursement requests covered Mr. Tupper’s salary. Ms. Sykes’ affidavit
states that $34,816.37 of Mr. Tupper’s 2013 salary was tagged for reimbursement, and that these
funds were “covered by the request for reimbursement [she] submitted on May 30, 2014.” [Filing
No. 78-9 at 3-4.] So regardless of whether IFD chose to itemize its reimbursement request, it
specifically identifies what portion of the reimbursement request reflects Mr. Tupper’s salary. The
Court notes that were it to accept IFD’s argument on this point, an entity could knowingly submit
false reimbursement requests and evade liability simply by submitting those requests as lump
sums. The Court cannot conclude that the statute contemplates such a result.
As to IFD’s second argument, that the Plaintiffs did not depose any IFD personnel involved
with drafting or submitting the requests, and therefore cannot provide any evidence of knowledge,
the Court finds this argument unpersuasive. The affidavit of Ms. Sykes, who was involved in the
drafting and submission of the reimbursement requests, provides direct evidence in support of
central factual allegations, such as the reimbursement amounts, as described above. This is a
sufficient showing at the summary judgment stage.
Rodney has made the required showing at this stage, and the Court concludes that a genuine
dispute of material fact exists as to whether any reimbursement requests were knowingly and
IFD argues that neither of the allegedly false statements were material to FEMA’s decisions
regarding the award or payment of grant funds. IFD contends that Deputy Chief Stovall’s email
to Mr. Bernal detailing Mr. Tupper’s salary and 80% time commitment cannot have been material
to FEMA’s decision-making, because FEMA had already decided to award the grant when those
representations were made.
[Filing No. 79 at 16.]
IFD also argues that the requests for
reimbursement could not have been material to FEMA’s payment decisions, because FEMA
reviewed the final closeout report and did not take issue with any of IFD’s requested payments.
[Filing No. 79 at 23.] Rodney responds that these representations were material, because the
affidavit submitted by FEMA’s representative confirms that those statements were capable of
influencing FEMA’s decisions. [Filing No. 95 at 28.]
The Court addresses this argument succinctly, because it agrees with Rodney that the
affidavit of Margaret Wilson, FEMA’s Section Chief for the Staffing for Adequate Fire and
Emergency Response Grants, at the very least establishes a genuine dispute regarding the
materiality of the statements at issue. Ms. Wilson attested that:
“FEMA relied on the accuracy of IFD’s material representations in its grant
application when deciding whether to award the grant to IFD.” [Filing No. 78-3
“If FEMA had been aware that IFD used FP&S funds to pay for a portion of an
IFD employee’s salary for the purpose of performing the duties of an IT Specialist
as described in the FP&S grant award, and that employee was not actually
performing those duties, or not performing those duties at least at the rate IFD
charged to the FP&S grant award, this would have influenced, or been capable of
influencing, FEMA’s decision to award the grant or to pay money to IFD under
the grant.” [Filing No. 78-3 at 2-3.]
The Court concludes that a genuine dispute of fact exists regarding the materiality of the allegedly
For the reasons described above, the Court concludes that genuine disputes of material fact
exist regarding the three required elements of Rodney’s claims. Therefore, the Court denies IFD’s
Motion for Summary Judgment as to Rodney’s claims under § 3720(a)(1)(B) and § 3720(a)(1)(A).
B. Retaliation Claim
IFD also moves for summary judgment on Quinn Heath’s claim that IFD failed to hire him
in retaliation for his father having filed this qui tam action. IFD argues that Quinn lacks standing
to bring a claim under 31 U.S.C. § 3730(h), because he has never been an “employee” of IFD, and
therefore he is not covered by the statute’s protections. [Filing No. 79 at 24.] Quinn acknowledges
that the Seventh Circuit has not specifically addressed whether a job applicant may raise a claim
as an “employee” under the statute, and he encourages this Court to adopt an interpretation of the
statute’s terms that includes coverage of applicants. [Filing No. 95 at 29-30.]
The statute provides that:
(1) In general.--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.
(2) Relief.--Relief under paragraph (1) shall include reinstatement with the same
seniority status that employee, contractor, or agent would have had but for the
discrimination, 2 times the amount of back pay, interest on the back pay, and
compensation for any special damages sustained as a result of the discrimination,
including litigation costs and reasonable attorneys' fees. …
31 U.S.C. § 3730(h). Beginning with the plain language of Section 3730(h)(1), it provides relief
for employees, contractors, or agents who are discriminated against due to participating in a qui
tam action. The Oxford English Dictionary defines an employee as “a person who works for an
employer; spec. a person employed for wages or a salary under an employment contract, esp. at
non-executive level.” Oxford English Dictionary (5th ed. 1964). Or, to quote a slightly more
legalistic definition, an employee is “[s]omeone who works in the service of another person (the
employer) under an express or implied contract of hire, under which the employer has the right to
control the details of work performance.” Black’s Law Dictionary (10th ed. 2014). Under either
variant, the plain meaning of the term does not include an applicant, who is someone who seeks to
become, but is not yet, employed.
In considering the same question, the Sixth Circuit conducted a review of the legislative
history of the relevant provision. That court concluded, and this Court agrees, that the legislative
history of the provision does not support expanding the statute’s express terms by adding
applicants to the list of covered persons. Vander Boegh v. EnergySolutions, Inc., 772 F.3d 1056,
1062-64 (6th Cir. 2014) (concluding the “body of case law and legislative history reinforces our
conclusion that the FCA does not extend to non-employee applicants”). Moreover, the available
remedies listed by the statute reinforce the conclusion that applicants are not among those
contemplated by the statute. The statute states that the remedy shall include “reinstatement with
the same seniority status that employee, contractor, or agent would have had but for the
discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for
any special damages…” 31 U.S.C. § 3730(h)(2). Quinn is not eligible for reinstatement or back
pay, because he was never employed or paid by IFD.
Quinn points to Haka v. Lincoln County, 533 F. Supp. 2d 895, 917 (W.D. Wis. 2008), as
supporting his position that the statute encompasses applicants. However, in that case, the plaintiff
was a former employee of the defendant and alleged retaliatory discharge and failure to rehire.
The district court in that case addressed only the question of whether the term “employee”
encompassed former employees when the complained-of action included an allegedly retaliatory
failure to rehire. Those facts are far removed from the facts of this case, as Quinn was never an
employee and was not seeking rehire, and therefore the Court concludes that Haka is inapplicable
to the instant matter. 5
For these reasons, the Court concludes that Quinn Heath lacks statutory standing to bring
a claim under 31 U.S.C. § 3730(h), and IFD’s motion for summary judgment as to that claim is
For the foregoing reasons, the Court DENIES IFD’s Motion for Summary Judgment as to
Rodney Heath’s claims under 31 U.S.C. § 3720(a)(1)(B) and 31 U.S.C. § 3720(a)(1)(A) and
GRANTS IFD’s Motion for Summary Judgment as to Quinn Heath’s claim under 31 U.S.C.
Moreover, the Court also notes that while the Haka court evaluated this issue under the rubric of
whether the term “employee” applied to a former employee seeking to be rehired, the Court is not
convinced that this is the proper inquiry. By its terms, the statute appears to contemplate actions
raised by former employees, in that it includes “discharge” as an actionable form of discrimination.
The statute does not, however, enumerate failure-to-rehire in the list of prohibited employment
actions. So the more appropriate inquiry in a failure-to-rehire scenario may be whether such an
action is encompassed within the statute’s catch-all provision, which prohibits the employer from
“in any other manner discriminat[ing] against [the employee] in the terms and conditions of
employment.” 31 U.S.C. § 3730(h)(1). Because that issue is not before the Court, it need not be
§ 3730(h). [Filing No. 78.] No partial judgment shall issue at this time, and the Court requests
that the Magistrate Judge confer with the parties regarding possible resolution of the remaining
April 24, 2017
Christopher S. Stake
DELANEY & DELANEY LLC
Kathleen Ann DeLaney
DELANEY & DELANEY LLC
FILLENWARTH DENNERLINE GROTH & TOWE LLP
Kathryn M. Box
OFFICE OF CORPORATION COUNSEL
Richard G. McDermott
OFFICE OF CORPORATION COUNSEL
Thomas J.O. Moore
OFFICE OF CORPORATION COUNSEL
Jonathan A. Bont
UNITED STATES ATTORNEY'S OFFICE
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