U.S. ex rel. Garibaldi v. Orleans Par. School Bd., CIV. A. 96-0464.

• Citation: 46 F.Supp.2d 546
• Decision Date: 27 April 1999
• Docket Number: No. CIV. A. 96-0464.,CIV. A. 96-0464.
• Parties: UNITED STATES of America ex. rel. William GARIBALDI and Carlos Samuel v. ORLEANS PARISH SCHOOL BOARD.
• Court: United States District Courts. 5th Circuit. United States District Court (Eastern District of Louisiana)

46 F.Supp.2d 546

UNITED STATES of America ex. rel. William GARIBALDI and Carlos Samuel v. ORLEANS PARISH SCHOOL BOARD.

No. CIV. A. 96-0464.

United States District Court, E.D. Louisiana.

April 27, 1999.

As Amended June 4, 1999.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

William Wessel, Raymond Robert Egan, III, Wessel & Associates, New Orleans, LA, for Plaintiffs.

Sam A. Leblanc, III, Edward Michael Morris, James G. Perdiago, Kenneth F. Tamplain, Jr., Adams & Reese, New Orleans, LA, for Defendant.

ORDER AND REASONS

DUVAL, District Judge.

This qui tam action was filed by William Garibaldi and Carlos Samuel ("the relators") on behalf of the United States of America ("plaintiff") against the Orleans Parish School Board ("OPSB"). The case came before the court on a trial by jury, and the jury found in favor of the relators and the United States (collectively, "plaintiffs"). Accordingly, the court entered judgment for the plaintiffs in the amount of approximately $31,000,000.

Before the court are several motions, including: (1) a Motion for Judgment as a Matter of Law, or, Alternatively, a New Trial, filed by defendant Orleans Parish School Board (Doc. # 192), (2) a Motion to Dismiss Plaintiff's Complaint for Lack of Subject Matter Jurisdiction, filed by defendant, OPSB (Doc. # 235); (3) a Motion to Alter or Amend the Judgment, filed by plaintiff, United States of America (Doc. # 191); (4) a Motion to Alter or Amend the Judgment, filed by the relators, William Garibaldi and Carlos Samuel (Doc. # 185); (5) Objections to Order Granting Motion for Extension of Time and Report and Recommendation, filed by defendant, OPSB (Doc. # 231); and (6) Objections to Proposed Findings, Conclusions, and Recommendation of Magistrate, filed by the relators (Doc. # 230). The court will address each motion in turn.

I. DEFENDANT ORLEANS PARISH SCHOOL BOARD'S MOTION FOR JUDGMENT AS A MATTER OF LAW, OR ALTERNATIVELY, A NEW TRIAL

A. APPLICABLE LEGAL STANDARDS

1. STANDARD FOR JUDGMENT AS A MATTER OF LAW

Under Rule 50 of the Federal Rules of Civil Procedure, the court must determine whether there is sufficient evidence to support the jury's verdict and in so doing all evidentiary issues are to be resolved in favor of the successful party and that party is to be given the benefit of all reasonable inferences.

As stated in the seminal case Boeing Co. v. Shipman, 411 F.2d 365, 374-75 (5th Cir.1969), in considering a motion for judgment as a matter of law, the court should consider all of the evidence—not just that evidence which supports the non-mover's case—but in the light and with all reasonable inferences most favorable to the party opposed to the motion. If the facts and inferences point so strongly and overwhelmingly in favor of one party that the Court believes that reasonable persons could not arrive at a contrary verdict, granting of the motion is proper. On the other hand, if there is substantial evidence opposed to the motions, that is, evidence of such quality and weight that reasonable and fair-minded persons in exercise of impartial judgment might reach different conclusions, the motion should be denied. See Branch v. Chevron Int'l Oil Co., 681 F.2d 426, 428-29 (5th Cir.1982).

2. STANDARD FOR MOTION FOR NEW TRIAL

The standard provided under Rule 59 of the Federal Rules of Civil Procedure to determine whether a new trial or remittitur is required is different from that of Rule 50. The rule does not specify what grounds are necessary to support such a decision; however, case law demonstrates that a new trial may be granted if the district court finds that the verdict is against the great weight of the evidence, the damages awarded are excessive, the trial was unfair, or prejudicial error was committed in its course. Smith v. Transworld Drilling, 773 F.2d 610, 613 (5th Cir.1985). In making its determination, the lodestar is whether the verdict is against the great weight of the evidence or would result in the miscarriage of justice. Unlike a Rule 50 motion, there is no need to view the evidence in the light most favorable to the nonmoving party. Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure, § 2806 (2d. ed.1995).

B. NO NEW EVIDENCE WAS PRESENTED AT TRIAL THAT WOULD MOVE THIS COURT TO RECONSIDER ITS RULING ON THE ISSUES RAISED BY DEFENDANT'S MOTION FOR SUMMARY JUDGMENT

On September 22, 1998, this court issued a ruling denying the defendant's Motion for Summary Judgment.¹ Of its many findings, the following are relevant to the arguments raised by OPSB in its post-trial motions:

• The court has subject matter jurisdiction over this qui tam action, because the information on which the action is based was not publicly disclosed prior to the relator's disclosure of it;

• Even if the information were publicly disclosed, the court still has subject matter jurisdiction over the claim, because the relators were the original source of the information;

• The relators plead the necessary elements, including scienter, to show fraud under the FCA; and

• The relators need not have actually filed their qui tam action before being terminated or suspended from their jobs in order to bring a retaliation claim under section 3730(h).

OPSB has reiterated the arguments it made in its Motion for Summary Judgment in its post-trial motions, and the court remains unpersuaded.² Having heard the evidence at trial, the court finds that it need not revisit the legal conclusions of its September 1998 Order and Reasons. The rest of OPSB's argument on these subjects is essentially an attempt to try its case before the judge instead of before the jury. The jury, and not the judge, is responsible for finding the facts in this case. This court finds that a reasonable jury could conclude that OPSB acted with fraudulent intent as defined by the FCA.

C. THE COURT DID NOT ABUSE ITS DISCRETION IN MAKING ITS EVIDENTIARY RULINGS

1. THE COURT PROPERLY ADMITTED DEFENDANT'S JUDICIAL ADMISSION AS TO THE NUMBER OF CLAIMS

Early on in this case, plaintiffs asked defendant, through a written interrogatory, to "state the total number of claims submitted to any federal or state agency for the special revenue fund and child nutrition fund for unemployment compensation and workers compensation for each quarter from January 1, 1986 through June 30, 1997 for the purpose of obtaining reimbursement."

In his answer to the interrogatory, Anthony Stolz, the OPSB Comptroller and the party representative at trial, provided computer print-outs of revenue postings for the time period requested, and answered that the "number of claims is equal to the number of posting designated with a `Rev.' code." The plaintiffs used this information to create an exhibit that listed the number of receipts of federal funds for each year. Plaintiff's Exhibit 62. There were 1570 revenue postings in the exhibit. Mr. Stolz testified that he drew up this answer with his attorney. Defendant apparently later realized that, because the FCA penalizes each individual claim, the actual number of claims matters almost as much as the total monetary amount of those claims. At trial, defendant tried to exclude its prior interrogatory answer, and plaintiff moved for the court to consider the response a judicial admission. The court held that the response was a judicial admission under White v. ARCO/Polymers, Inc., 720 F.2d 1391 (5th Cir.1983) (factual assertions in pleadings and pre-trial orders are considered to be judicial admissions conclusively binding on the party who made them), citing Myers v. Manchester Insurance & Indemnity Co., 572 F.2d 134 (5th Cir.1978). OPSB argues that this holding was an abuse of discretion, because the claims to which it admitted were not claims under the definition of "claim" in the False Claims Act. The court disagrees.

Only deliberate, clear, and unequivocal statements can be judicial admissions. Matter of Corland Corp., 967 F.2d 1069, 1074 (5th Cir.1992), (citing Backar v. Western States Producing Co., 547 F.2d 876, 880 n. 4 (5th Cir.1977)). OPSB cites Backar for the principle that if the person making the admission is unaware that he is admitting liability, the admission is not a "judicial admission," and argues that, here, Stolz was unaware that he was admitting liability. The court finds Backar inapplicable. Stolz's admission was not the uninformed statement of a low-level employee. As the Controller of OPSB, Stolz drafted the admission with the help of his attorney. Furthermore, the statement does not admit liability: Stolz did not state that OPSB made 1570 "false claims," just that it made 1570 "claims" for worker's compensation and unemployment compensation costs. If the court were to allow the defendant to equivocate on its answers to interrogatories, the doctrine of judicial admissions would lose its meaning and effectiveness.

Defendants further argue that the response of Mr. Stolz could not be properly considered by the jury, as the substance of the response contradicts the definition of "claim" in the statute and in the federal regulations. The False Claims Act defines the term "claim" as follows:

For the purpose of this section, a "claim" includes any request or demand, whether under a contract or otherwise, for money or property which is made to a contractor, grantee, or other recipient if the United States Government provides any portion of the money or property which is requested or demanded, or if the Government will reimburse such contractor, grantee, or other recipient for any portion of the money or property which is requested or demanded. § 31 U.S.C. § 3729(c).

In other words, the School Board made a "claim" every time it requested money from the government. It is the number of applications for funds, and not the number of coded items on each application, or the number of invoices generated by the applications, or the number of contracts the applications...