U.S. ex rel. Burlbaw v. Orenduff

• Citation: 400 F.Supp.2d 1276
• Decision Date: 15 November 2005
• Docket Number: No. CIV 99-1443 BB/LFG.,CIV 99-1443 BB/LFG.
• Parties: UNITED STATES of America, ex rel. Edward J. BURLBAW and ex rel. Donald D. Bustamante, Plaintiffs, v. J. Michael ORENDUFF, et al., Defendants.
• Court: U.S. District Court — District of New Mexico

400 F.Supp.2d 1276

UNITED STATES of America, ex rel. Edward J. BURLBAW and ex rel. Donald D. Bustamante, Plaintiffs, v. J. Michael ORENDUFF, et al., Defendants.

No. CIV 99-1443 BB/LFG.

United States District Court, D. New Mexico.

November 15, 2005.

COPYRIGHT MATERIAL OMITTED

Duff H. Westbrook, Albuquerque, NM, Joleen K. Youngers, Las Cruces, NM, Maureen A. Sanders, Albuquerque, NM, for Relators.

Stephen S. Hamilton, Andrew S. Montgomery, Santa Fe, NM, Kenneth L. Harrigan, Alex C. Walker, Albuquerque, NM, for Defendants.

Howard R. Thomas, Albuquerque, NM, for the United States of America.

OPINION

BLACK, District Judge.

This matter comes before the Court pursuant to several motions filed by the parties: a motion to strike certain defenses or require Defendants to file an "appropriate" answer (Doc. 138); a motion for summary judgment based on qualified immunity (Doc. 157); and motions by each side to strike portions of affidavits filed by the other side in support of each side's summary-judgment submissions (Does. 204, 205). The Court has considered the submissions of the parties and the applicable law and, for the reasons set forth below, will grant the motion for summary judgment. Doing so renders moot the motion to strike certain defenses, and it will be denied. In addition, the motions to strike affidavits are each meritorious in part, and will therefore be granted in part.

As the Court has explained in a previous opinion, United States ex rel. Burlbaw v. Regents of New Mexico State University, 324 F.Supp.2d 1209 (D.N.M.2004), this is a False Claims Act ("FCA") case, in which the relators ("Plaintiffs") contend the individual Defendants made false statements to the federal government in order to obtain various contracts. The relevant facts of the case are adequately summarized in the previous opinion, and the Court will not repeat them here. Since that opinion was issued, the Court has allowed Plaintiffs to conduct limited discovery; following that discovery, the parties filed the motions listed above.

Motions to Strike: Each party objects, on the basis of hearsay, to certain statements made in affidavits filed by the opposing party. Some of these objections have merit. For example, the affidavit of Plaintiff Burlbaw contains several paragraphs relating what he (Burlbaw) was told by various employees of the Physical Sciences Laboratory ("PSL"). Plaintiffs attempt to characterize these statements as admissions of a party-opponent, or alternatively as statements made by agents of the individual Defendants. Neither of these attempts bears scrutiny. The PSL is not a party to this litigation, and the individuals making the statements similarly are not parties. Furthermore, the affidavit does not contain sufficient information to indicate that the individuals making the statements should be considered agents of any of the individual Defendants. The mere fact that these individuals were subordinates of some of the Defendants, or colleagues of the Defendants, is not enough to make them agents of any Defendant, absent evidence that they were directly supervised by a Defendant or were otherwise directly controlled by a Defendant. See United States v. Agne, 214 F.3d 47, 54-55 (1st Cir.2000) (statements of corporate employee may be admitted against corporate officer only under certain circumstances giving rise to agency relationship). Burlbaw's affidavit, however, indicates there was at least one layer of supervision intervening between the individuals making the statements and any Defendant.

Similarly, hearsay problems are present in the affidavit of Defendant Birx, in which he avers that he has "been told on a number of occasions by DOD officials that NMSU qualified as a minority institution ..." These officials are not named and no information is provided that could allow a determination as to whether they were authorized to speak on behalf of the government, or were speaking within the scope of their employment. Such a determination is necessary to determine whether the statements by the "officials" are admissions of a party-opponent and therefore not hearsay. Rule 801(d)(2)(D), F.R.E. To the extent these statements are introduced for the truth of the matter asserted, that New Mexico State University ("NMSU") did qualify as a minority institution, they are not admissible.

In the interest of brevity, the Court will not further review the challenged affidavits. Instead, the Court advises the parties that the portions of the affidavits that are not admissible or, if admissible, are not relevant to the motion for summary judgment, have been ignored. The parties will be able to determine what portions, if any, of the affidavits have been considered by the Court by reviewing the section of this opinion dealing with the merits of the motion for summary judgment.

Motion for Summary Judgment

Availability of Qualified Immunity As a Defense: As noted above, the motion for summary judgment is based on Defendants' claim of qualified immunity. Plaintiffs initially contend that the qualified-immunity doctrine does not apply in FCA cases. In support of this argument, they advance several contentions: (1) the FCA itself contains a provision effectively immunizing certain federal officials from liability, and this provision is the exclusive form of immunity available under the FCA; (2) the only reported case decided under the FCA has rejected the availability of qualified immunity, at least for purposes of the retaliation provision of the FCA; (3) qualified immunity is unavailable under the FCA because the statute does not protect individual rights, unlike other federal statutes; and (4) a claim of good faith immunity is inconsistent with the FCA's scienter requirement, which requires that the individual knowingly submit a false claim. As discussed below, the Court does not accept any of these arguments.¹

The first argument is based on 31 U.S.C. § 3730(e), which states that under certain circumstances, "[n]o court shall have jurisdiction over an action brought" against a member of the armed forces, Congress, or the judiciary, or a senior executive branch official. This provision in effect provides a limited form of absolute immunity to those individuals. Plaintiffs contend that Congress must have intended this to be the only type of immunity available to government officials under the FCA. The Court does not agree that a Congressional intent to preclude application of the doctrine of qualified immunity can be discerned simply from the fact that Congress granted absolute immunity to certain officials under certain circumstances. The practice of granting qualified immunity to state officials performing discretionary functions was well-established in 1986, when Congress amended the FCA and enacted the current version of the "immunity" provision. See, e.g., Harlow v. Fitzgerald, 457 U.S. 800, 807, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982); Scheuer v. Rhodes, 416 U.S. 232, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974); Pub.L. 99-562 (FCA amendments act of 1986). Congress is presumed to be aware of existing law, and is therefore presumed to be aware of government officials' general entitlement to qualified immunity. See In re Griffith, 206 F.3d 1389, 1393 (11th Cir.2000) (courts assume Congress is aware of existing law when it passes legislation). The fact that Congress remained silent concerning qualified immunity, while enacting an extremely limited form of absolute immunity for certain officials, is not an indication that Congress intended to preclude the application of the generally accepted doctrine of qualified immunity to FCA cases. In fact, the courts have indicated that the defense of qualified immunity is so well established that Congress "should specifically say so" if it wishes to abrogate the defense for a particular statute. Tapley v. Collins, 211 F.3d 1210, 1214 (11th Cir.2000) (holding defense of qualified immunity is available under Federal Wiretap Act, despite the fact that statute includes a good-faith defense). Furthermore, the Court's review of the legislative history of the 1986 amendments reveals nothing that would indicate such an intent on the part of Congress. See S. Rep. 99-345, False Claims Amendments Act of 1986, 1986 U.S.C.C.A.N. 5266, 1986 WL 31937. Finally, the Court notes that granting absolute immunity to a few officials under certain circumstances is quite a different matter than addressing the question of qualified immunity for all officials, and the two concepts are in no way mutually exclusive. Cf. Tapley; Gonzalez v. Lee County Hous. Auth., 161 F.3d 1290 (11th Cir.1998) (recognizing qualified immunity defense applies in Wiretap Act cases and in Fair Housing Act cases, even though each statute contains good faith defense).

Plaintiffs next point to the fact that the only reported case concerning the FCA and qualified immunity has rejected the application of the defense, at least in the context of retaliation cases. See Samuel v. Holmes, 138 F.3d 173, 178 (5th Cir.1998). The rationale advanced for that result in Samuel, provided in one short paragraph, is that granting qualified immunity to officials who fire whistle-blowing employees would be at odds with the purposes of the anti-retaliation provision of the FCA. However, this is true of applying qualified immunity to any statute. The protections offered by qualified immunity are only necessary where a statute or the Constitution has been violated; if no violation has occurred there is no need to grant immunity, qualified or otherwise, to an official. See Wilson v. Layne, 526 U.S. 603, 609, 119 S.Ct. 1692, 143 L.Ed.2d 818 (1999) (initial inquiry in qualified-immunity case is whether a constitutional violation has occurred at all); Bella v. Chamberlain, 24 F.3d 1251, 1254 (10th Cir.1994) (same). Therefore, applying qualified immunity and thereby precluding an assessment of liability will always be contrary to the purposes of a statute or the...