United States Of America, et al v. Davis S.R. Aviation, et al

Filing 76

ORDER GRANTING Defendants Challenger Repair Group, LLC, Davis S.R.Aviation, Davis S.R. Aviation, LLC, and Steve Davis's 54 Motion to Dismiss for Failure to State a Claim; DISMISSING Defendant Bombardier Inc.'s 55 Motion to Dismiss ; G RANTING Defendant Northrop Grumman Corporation's 57 Motion to Dismiss ; GRANTING Defendant Bombardier Inc.'s 58 Amended Motion to Dismiss ; DENYING Gage's 59 Motion for Leave to File a Corrected Third Amended Complaint to Name a Real Party in Interest and Extension of Time to File All Memorandums in Opposition to Motions to Dismiss at One Time and Name Additional Related Defendants; DENYING Gage's 62 Motion for Leave to File a Corrected Reply to Defendants' Mo tion to Dismiss; DENYING Gage's 67 Motion for Evidentiary Hearing, or in the Alternative a Hearing to Respond to Motions to Dismiss; DISMISSING Davis Defendants' 75 Motion for Sanctions. IT IS FINALLY ORDERED that all claims brought by Relator George Gage in the above-styled cause are DISMISSED WITH PREJUDICE. Signed by Judge Sam Sparks. (klw)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF
AUSTIN DIVISION

TE4jlj -2

_9:07

CLERK US DISTRiCT COURT

WESTERN DISTRiCT

UNITED STATES OF AMERICA ex rel. George
Gage,
Relator,
-vs-

BY

TEXAS

05

DEPUTY

Case No. A-12-CA-904-SS

DAVIS S.R. AVIATION; DAVIS S.R.
AVIATION, LLC; CHALLENGER REPAIR
GROUP, LLC; ORION AIR GROUP LLC;
BOMBARDIER INC.; NORTHROP GRUMMAN
CORP.; and STEVE DAVIS,
Defendants.

ORDER
BE IT REMEMBERED on this day the Court reviewed the file in the above-styled cause, and

specifically Defendants Challenger Repair Group, LLC, Davis S.R. Aviation, Davis S.R. Aviation,
LLC, and Steve Davis's (collectively, the Davis Defendants) Motion to Dismiss [#54], Relator

George Gage's Omnibus Response [#61], and the Davis Defendants' Reply [#66]; Defendant

Bombardier Inc.'s Motion to Dismiss [#55], Bombardier's Amended Motion to Dismiss [#58],

Gage's Omnibus Response [#6 1], and Bombardier's Reply [#69]; Defendant Northrop Grumman
Corporation's Motion to Dismiss [#57], Gage's Omnibus Response [#61], and Northrop Grumman's
Reply [#68]; Gage's "Opposed Motion for Leave of Court to File a Corrected Third Amended

Complaint to Name a Real Party in Interest and Extension of Time to File All Memorandums in
Opposition to Motions to Dismiss at One Time and Name Additional Related Defendants" [#5 9],
Northrop Grumman's Response [#60], Bombardier's Response [#63], and the Davis Defendants'

V

Response [#64]; Gage's "Motion for Leave of Court to File a Corrected Reply to Defendants'

Motions to Dismiss" [#62], the Davis Defendants' Response [#65]; Gage's "Motion Requesting
Evidentiary Hearing, or in the Alternative a Hearing to Respond to Motions to Dismiss, leave of
Court to File a Corrected Third Amended Complaint and Motion in the Alternative for Leave of
Court to File a Fourth Amended Complaint" [#67], Bombardier's Response [#70], and the Davis

Defendants' Response [#71]; and the Davis Defendants' Motion for Sanctions [#75]. Having

reviewed the documents, the governing law, and the file as a whole, the Court now enters the
following opinion and orders GRANTING Defendants' motions to dismiss and dismissing this case
with prejudice.

Background
This is a False Claims Act case concerning the salvaging of aircraft parts for resale to the
Government for use in military aircraft. Beyond that basic premise, the specifics of the case are
largely unknown to the Court. After holding a hearing on a prior round of motions to dismiss, the

Court dismissed the Second Amended Complaint without prejudice, finding the pleading "nigh

unintelligible," full of irrelevant, inflammatory, and inappropriate statements, and missing any facts
tending to show the existence of any plausible False Claims Act claim. See Order of Feb. 14, 2014
[#40], at 2-3.

Gage accepted the Court's invitation to replead and filed a forty-seven page Third Amended

Complaint [#46]. As best the Court can tell, the allegations in this case center around the salvaging

of parts from a previously crashed aircraft, known as Aircraft 9211. The Davis Defendants
apparently purchased the crashed aircraft, salvaged parts from it, repaired or tested those parts, and
sold them on to military subcontractors for use in military aircraft in Afghanistan. Gage, represented
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by his counsel in this case, previously served as an expert witness in a previous suit brought by some

of the Davis Defendants against Rolls-Royce concerning the repair and sale of two engines from
Aircraft 9211. See Davis SR Aviation, LLC v. Rolls-Royce Deutschland, Ltd., No. 1:1 0-C V-003 67LY (W.D. Tex. Apr. 24, 2012). Gage contends the parts acquired by the Davis Defendants were not
airworthy, and some combination of these Defendants conspired to sell the parts to the Government

in violation of contractual or regulatory requirements.
Despite its length, the Third Amended Complaint is no more effective at pleading a False
Claims Act claim than the prior complaints. This case has been pending in this Court since

September 27, 2012. Gage has been given ample time and multiple opportunities to plead his case.
He was previously instructed his Third Amended Complaint would be his "final opportunity" to

plead the facts necessary to survive a Rule 12 motion. Order of Feb. 14, 2014 [#40], at 3. Gage has
instead chosen to continue his pattern of scattershot pleadings. His responses are generally untimely,
and followed almost immediately by requests to correct them or requests for additional time to

respond. Most are accompanied by seemingly random documents attached as exhibits. Gage

continues to insist on having an "evidentiary hearing," despite the posture of this case at the Rule
12 stage.' Ifthere is a legitimate False Claims Act case buried underneath this mess, the Court cannot

find it. For the reasons stated below, this case is dismissed.

Analysis
I.

Legal Standards

At the Court's prior hearing, Gage's counsel insisted on making an "offer of proof' in support of his Second
Amended Complaint. Because Rule 12 motions test the sufficiency ofthe pleadings, not the evidence, the Court declined
the invitation.

Federal Rule of Civil Procedure 8(a)(2) requires a complaint to contain "a short and plain

statement of the claim showing that the pleader is entitled to relief."

FED.

R. Civ. P. 8(a)(2). A

motion under Federal Rule of Civil Procedure 12(b)(6) asks a court to dismiss a complaint for
"failure to state a claim upon which relief can be granted."

FED.

R. Civ. P. 12(b)(6). The plaintiff

must plead sufficient facts to state a claim for relief that is facially plausible. Ashcroft v. Iqbal, 556

U.s. 662, 678 (2009); Bell At!. Corp.

v.

Twombly, 550 U.S. 544, 570 (2007). "A claim has facial

plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged." Iqba!, 566 U.S. at 678. Although
a plaintiff's factual allegations need not establish that the defendant is probably liable, they must

establish more than a "sheer possibility" that a defendant has acted unlawfully. Id. Determining

plausibility is a "context-specific task," and must be performed in light of a court's "judicial
experience and common sense." Id. at 679.
In deciding a motion to dismiss under Rule 12(b)(6), a court generally accepts as true all
factual allegations contained within the complaint. Leatherman

v.

Tarrant Cnty. Narcotics

Intelligence & Coordination Unit, 507 U.s. 163, 164(1993). However, a court is not bound to accept
legal conclusions couched as factual allegations. Papasan

v.

Allain, 478 U.S. 265, 286 (1986).

Although all reasonable inferences will be resolved in favor of the plaintiff, the plaintiff must plead

"specific facts, not mere conclusory allegations." Tuchman v. DSC Commc 'ns Corp., 14 F .3 d 1061,
1067 (5th Cir. 1994). In deciding a motion to dismiss, courts may consider the complaint, as well
as other sources such as documents incorporated into the complaint by reference, and matters of

which a court may take judicial notice. Tellabs, Inc.
322 (2007).

-4-

v.

Makor Issues & Rights, Ltd., 551 U.S. 308,

In addition to these basic pleading requirements, "claims brought under the FCA must

comply with the particularity requirements ofRule 9(b)." US. ex rel. Steury v. Cardinal Health, Inc.,
625 F.3d 262, 266 (5th Cir. 2010) (Steury 1). "Rule 9(b) requires, at a minimum, that a plaintiff set

forth the who, what, when, where, and how of the alleged fraud." Id. (internal quotation marks

omitted).

II.

Application
The Defendants' motions advance two separate lines of argument against the Third Amended

Complaint. First, Defendants contend the claims in this case are barred by the FCA' s "public
disclosure bar," and Gage is therefore precluded as a matter of law from prosecuting them. Second,
and alternatively, Defendants contend Gage has failed to plead sufficient facts to meet Rule 9(b)' s

particularity requirements.
A.

Public Disclosure Bar
The vast majority of Gage's allegations concern false claims submitted before March 23,

2010.2

The FCA's 1986 public disclosure bartherefore applies to most of Gage's claims.3 The 1986

public disclosure bar provides:

2

have identified four specific allegedly false claims made after March23, 2010: (1) an alleged sale
of a variable frequency generator by Davis S.R. Aviation (doing business as Challenger Spares and Support, or CSS)
to Orion Air Group, LLC, on September 10, 2010; (2) the sale of a generator control unit on April 6, 2010; (3) the sale
of a Cabin Pressure Controller on April29, 2010; and (4) the exchange of two brake assemblies by CSS with Orion on
September 6,2011.
The public disclosure bar was amended on March 23, 2010, but the amendments "do not apply retroactively
to suits pending at the time they became effective." US. ex rel. Jamison v. McKesson Corp., 649 F.3d 322, 326 n.6 (5th
Cir. 2011). Although Gage did not file this suit until 2012, the bulk of his claims accrued prior to the 2010 amendments.
The Court therefore applies the 1986 version ofthe statute to all but the four allegedly false claims presented after March
23, 2010. See US. ex rel. May v. Purdue Pharma L.P., 737 F.3d 908, 918 (4th Cir. 2013) (applying 1986 version of
statute to action commenced after the 2010 amendments butconcerning fraudulent conduct between 1996 and 2005);
US. ex rel Harman v. Trinity Indus., Inc., No. 2:12-CV-00089-JRG, 2014 WL 47258, at *3 (ED. Tex. Jan. 6, 2014)
("[C]laims accruing before March 23, 2010 (the effective date of the new disclosure bar)are subject to the old [1986]
disclosure bar; claims accruing since that date are subject to the newer version of the statute.").

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No court shall have jurisdiction over an action under this section based upon the
public disclosure of allegations or transactions in a criminal, civil, or administrative
hearing, in a congressional, administrative, or Government Accounting Office report,
hearing, audit, or investigation, or from the news media, unless the action is brought
by the Attorney General or the person bringing the action is an original source of the
information.
31 U.S.C. § 373 O(e)(4)(A)

(1986). Under this version of the statute, the relevant questions are "1)

whether there has been a 'public disclosure' of allegations or transactions, 2) whether the qui tam

action is 'based upon' such publicly disclosed allegations, and 3) if so, whether the relator is the

'original source' of the information." Fed. Recovery Servs., Inc.

v.

United States, 72 F.3d 447, 450

(5th Cir. 1995).
The Fifth Circuit has held "any information disclosed through civil litigation and on file with
the clerk's office should be considered a public disclosure of allegations in a civil hearing for

purposes of section 373 O(e)(4)(A)." Id. (internal quotation marks and alteration omitted). "This
includes civil complaints." Id. It is not necessary for the exact allegations made in the qui tam case
to have been made before. A public disclosure is made if the Government could "draw an inference

of fraud" from disclosure of the "critical elements" of the fraudulent transaction. US. ex rel. Colquitt
v.

Abbott Labs., 864 F. Supp. 2d 499, 519 (N.D. Tex. 2012) (internal quotation marks omitted).
The allegations in the qui tam action need not be identical for purposes of the second element

of this test, either. As the Fifth Circuit has explained, "if a qui tam action is even partly based upon
public allegations or transactions then the jurisdictional bar applies." US. ex rel. Fried v. West Indep.
Sch. Dist., 527 F.3d 439,442 (5th Cir. 2008) (internal quotation marks omitted). Applying this rule,

the Fifth Circuit has held a qui tam suit was "based upon" publicly disclosed allegations even where

the qui tam suit and the previous disclosure had "only one instance of fraud" in common. Fed.

Recovery Servs., 72 F.3d at 451.
Finally, the FCA defines an "original source" as an individual who "has voluntarily disclosed
[prior to any public disclosure] to the Government the information on which the allegations or

transactions in a claim are based," or who "has knowledge that is independent of and materially adds
to the publicly disclosed allegations or transactions, and who has voluntarily provided the
information to the Government before filing an action under this section." 31
§

U.s.c.

3730(e)(4)(B). "Knowledge is direct if it is derived from the source without interruption or gained

by the relator's own efforts rather than learned second-hand through the efforts of others." US. ex
rel. Jamison

v.

McKesson Corp., 649 F.3d 322, 332 (5th Cir. 2011) (internal quotation marks

omitted). "[K]nowledge is independent if it is not derived from the public disclosure." Id. (internal

quotation marks omitted).
There was a previous public disclosure of the alleged fraud in this case in the Rolls-Royce

litigation before Judge Yeakel. The public filings (including the complaint and other motions filed
by Rolls-Royce) in that case outline the same basic fraudulent scheme as Gage's pleadings in this
case. In short, the pleadings in the Rolls-Royce case tell the story of the crash of Aircraft 9211, the

acquisition of the wreckage by the Davis Defendants, the improper repair or certification of the parts,

and the subsequent sale or lease of those "unairworthy" parts to government contractors for use in

military aircraft in Afghanistan. This is the exact story which forms the basis for this qui tam action.
It is certainly close enough to allow the Government to draw the same inference of fraud it could
draw from the pleadings in this case, if any exists. To dispel any doubt, Rolls-Royce filed a motion
to dismiss on April 15, 2011, in which it openly accused the Davis Defendants of violating the False
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Claims Act by reselling improperly repaired or certified Rolls-Royce-manufactured engines from

Aircraft 9211 to military contractors. See Bombardier's Am. Mot. Dism. [#58-3], Ex. B (Rolls-

Royce's Motion to Dismiss), at 14 n.8.
There is no disputing this qui tam case is also "based upon" those publicly disclosed

allegations. Although Gage has expanded the scope of the conspiracy to include more than just the

Davis Defendants and more parts than just the Rolls-Royce engines, Gage's allegations are at a

minimum "partly based upon" the allegations made in the Rolls-Royce case. See Fried, 527 F.3d at
442. Indeed, Gage has repeatedly alleged he is unable to disclose certain facts in support of his

claims because he fears being sanctioned by this Court for violating the protective order entered in

the Rolls-Royce case. If Gage's claims were not "based upon" facts uncovered in the Rolls-Royce
case, he would have no need to disclose those facts to support his claims now.

Gage's Third Amended Complaint attempts to avoid the public disclosure bar by alleging he
is an "original source"

of the allegations. Specifically, Gage alleges:

Mr. Gage under the FCA is an "original source" and learned of "suspected
unapproved parts" or "non-conforming" parts as early as August 2011 before
receiving any discovery documents from CSS in the litigation in Case Number 1:10cv-367. Mr. Gage learned of False Claims submissions by review of Rolls-Royce
documents where he served in an investigative and expert capacity for Rolls-Royce
counsel in Case Number 1:1 0-cv-367 LY.
Before Gage ever received any documents produced by CSS or used as an
exhibit in court he was provided a packet of Rolls-Royce information that included
a letter by Rolls-Royce counsel to the Department of Justice dated April 29, 2011
referencing a potential False Claim act case, only 21 days after the filing on April 8,
2011 of a "Protective Order" in Case Number 1 :10-cv-367.
3d Am. Compl. [#46], ¶J 13-14.

Gage intended these allegations to save his case from the public disclosure bar, but instead

they do the opposite. Gage openly admits he learned of the allegedly fraudulent conduct forming the
basis for this case in his capacity as an expert witness for Rolls-Royce in the previous litigation.

Gage's involvement post-dates Rolls-Royce's public disclosures, such as its motion to dismiss in
April 2011, accusing the Davis Defendants of violating the FCA based on their conduct involving

the wreckage of Aircraft 9211. It is impossible for Gage to be an "original source" of allegations he
learned about when serving as an expert witness for a party which had already disclosed the

allegations in the public record.
Gage relies heavily on the fact he allegedly learned about the fraud from Rolls-Royce rather

than from the Davis Defendants. This distinction is meaningless. The relevant question is whether

Gage's knowledge is independent and based upon his own efforts. See Jamison, 649 F.3d at 332.

Gage's own pleading establishes his knowledge is not independent and is a result of Rolls-Royce
providing him documents disclosing the alleged fraud. Gage admits Rolls-Royce even informed the
Government of the allegedfraud by a letter dated April 29, 2011, nearly a year and a half before
Gage filed this suit. Gage is not a whistleblower. He discovered no alleged fraud. Rolls-Royce
discovered the alleged fraud, reported it to the Government, and handed the supporting documents
to Gage months later. Gage is exactly the kind of "parasitic" relator Congress sought to bar from

"seek[ing] remuneration although they contributed nothing to the exposure of the fraud." Graham
Cnly. Soil & Water Conservation Dist.

v.

US. ex rel. Wilson, 559 U.s. 280,296 n. 16(2010) (internal

quotation marks omitted).
All three elements required to invoke the 1986 public disclosure bar are present in this case.
The broad contours of this allegedly fraudulent scheme were previously disclosed in public court

filings, and in a letter sent directly to the Department of Justice, by Rolls-Royce. Gage's allegations
are based on those disclosures; indeed, the pleadings in this case largely parrot many of the public

filings in the Rolls-Royce litigation. Gage cannot possibly be the original source of these allegations,

having discovered them only after Rolls-Royce publicly disclosed themand directly informed the

Government of themand then provided supporting documents to Gage when he was retained to
serve as an expert witness in the Rolls-Royce case. Accordingly, this Court lacks jurisdiction to
consider the vast majority of Gage's claims.
B.

Rule 9(b)
With respect to the four claims not subject to the public disclosure bar, and in the alternative

with respect to those claims which are barred, dismissal is warranted because Gage has failed to
adequately plead fraud with particularity.
First, Gage has inadequately pleaded the "who" of this alleged fraudulent scheme. Gage's

allegations are as generic as possible with respect to each Defendant, alleging "Bombardier" did this
or "Northrop Grumman" did that. The Fifth Circuit requires more of FCA complaints. Gage's task
is to provide "the identity of the person making the misrepresentation." US. ex rel. RaJIzadeh

v.

Continental Common, Inc., 553 F.3d 869, 873 (5th Cir. 2008) (internal quotation marks omitted);
see also US. ex rel. Willardv. Humana Health Plan of Tex. Inc., 336 F.3d 375, 385 (5th Cir. 2003)

(affirming dismissal of FCA claim where relator failed to alleged "who at Humana made" an
allegedly false representation). Gage does not identify any particular false representations or claims

made to the Government, but even if he did, he is never more specific than the names of the
corporate Defendants. Gage's Response rattles off a list of individual employees at the various
Defendants, none of whom are ever mentioned in the Third Amended Complaint, without any facts

!EII!

to support the conclusory allegations they made false

statements.4

This is absurd. The Court has

already warned Gage's counsel to "focus on pleading with particularity the necessary factual

allegations" to state an FCA claim. See Order of Feb. 14, 2014 [#40], at 3. Gage has had years to
draft a complaint which states the "who" of this alleged fraud with particularity. His failure to do so

must now be construed as an inability to do so.
Second, Gage's Third Amended Complaint fails to adequately plead "what" was false about
any alleged claims made by the Defendants. Gage generally alleges the Davis Defendants supplied

Orion with aircraft parts for use in its contracts with Northrop Grumman. Gage then generally alleges

these parts were "unapproved, non-conforming and non-airworthy" because they were not
"maintained to meet type certificate and type design specifications and were from accident related
aircraft." 3d Am. Compl. ¶1J3 8-41. These parts apparently "violated the FAA and FAR regulations
and ultimately the contract terms and conditions," and therefore resulted in false claims being made
to the United States Air Force. Id. ¶ 37.

If Gage seeks to base his FCA claims on the Defendants' alleged failure to comply with some
government contract, he must specify the contractual requirements at issue. See Order of Feb. 14,
2014 [#40], at 2 (deeming Gage's Second Amended Complaint deficient because it "alleges no

contractual terms or obligations, making it impossible to determine if some breach or violation

occurred"). The Fifth Circuit requires a relator claiming non-compliance with a contract to "identify

the contractual provisions" allegedly violated and "reveal[] how the [products] deviated from the
government's specifications." US. ex rel. Steury v. Cardinal Health, Inc., 735 F.3d 202, 206 (5th
Cir. 2013) (Steury II). In Steury I, the Fifth Circuit affirmed a dismissal of FCA claims where the

"With respect to Northrop Grumman, Gage still does not name a single specific individual.

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relator had not pleaded the Government had conditioned payment on a certification of compliance
"with some statute, regulation, or contract provision." 625 F.3d at 269. In Steury II, the Fifth Circuit
again affirmed the dismissal of those claims based on alleged violations of contractual conditions

regarding the merchantability of goods, finding fatal the relator's failure to identify the specific
contractual provisions at issue, explain how the goods did not meet the contract specifications, or
allege that compliance with any particular provision or regulation was "a prerequisite of payment."
735 F.3d at 206-07.

Gage has once again failed to identify any contractual provisions allegedly violated. His
general allegations about parts not "conforming" to the contract are meaningless because he does not

identify what it means to conform to the contract. However, the Third Amended Complaint does
provide an explanation for this lack of detail. Gage concedes the relevant contract between Northrop
Grumman and the United States Air Force, called the Battlefield Airborne Communication Node
System or BACN contract, is classified. 3d Am. Compl. [#461 ¶ 34. Gage has not seen it. He cannot

possibly know what requirements it contains. But that does not stop him from guessing!
Unable to review the actual BACN contract, Gage alleges the contract "included" various
Federal Acquisition Regulations (FAR) and Defense Federal Acquisition Regulation Supplements
(DFARS). Id. ¶ 21,24. Gage makes no effort to explain what requirements any of these regulations

impose on Northrop Grumman. As the Fifth Circuit has explained, "[tjhe FCA is not a general
enforcement device for federal statutes, regulations, and contracts. Not every breach of a federal
contract is an FCA problem." Steury I, 625 F.3d at 268 (citation omitted). Conclusory allegations
the Defendants violated federal regulations will not suffice to state an FCA claim. See Steury II, 735
F.3d at 206 (dismissing FCA claims because "the essence of the fraudulent activity of implied false
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certification of compliance cannot be gauged unless Steury reveals how the Signature pumps

deviatedfrom the government's specflcations" (emphasis added)). "At this point in the litigation,
[Gage] ha[s] to know that merely descriptive or conclusory allegations about the [government]

contracts [are] insufficient." See id. at 207.

Nor does Gage make any effort to explain how any ofthe aircraft parts provided violated the
regulations he citesthe parts were simply "non-conforming." Gage concedes "there is nothing
inherently wrong under the Federal Aviation Administration (FAA) regulations or the Federal

Acquisition Regulations (FAR) with obtaining parts from an accident related aircraft." 3d Am.
Compl. [#46] ¶ 37. Gage does not cite the text of any particular regulation, nor elaborate on how any

individual part failed to conform to these alleged regulatory requirements.
In addition, Steury I held a contract must condition payment on compliance with whatever

regulations were allegedly violated in order to state an FCA claim. Steury I, 625 F.3d at 268. Gage
does not allege the Air Force conditioned its payment on compliance with any ofthe FAR or DFARS

regulations he cites. Additionally, the Fifth Circuit addressed one of the precise FARs referenced in

Gage's Complaint in Steury I. The court noted FAR

§

52.246-2 allowed the Government to accept

non-compliant goods and then pursue other remedies against the breaching party and therefore

"suggests that payment is not conditioned on certification of compliance." Steury I, 625 F.3d at

269-70. One of the DFARS referenced by Gage, DFARS § 264.4, is similar because it incorporates
by reference FAR

§

52.246-2. Nothing in Gage's Third Amended Complaint suggests the Air Force

conditioned payment on compliance with any of these regulations, and Gage's failure to allege as
much is fatal to his claims.

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Gage's Third Amended Complaint also wholly fails to identify any specific false claims, "the
linchpin of an FCA claim." Rafizadeh, 553 F.3d at 873. Gage does not provide "the time, place[,]
and contents of the false representations," as required by Fifth Circuit precedent. Id. (internal
quotation marks omitted). Gage's allegations do not even track the allegedly non-conforming aircraft
parts to the Government. Gage generally alleges the Davis Defendants salvaged the parts and
provided them to Orion, "for use under its subcontract with Northrop Grumman." E.g., 3d Am.
Compi. ¶J 60-65. There the trail ends. Only conclusory allegations trace the parts from Northrop

Grumman to the Government. E.g, id. ¶ 63 ("This resulted in false claims paid to Northrop

Grumman and Orion by the USAF."). Gage must provide more than mere conclusory allegations;

he must, at a minimum, "offer[] particular and reliable indicia that false bills were actually submitted
as a result of the

schemesuch as dates that services were fraudulently provided

or recorded, by

whom, and evidence of the department's standard billing procedure." US. ex rel. Grubbs

v.

Kanneganti, 565 F.3d 180, 189(5th Cir. 2009). Gage has provided no allegations about any specific
claims Northrop Grumman made to the Air Force, or any claims the Air Force allegedly paid to

Northrop Grumman.5
In sum, Gage's allegations do not meet the high standard imposed on FCA claims by Rule
9(b), and therefore must be dismissed.

Conclusion

Gage's pattern of non-allegations against Northrop Grumman, the party who actually contracted with the
Government, as consistent with the source of his knowledge. Because Gage only knows what he learned about the Davis
Defendants and their affiliates (e.g., Bombardier, Orion) in the prior litigation, he has no basis for pleading specific facts
about the end of the supply chain, Northrop Grumman and the Air Force.

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Gage has failed to state any claim for which relief can be granted. To the extent the Court has

jurisdiction over any of his alleged FCA claims, he has failed to satisfy the requirements of Rule 9(b)
and plead his fraud claims with particularity. Gage has had years to refine his pleadings and been

given multiple opportunities to amend. He was warned after his previous complaint was dismissed
for failure to allege sufficient facts that his third try would be his last. Another swing, another miss,
and Gage has struck out. Further leave to amend would be wholly futile. This case is DISMISSED
WITH PREJUDICE.
Accordingly,
IT IS ORDERED that Defendants Challenger Repair Group, LLC, Davis S.R.

Aviation, Davis S.R. Aviation, LLC, and Steve Davis's (collectively, Davis Defendants)

Motion to Dismiss [#54] is GRANTED;
IT IS FURTHER ORDERED that Defendant Bombardier Inc.'s Motion to Dismiss
[#55] is DISMISSED;

IT IS FURTHER ORDERED that Defendant Bombardier Inc.'s Amended Motion
to Dismiss [#58] is GRANTED;
IT IS FURTHER ORDERED that Defendant Northrop Grumman Corporation's
Motion to Dismiss [#57] is GRANTED;
IT IS FURTHER ORDERED that Gage's "Opposed Motion for Leave of Court to

File a Corrected Third Amended Complaint to Name a Real Party in Interest and Extension

of Time to File All Memorandums in Opposition to Motions to Dismiss at One Time and
Name Additional Related Defendants" [#59] is DENIED;

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IT IS FURTHER ORDERED that Gage's "Motion for Leave of Court to File a

Corrected Reply to Defendants' Motions to Dismiss" [#62] is DENIED;
IT IS FURTHER ORDERED that Gage's "Motion Requesting Evidentiary Hearing,

or in the Alternative a Hearing to Respond to Motions to Dismiss, leave of Court to File a

Corrected Third Amended Complaint and Motion in the Alternative for Leave of Court to
File a Fourth Amended Complaint" [#67] is DENIED;

IT IS FURTHER ORDERED that the Davis Defendants' Motion for Sanctions [#75]
is DISMISSED;

IT IS FINALLY ORDERED that all claims brought by Relator George Gage in the

above-styled cause are DISMISSED WITH PREJUDICE.
SIGNED this the

day of July 2014.

UNITED STATES

904 mtd2 ord kkt.frm

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DfRTCT JUDGE