U.S. ex rel. Becker v. Westinghouse Savannah

Decision Date27 September 2002
Docket NumberNo. 01-2452.,01-2452.
Citation305 F.3d 284
PartiesUNITED STATES of America, ex rel. Martin BECKER, Plaintiff-Appellant, v. WESTINGHOUSE SAVANNAH RIVER COMPANY, Defendant-Appellee.
CourtU.S. Court of Appeals — Fourth Circuit

ARGUED: John Steven Simmons, Simmons & Griffin, L.L.C., Columbia, South Carolina; Stuart F. Pierson, Troutman Sanders, L.L.P., Washington, D.C., for Appellant. Jeffrey Stuart Patterson, Nelson, Mullins, Riley & Scarborough, L.L.P., Columbia, South Carolina, for Appellee. ON BRIEF: Henry Hammer, Hammer, Hammer, Carrigg & Potterfield, Columbia, South Carolina, for Appellant. Daniel J. Westbrook, Nelson, Mullins, Riley & Scarborough, L.L.P., Columbia, South Carolina, for Appellee.

Before MOTZ and KING, Circuit Judges, and BEEZER, Senior Circuit Judge of the United States Court of Appeals for the Ninth Circuit, sitting by designation.

Affirmed by published opinion. Senior Judge BEEZER wrote the opinion, in which Judge DIANA GRIBBON MOTZ and Judge KING joined.

OPINION

BEEZER, Senior Circuit Judge.

Martin Becker brought this suit under the False Claims Act ("FCA"), 31 U.S.C. § 3729 et seq. Becker alleges that Westinghouse Savannah River Company ("Westinghouse") spent government funds for an unauthorized purpose and created false records to conceal the disbursement. Becker appeals the district court's entry of summary judgment and assigns error to the court's rulings on several procedural motions. We have jurisdiction under 28 U.S.C. § 1291, and we affirm.

I

The Savannah River Plant ("Plant") is a federally-owned nuclear installation in South Carolina owned by the United States. The Department of Energy ("DOE") contracts with Westinghouse for operation and maintenance of the Plant on a cost plus basis. Westinghouse requests funding for Plant projects from DOE. If DOE approves Westinghouse's funding requests, it submits the requests to the President for inclusion in the budget, who then submits the budget to Congress for authorization. See 1 Office of the Gen. Counsel, U.S. Gen. Accounting Office, Principles of Federal Appropriations Law 1-13 to 1-18 (2d ed.1991). If Congress appropriates funds for the specific funding request, DOE "obligates" funds for the specified project and establishes an appropriations account.1 Westinghouse may receive payment charged to an appropriations account only for authorized work and only in amounts equal to Westinghouse's actual costs plus an additional fee. See id. at 2-4.

In Fiscal Years 1992 through 1995, Congress appropriated $55 million for the construction of three buildings at the Plant ("Building Construction").2 DOE obligated just under $54 million and established appropriations accounts specifically for Building Construction managed by DOE's Office of Defense Programs. Westinghouse completed the Building Construction under budget, with a balance of at least $12 million of appropriated funds in the Defense Programs accounts.

In January 1995, DOE underwent management and budget reorganization. Management responsibility for the Westinghouse Defense Programs accounts was transferred to DOE's Office of Environmental Management. Because the Offices of Defense Programs and Environmental Management were funded through separate Congressional appropriations, however, appropriations to Defense Programs accounts could not be transferred to Environmental Management accounts without Congressional approval. See 1 Principles of Federal Appropriations Law, supra, at 2-25 to 2-28. Although DOE apparently requested Congress to authorize transfer of the Defense Programs appropriations to Environmental Management accounts, DOE was unclear whether approval by Congress was actually given.3

Despite this uncertainty, DOE transferred approximately $12 million from the Defense Programs accounts to Environmental Management accounts. DOE directed Westinghouse to change Budgeting and Reporting codes in DOE and Westinghouse's shared accounting system. The new codes would indicate that the $12 million of appropriations constituted a credit balance in the Environmental Management account. Although Westinghouse was aware of the uncertainty within DOE regarding Congressional authority for the appropriations transfer, it acceded to the Department's direction and changed the codes. DOE then relied upon the putative Environmental Management funding authority indicated by the codes to authorize payment to Westinghouse for Plant expenditures unrelated to Building Construction.

Becker filed this suit, averring that Westinghouse had wrongfully retained and used government funds and had created false records to conceal this conduct in violation of §§ 3729(a)(4) and (a)(7) of the FCA.4 The government investigated the allegations in Becker's complaint but declined to intervene, giving Becker the right to conduct the action qui tam. 31 U.S.C. §§ 3730, 3730b.

During the protracted course of discovery, Becker learned that documents divulged by DOE pursuant to Becker's Freedom of Information Act requests had been provided to DOE by Westinghouse. In a letter to the district court outlining the progress of discovery, Becker argued that the fact that Westinghouse originally possessed the documents was relevant to whether Becker's suit was prohibited under the FCA's public disclosure bar. See 31 U.S.C. § 3730(d)(4)(A). Becker requested that the district court order Westinghouse to produce a witness to testify about the exchange of documents between Westinghouse and DOE and the origin of those documents. In an order filed July 11, 2001, the district court denied the request without comment.

On August 7, one week before the close of the scheduled discovery period, Westinghouse moved for summary judgment. The following day, Westinghouse served Becker with the affidavit of John Pescosolido, Chief Financial Officer for DOE's Savannah River Operations. On September 4, more than three months after Westinghouse served Becker with documents and objections responsive to Becker's discovery requests, Becker moved to compel the production of two types of accounting documents mentioned by Pescosolido in his affidavit.

The district court granted Westinghouse's motion for summary judgment and denied as untimely Becker's motion to compel discovery. Becker moved for reconsideration, which the district court denied.

Becker timely appeals the summary judgment in favor of Westinghouse, the denial of Becker's motion to compel discovery, the denial of Becker's request that the court order Westinghouse to produce a witness, and the denial of Becker's motion for reconsideration. We have jurisdiction pursuant to 28 U.S.C. § 1291 and we affirm.

II

We review de novo the district court's summary judgment in favor of Westinghouse. See Hooven-Lewis v. Caldera, 249 F.3d 259, 265 (4th Cir.2001). Summary judgment may be granted only when the record evidence, construed in the light most favorable to the non-movant, shows that "there is no genuine issue as to any material fact." Beale v. Hardy, 769 F.2d 213, 214 (4th Cir.1985). A "genuine issue" exists if a reasonable jury could return a verdict for the non-movant. Owen v. Carpenters' Dist. Council, 161 F.3d 767, 770 (4th Cir.1998). We may affirm summary judgment on any ground supported by the record. Brown v. Trans World Airlines, 127 F.3d 337, 343 (4th Cir.1997).

Section 3729(a)(7) of the FCA imposes civil liability on any person who "knowingly makes, uses, or causes to be made or used, a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the Government." A person acts "knowingly" if he or she knows the record or statement is false or acts in deliberate ignorance of, or with reckless disregard for, the truth or falsity of the record or statement. 31 U.S.C. § 3729(b). Subsection (a)(4) imposes civil liability on any person who "has possession, custody, or control of property or money used, or to be used, by the Government and, intending to defraud the Government or willfully to conceal the property, delivers, or causes to be delivered, less property than the amount for which the person receives a certificate or receipt." Subsection (a)(7) imposes civil liabilities on any person who "knowingly makes, uses, or causes to be made or used, a false record or statement to conceal, avoid, or decrease an obligation to pay or transmit money or property to the Government."

Becker argues that Westinghouse violated § 3729(a)(4) and (a)(7) by acquiescing to DOE's instructions to change the Budgeting and Reporting codes. He contends that Westinghouse changed the Budgeting and Reporting codes while in deliberate ignorance of the existence or lack of Congressional authority for the appropriations transfer or with reckless disregard for whether such authority existed. Becker argues that changing the codes concealed from the government the fact that the appropriations were originally designated for Defense Programs accounts, and that the change enabled Westinghouse to request and receive disbursement from those appropriations for a purpose other than that for which the appropriations were originally authorized.

We find Becker's argument problematic. It is possible to infer from the evidence that, when changing the Budgeting and Reporting codes, Westinghouse at least negligently disregarded whether Congress had approved the appropriations transfer. Yet DOE had at least as much knowledge as Westinghouse regarding Congressional authority for the transfer and nonetheless instructed Westinghouse to change the codes.

Durcholz, decided by the Seventh Circuit, is factually similar to this case. There, a government military facility needed a sedimentation pond to be quickly dredged. United States ex rel. Durcholz v. FKW, Inc., 189 F.3d 542, 543 (7th Cir. 1999). To speed the process, a facility official instructed the contractor to submit invoices for unperformed excavation work instead of invoices for...

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