520 F.3d 384 (5th Cir. 2008), 06-31238, United States ex rel. Marcy v. Rowan Companies, Inc.

Docket Nº:06-31238.
Citation:520 F.3d 384
Party Name:UNITED STATES of America, ex rel., Robert Daniel MARCY, on behalf of the United States of America, c/o James Letten & John Ashcroft, Plaintiff-Appellant, v. ROWAN COMPANIES, INC.; Newfield Exploration Gulf Coast, Inc., formerly known as EEX Corporation; Newfield Exploration Co.; Remington Oil & Gas Corp., Defendants-Appellees.
Case Date:March 05, 2008
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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520 F.3d 384 (5th Cir. 2008)

UNITED STATES of America, ex rel., Robert Daniel MARCY, on behalf of the United States of America, c/o James Letten & John Ashcroft, Plaintiff-Appellant,

v.

ROWAN COMPANIES, INC.; Newfield Exploration Gulf Coast, Inc., formerly known as EEX Corporation; Newfield Exploration Co.; Remington Oil & Gas Corp., Defendants-Appellees.

No. 06-31238.

United States Court of Appeals, Fifth Circuit.

March 5, 2008

Page 385

[Copyrighted Material Omitted]

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David Bradley Marvel (argued), Robertson & Hollingsworth, Charleston, SC, Conlee

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Schell Whiteley, Kanner & Whiteley LLC, New Orleans, LA, for Plaintiff-Appellant.

Jonathan Saul Franklin (argued), Matthew H. Kirtland, Fulbright & Jaworski, Washington, DC, Steven L. Roberts, Sutherland, Asbill & Brennan LLP, Houston, TX, for Rowan Companies, Inc.

James H. Roussel, Baker, Donelson, Bearman, Caldwell & Berkowitz, New Orleans, LA, for Newfield Exploration Gulf Coast, Inc. and Newfield Exploration Co.

Dennis N. Ryan, Mark A. Shoffner, Andrews & Kurth, Dallas, TX, C. Peck Hayne, Jr., Scott Allen O'Connor, Gordon, Arata, McCollam, Duplantis & Eagan, New Orleans, LA, for Remington Oil & Gas Corp.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before BARKSDALE, DENNIS and SOUTHWICK, Circuit Judges.

SOUTHWICK, Circuit Judge:

Robert Daniel Marcy challenges the district court's dismissal of the qui tam action that he brought on behalf of the United States under the False Claims Act. We affirm the judgment of dismissal.

FACTS

On December2, 2003, Robert Marcy filed suit against Newfield Exploration Gulf Coast, Inc., Newfield Exploration Company, Rowan Companies, Inc., and Remington Oil and Gas Corporation ("Defendants"). Marcy alleges that, while employed on Defendants' Midland offshore drilling unit, he was ordered by Defendants to illegally dump oil, oil waste, solid waste, grease, paint, and other hazardous substances into the Gulf of Mexico at night. Marcy contends that Defendants' actions violated the Federal Water Pollution Control Act ("FWPCA") and the Act to Prevent Pollution from Ships ("APPS"), that Defendants intentionally failed to report the discharge of oil or hazardous substances as required by those two enactments, and that Defendants intentionally omitted a record of the discharges both from the "Oil Record Book" (in violation of 33 C.F.R. § 151.25) as well as from the weekly-filed Mineral Management Service activity reports, hereinafter referred to using their form number as the "MMS 133 reports" (in violation of Department of Interior regulations).

Marcy maintains that Defendants fraudulently avoided civil fines and other penalties under several statutes, including the FWPCA and the APPS, the Oil Pollution Act of 1990 ("OPA"), and the Outer Continental Shelf Lands Act ("OCSLA"). Marcy also alleges that these actions occurred in violation of the terms of the oil and gas lease granted to Defendants by the United States pursuant to OCSLA, which requires that Defendants operate in compliance with OCSLA, all other applicable statutes, and "regulations or orders intended to protect persons, property, and the environment on the Outer Continental Shelf." Finally, Marcy alleges that because Defendants breached the lease but continued operations, they fraudulently retained oil and gas, oil and gas royalties, and profits owed to the United States.

Marcy contends that the Defendants' conduct constitutes a violation of the False Claims Act. Marcy refers us to these subsections of the Act:

Any person who . . . (2) knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the Government . . . or (7) knowingly makes, uses, or causes to be made or used a false record or statement

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to conceal, avoid, or decrease an obligation to pay or transmit money or property to the Government . . . is liable to the United States Government for a civil penalty of not less than $5,000 and not more than $10,000, plus 3 times the amount of damages which the Government sustains because of the act of that person.

31 U.S.C. §§ 3729(a)(2) and (a)(7). After investigating Marcy's allegations, the United States filed notice of its election to decline intervention.

Each Defendant filed a motion to dismiss, arguing that Marcy failed to state a claim under the False Claims Act and that he did not allege fraud with sufficient particularity under Federal Rule of Civil Procedure 9(b). The district court granted the motions to dismiss, concluding that Marcy failed to state a claim under the Act. The court declined to address the arguments regarding the particularity of the pleading. After motions for reconsideration and to amend the complaint were denied, Marcy appealed.

DISCUSSION

Marcy asserts that his complaint adequately pled his cause of action. Our review of this issue is de novo, accepting as true the factual allegations that are well-pled and construing them favorably towards the plaintiff. United States ex rel. Willard v. Humana Health Plan of Texas, 336 F.3d 375, 379 (5th Cir. 2003). Those factual allegations must support a claim to relief that is plausible on its face and rises above mere speculation. In re Katrina Canal Breaches Litigation, 495 F.3d 191, 205 (5th Cir. 2007).

Because the two sections of the False Claims Act that Marcy employs have different...

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