MEMORANDUM AND ORDER - IT IS THEREFORE ORDERED that: Defendants' Motions to Dismiss (filing nos. 40 , 42 , 44 , 48 , and 50 ) are granted, as set forth in this Memorandum and Order. Plaintiff's False Claim Act claim (count I of the Com plaint) is dismissed without prejudice. Plaintiff's retaliation and tortious interference with contractual relationships claims (counts II and III of the Complaint) are dismissed with prejudice. A separate judgment will be entered in accordance with this Memorandum and Order. Ordered by Judge Richard G. Kopf. (Copy mailed to pro se party) (TEL)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
JOHN J. MALONE SR., individually, )
OMAHA HOUSING AUTHORITY, )
BRAD ULRICK, BRAD ASHFORD, )
GEORGE ACHOLA, WILLIAM
BEGLEY, BOB FIDONE,
MICHELLE PETERS, and DONALD )
This matter is before the court on five separate Motions to Dismiss, filed by
Defendants. (Filing Nos. 40, 42, 44, 48, and 50.) As set forth below, the Motions are
BACKGROUND AND SUMMARY OF COMPLAINT
Plaintiff filed his Complaint in this matter against the Omaha Housing
Authority (“OHA”), and seven individuals who are identified in the Complaint as
residents of Omaha, Nebraska and “material to this case.” (Filing No. 1 at CM/ECF
pp. 1-3.) Condensed and summarized, Plaintiff sues Defendants under the federal
False Claims Act (“FCA”). (Id. at CM/ECF p. 2.) Plaintiff alleges that the OHA
administers certain federal funds in “providing affordable housing to those in need.”
(Id. at CM/ECF p. 4.) Since 2005, Plaintiff has provided housing to individuals under
this federal program through private contracts with the OHA. (Id.) Plaintiff alleges
generally that he is a “whistleblower” and that he has reported OHA’s false claims for
payment to the United States. (Id. at CM/ECF pp. 4-6.) Plaintiff also alleges that the
OHA retaliated against him for making such reports by “denying three of his
properties” low-income housing contracts and by sending “inspectors” to his
property. (Id. at CM/ECF pp. 7-8.) Plaintiff further alleges that OHA has interfered
with several contracts between him and his tenants. (Id. at CM/ECF pp. 8-9.)
Defendants have all filed Motions to Dismiss. (Filing Nos. 40, 42, 44, 48, and
50.) Despite having more than two months in which to do so, Plaintiff did not file a
response to any of the pending Motions. The Motions to Dismiss are therefore
deemed fully submitted.
False Claims Act
Plaintiff’s first claim is brought pro se under the FCA. (Filing No. 1.)
Although the FCA is silent on the matter, it has long been the law in the Eighth
Circuit that a pro se plaintiff may not prosecute a qui tam action. United States v.
Onan, 190 F.2d 1, 6-7 (8th Cir. 1951). As set forth in Onan:
[W]e do not think that Congress could have intended to authorize a
layman to carry on such suit as attorney for the United States but must
have had in mind that such a suit would be carried on in accordance with
the established procedure which requires that only one licensed to
practice law may conduct proceedings in court for anyone other than
himself. While the Supreme Court has given this Section 232 a liberal
construction . . . it is unthinkable that Congress by this Act intended to
license laymen to practice law. The practice of law is affected with a
public interest and an attorney at law as distinguished from a layman,
has both public and private obligations, being sworn to act with all good
fidelity toward both his client and the court.
Id. Citing Onan, many other federal circuit courts agree. See U.S. ex rel. Mergent
Servs. v. Flaherty, 540 F.3d 89, 92 (2d Cir. 2008) (“Because relators lack a personal
interest in False Claims Act qui tam actions, we conclude that they are not entitled to
proceed pro se.”); Timson v. Sampson, 518 F.3d 870, 874 (11th Cir. 2008) (holding
that a non-attorney pro se plaintiff may not litigate a qui tam action if the United
States declines to intervene); Stoner v. Santa Clara Cnty. Office of Educ., 502 F.3d
1116, 1126-27 (9th Cir. 2007) (“Because qui tam relators are not prosecuting only
their ‘own case’ but also representing the United States and binding it to any adverse
judgment the relators may obtain, we cannot interpret § 1654 as authorizing qui tam
relators to proceed pro se in FCA actions.”); U.S. ex rel. Lu v. Ou, 368 F.3d 773, 77576 (7th Cir. 2004), overruled on other grounds, 129 S. Ct. 2230 (2009) (holding that
non-attorney pro se litigants may not proceed in a qui tam action on behalf of the
Plaintiff originally filed this matter on October 7, 2009, under seal pursuant to
31 U.S.C. § 3730. (Filing No. 1.) On June 18, 2010, the United States filed its
Notice of Election to Decline Intervention. (Filing No. 26.) In that filing, the United
States stated that it would not intervene in this action and requested that the court
unseal the Complaint. (Id.) The court granted the United States’s request. (Filing
No. 27.) At the time of filing the Complaint, Plaintiff was represented by counsel.
(Filing No. 1.) However, shortly before the United States declined to intervene,
counsel for Plaintiff withdrew and Plaintiff elected to proceed with his claims pro se.
(See Filing Nos. 21, 23, and 25.) There is nothing in the record before the court
showing that Plaintiff is a licensed attorney. As set forth above, the law is clear that
Plaintiff, as a non-attorney, may not prosecute the qui tam claim under the FCA pro
se. As such, the court will dismiss this claim without prejudice to reassertion by the
For his second claim, Plaintiff brings a retaliation claim pursuant to the FCA.
31 U.S.C. § 3730(h). As set forth in that section:
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
Id. Prior to May 20, 2009, this section stated:
Any employee who is discharged, demoted, suspended, threatened,
harassed, or in any other manner discriminated against in the terms and
conditions of employment by his or her employer because of lawful acts
done by the employee on behalf of the employee or others in furtherance
of an action under this section, including investigation for, initiation of,
testimony for, or assistance in an action filed or to be filed under this
section, shall be entitled to all relief necessary to make the employee
whole. Such relief shall include reinstatement with the same seniority
status such employee 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. An employee
may bring an action in the appropriate district court of the United States
for the relief provided in this subsection.
31 U.S.C. § 3730(h), amended by 31 U.S.C. § 3130(h) (2009). Thus, prior to the
2009 amendment, the retaliation provisions of this section applied only to employees.
Further, although the Eighth Circuit has not discussed whether the provision applying
this section to contractors and agents is retroactive, at least one other circuit court has
done so. In Lytle v. Capital Area Intermediate Unit, the Third Circuit determined that
“Congress explicitly provided that the amendment [to §3730] shall take effect on the
date of enactment of this Act and shall apply to conduct on or after the date of
enactment. When, as here, Congress has expressly provided that the statute in
question . . . should not apply retrospectively . . ., then we follow Congress’ express
prescription and apply the statute accordingly. 393 F. App’x 955, 958 (3d Cir. 2010)
(quotations omitted, emphasis added). Because the plaintiffs in Lytle challenged
“only conduct occurring well before 2009,” and were not employees of the defendant,
they were not entitled to the “benefit of the amended version of § 3730(h).” Id. As
such, the Third Circuit affirmed the dismissal of the plaintiffs’ retaliation claims.
Here, Plaintiff’s Complaint alleges a retaliation claim against OHA pursuant
to 31 U.S.C. § 3730(h). (Filing No. 1 at CM/ECF p. 7.) In particular, Plaintiff alleges
that OHA retaliated against him “[o]n November 10, 2006,” and that inspectors
“failed properties” in 2006. (Id.) Plaintiff does not allege that OHA or any other
Defendant engaged in retaliatory conduct at any point after May 20, 2009. (Id. at
CM/ECF pp. 7-8.) In addition, Plaintiff does not allege that he is an employee of any
Defendant. Rather, the Complaint reveals that Plaintiff’s only relationship to
Defendants is that he “directly manag[es] residential real estate rental properties” and
has engaged in contracts with OHA. (Id. at CM/ECF pp. 1-4.) As set forth above,
prior to May 20, 2009, the anti-retaliation provisions of 31 U.S.C. § 3730 were
limited to employees, and the May 20, 2009 amendments were not retroactive. As in
Lytle, because Plaintiff alleges only pre-May 20, 2009, conduct and because he is not
an employee, he cannot bring a retaliation claim under 31 U.S.C. § 3730 and this
claim is dismissed with prejudice.
Tortious Interference with Contracts
For his third and final claim, Plaintiff alleges that Defendants tortiously
interfered with contracts between him and his tenants. (Filing No. 1 at CM/ECF pp.
8-9.) Defendants are either a political subdivision or employees of a political
subdivision. See Neb. Rev. Stat. § 71-15,168 (2010); Neb. Rev. Stat. § 13-903
(2010). As such, Plaintiff’s claims are governed by the Political Subdivisions Tort
Claims Act (the “PSTCA”). The PSTCA “reflects a limited waiver of governmental
immunity and prescribes the procedure for maintenance of a suit against a political
subdivision.” Hatcher v. Bellevue Fire Dep’t, 628 N.W.2d 685, 691 (Neb. 2001); see
also Neb. Rev. Stat. § 13-902 (2010). In addition, in Nebraska, the PSTCA “is the
exclusive means by which a tort claim may be maintained against a political
subdivision or its employees.” Jessen v. Malhotra, 665 N.W.2d 586, 590 (Neb.
2003). However, “[a] political subdivision retains its sovereign immunity with
respect to certain listed exceptions found in the PSTCA.” Doe v. Omaha Pub. Sch.
Dist., 727 N.W.2d 447, 454 (Neb. 2007). Where “a plaintiff’s claim comes within an
exception pursuant to [the PSTCA], then the claim fails based on sovereign immunity,
and the political subdivision is not liable.” Id. The PSTCA expressly states that
“any claim arising out of . . . interference with contract rights,” is excepted from the
PSTCA and political subdivisions and their employees are not liable based on such
claims. Neb. Rev. Stat. § 13-910.
Plaintiff’s third claim is titled “OHA’s Tortious Intereference With Plaintiff’s
Existing Contractual Relationships” and claims that Defendants interfered with four
separate contracts between Plaintiff and his tenants. (Filing No. 1 at CM/ECF pp. 89.) This “tortuous [sic] interference” caused Plaintiff to suffer financial losses. (Id.
at CM/ECF p. 9.) It is clear that Defendants are either a political subdivision or
employees of a political subdivision in Nebraska. It is equally clear that Defendants
enjoy sovereign immunity from claims for tortious interference with contracts under
the PSTCA. As such, this claim is also dismissed.
IT IS THEREFORE ORDERED that:
Defendants’ Motions to Dismiss (filing nos. 40, 42, 44, 48, and 50) are
granted, as set forth in this Memorandum and Order. Plaintiff’s False Claim Act
claim (count I of the Complaint) is dismissed without prejudice. Plaintiff’s
retaliation and tortious interference with contractual relationships claims (counts II
and III of the Complaint) are dismissed with prejudice.
A separate judgment will be entered in accordance with this
Memorandum and Order.
DATED this 14th day of April, 2011.
BY THE COURT:
Richard G. Kopf
United States District Judge
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