Avco Corp. v. U.S. Dept. of Justice

• Citation: 884 F.2d 621
• Decision Date: 08 September 1989
• Docket Number: No. 89-5033,89-5033
• Parties: , 58 USLW 2160, 35 Cont.Cas.Fed. (CCH) 75,715 AVCO CORPORATION, Textron Lycoming Williamsport, et al., Appellants, v. UNITED STATES DEPARTMENT OF JUSTICE, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

Page 621

884 F.2d 621

280 U.S.App.D.C. 182, 58 USLW 2160,

35 Cont.Cas.Fed. (CCH) 75,715

AVCO CORPORATION, Textron Lycoming Williamsport, et al., Appellants, v. UNITED STATES DEPARTMENT OF JUSTICE, Appellee.

No. 89-5033.

United States Court of Appeals District of Columbia Circuit.

Argued May 23, 1989.

Decided Sept. 8, 1989.

Appeal from the United States District Court for the District of Columbia (Misc. 89-00009).

Michael G. Scheininger, with whom Thomas C. Papson and T. Mark Flanagan, Washington, D.C., were on the brief, for appellants.

Robert L. Vogel, Atty., Dept. of Justice, with whom John R. Bolton, Asst. Atty. Gen., Jay B. Stephens, U.S. Atty., and Michael F. Hertz, Atty., Dept. of Justice, Washington, D.C., were on the brief, for appellee.

Before SILBERMAN and SENTELLE, Circuit Judges, and ROBINSON, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge SENTELLE.

SENTELLE, Circuit Judge:

This is an appeal by Dr. Yoon Sam Kim ("Kim" or "appellant"), an employee of Avco Corporation, Textron Lycoming Division ("Avco"), from a final order of the United States District Court for the District of Columbia. That order denied a petition by Kim to set aside a civil investigative demand ("CID" or "demand") filed by the Attorney General under the False Claims Act, 31 U.S.C. Secs. 3729-3733 (1982) ("the Act"), and granted a cross-petition to enforce the demand. Appellant contends that the District Court committed error in its construction of the authorizing statute. Finding no such error, we affirm.

I. BACKGROUND

The False Claims Act is the government's primary litigative tool for the recovery of losses sustained as the result of fraud against the government. See S. REP. No. 345, 99th Cong., 2d Sess. 2 (1986), reprinted in 1986 U.S. CODE CONG. & ADMIN. NEWS 5266. Section 3729 of the Act delineates conduct giving rise to liability under the Act. Such conduct includes knowingly submitting false claims for payment, 31 U.S.C. Sec. 3729(a)(1), and knowingly making or using a false record or statement to get a false claim paid or approved by the government, id. Sec. 3729(a)(2). That section also provides for civil penalties as high as $10,000 plus three times the amount of damages sustained by the government. Id. Sec. 3729(a).

Section 3730 of the Act provides a civil action for the recovery of liabilities under section 3729. Section 3730(a) provides that the Attorney General may bring a civil action against a person violating section 3729. Section 3730(b) provides for "actions by private parties," commonly called "qui tam" proceedings. A 1986 amendment to the Act requires that a qui tam complaint be filed in camera and not be served on the defendant until the court so orders. This same amendment provides that a copy of the complaint "and written disclosure of substantially all material evidence and information the person [filing the case] possesses shall be served on the government." 31 U.S.C. Sec. 3730(b)(2). The complaint is to remain under seal for sixty days, with extensions of that period by order of the court on motion of the government for good cause shown. Id. Sec. 3730(b)(3). Before the expiration of the sixty-day period (or of any extensions obtained under subparagraph (3)), the government must either proceed with the action or notify the court that it declines to so proceed, in which case the original plaintiff has the right to conduct the action. Id. Sec. 3730(b)(4)(A)--(B). Some time shortly before December 7, 1988, a private person brought such a qui tam action against Avco. ¹ That complaint was properly filed in camera and remains under seal at the time of this appeal.

Another section of the Act, section 3733, added in 1986 as part of an extensive revision of the Act, empowers the Attorney General, "before commencing a civil proceeding under section 3730 or other false claims law," to issue a "civil investigative demand." A CID requires a person whom the Attorney General believes to be in possession, custody or control of "documentary material or information relevant to a false claims law investigation" to produce that evidence. After receiving the required copy of the complaint and other information in the qui tam proceeding against Avco, the Attorney General commenced an investigation of the alleged violations of the Act by Avco and served at least four CIDs, including one directed to Kim. That CID demanded that Kim, a metallurgist employed by Avco in its Textron Lycoming Division, produce certain documents concerning the LTS-101 engine manufactured by Avco for use in United States Coast Guard helicopters, and give oral testimony concerning, inter alia, characteristics and performance of that engine and its component parts. Kim filed with the District Court a petition pursuant to section 3733(j)(2), seeking to set aside the CID. Pursuant to order of the District Court, the government disclosed the existence of the qui tam proceeding and filed a cross-petition under section 3733(j)(1), which provides for judicial enforcement of CIDs. ²

Kim argued that the filing of the qui tam proceeding had cut off the power of the Attorney General to issue the instant CID, and that the government was unlawfully conducting civil discovery in the pending action through ex parte investigative demands. The District Court found no merit in that contention, allowed the government's petition for enforcement, and denied Kim's petition to set the demand aside. For the reasons set forth below, we uphold the District Court.

II. ANALYSIS

The resolution of the question presented by Kim's objection to the Attorney General's use of his power to issue CIDs depends on the construction of section 3733(a)(1) of the Act. That section provides that "whenever the Attorney General has reason to believe that any person may be in possession, custody, or control of any documentary material or information relevant to a false claims law investigation, the Attorney General may, before commencing a civil proceeding under section 3730 or other false claims law, issue in writing and cause to be served upon such a person, a civil investigative demand...." Id. 31 U.S.C. Sec. 3733(a)(1). Both parties concede--and it is evident to anyone reading the statute--that the Attorney General may not employ the power granted by this section after he has commenced a false claims action. Kim contends that the Attorney General is likewise precluded from issuing CIDs when someone else, i.e., a qui tam relator, has initiated such a proceeding.

Nothing in the words of the enactment compels the result Kim proposes. In common English usage, a participial phrase such as "before commencing a civil action" refers to the subject of the sentence, in this case "the Attorney General." See W. STRUNK AND E. WHITE, The Elements of Style 13-14 (3d ed. 1979). Therefore, the plain meaning of the section is "the Attorney General may, before the Attorney General commences a civil proceeding under section 3730 ... issue a civil investigative demand."

This would seem to answer the question before us: "Where the language of a statute is clear in its application, the normal rule is that we are bound by it." Public Citizen v. United States Dep't of Justice, --- U.S. ----, ----, 109 S.Ct. 2558, 2574, 105 L.Ed.2d 377 (1989) (Kennedy, J., concurring). Appellant would have us look to the legislative history of the 1986 amendments to the Act and conclude that the statute in fact means "the Attorney General may, before anyone commences a civil proceeding under 3730 ... issue a [CID]." As we recently observed in a different context, "it is only waggishly stated that 'where the statutory history is ambiguous, we will look to the words of the statute,'...." Antolok v. United States, 873 F.2d 369, 377 (D.C.Cir.1989). In Antolok we found that we would have reached the same result even if that were the rule because the legislative history and the statute in that case were consistent. In the present case, appellant seeks by ambiguous legislative history to override the most natural reading of the statute.

Insofar as any ambiguity exists in the present statute it focuses on the meaning of the word "commences." Appellant makes the very plausible argument that in the case of a qui tam proceeding the Attorney General never "commences" a civil proceeding because the relator has already commenced the proceeding before the Attorney General is even aware of it. As appellant notes, if the language is taken with absolute literalness on this point, then the Attorney General could intervene in the litigation but continue to use the CID as an extraordinary and ex parte means of obtaining discovery. This would indeed be an unusual result. There is certainly authority that "where the plain language of the statute would lead to 'blatantly absurd consequences,' ... that 'Congress could not possibly have intended,' ... we need not apply the language in such a fashion." Public Citizen, --- U.S. ---- at ----, 109 S.Ct. 2558 at 2574 (Kennedy, J., concurring) (emphasis in original) (citations omitted). However, in the present case we need not determine whether that result would be sufficiently "absurd" for us to determine that "Congress could not possibly have intended" it. In the present case, the Attorney General has not used the CID power after intervention; indeed, he has not intervened. The Department of Justice concedes that the word "commencing" should be construed illiterally to encompass "intervening." If some future Attorney General should disagree with this interpretation and attempt to issue a CID after intervening in and taking control of a qui tam proceeding under section 3730(b)(4)(A), it is not unlikely that we would reject that new interpretation, but we need not decide that hypothetical.

Once that semantic Rubicon is crossed, that is including "intervening" within the scope of "commencing," the argument based on legislative history becomes quite unconvincing. That...