United States v. Rainwater, 15659
Decision Date | 17 June 1957 |
Docket Number | No. 15659,15660.,15659 |
Citation | 244 F.2d 27 |
Parties | UNITED STATES of America, Appellant, v. R. S. RAINWATER, Sr., Sloan Rainwater, Jr., William Rainwater, as individuals and as partners, d/b/a R. S. Rainwater & Sons, Appellees. UNITED STATES of America, Appellant, v. CITIZENS NATIONAL BANK, Walnut Ridge, Arkansas, Appellee. |
Court | U.S. Court of Appeals — Eighth Circuit |
Marcus A. Rowden, Atty., Dept. of Justice, Washington, D. C. (George Cochran Doub, Asst. Atty. Gen., Osro Cobb, U. S. Atty., Little Rock, Ark., and Samuel D. Slade, Atty., Dept. of Justice, Washington, D. C., were with him on the brief), for appellant.
Catlett & Henderson, Little Rock, Ark., filed brief for appellees.
Before WOODROUGH, VOGEL and VAN OOSTERHOUT, Circuit Judges.
The United States brought two separate actions under the Federal False Claims Act, §§ 3490-3492 and § 5438 of the Revised Statutes, 31 U.S.C.A. §§ 231-233. Both actions were based on alleged false representations made to the Commodity Credit Corporation for the purpose of obtaining loans on cotton. The cases were consolidated and will be treated jointly. Subsequent to the consolidation the defendants made motions to dismiss on two grounds: 1, Lack of jurisdiction of the subject matter; 2, failure to state a claim upon which relief could be granted. Without writing an opinion setting forth its reasons, the District Court granted dismissal and the government brings these appeals.
The briefs and arguments of counsel are confined to two propositions: One, do false claims submitted to wholly owned government corporations, such as Commodity Credit Corporation, come within the purview of the False Claims Act as claims "against the Government of the United States, or any department or officer thereof"? Two, do the complaints state facts upon which relief may be granted where there has been no specific allegation of damage?
The second question requires no prolonged discussion. The complaints, after setting forth in detail the manner in which the defendants procured the "payment and allowance of false and fraudulent claims", (loans on cotton) pray for judgment "for the amounts provided for in 31 U.S.C. 231". 31 U.S.C.A. § 231, being the False Claims Act under which the actions were commenced, provides that the persons doing any of the prohibited acts "shall forfeit and pay to the United States the sum of two thousand dollars, and, in addition, double the amount of damages". Accordingly, it cannot be said, as claimed by the defendants, that there was no allegation of damage. Certainly by inference, at least, the government asks that in addition to the sum of $2,000.00 it recover double the amount of its damages. Irrespective of that, we believe that even if no damages were shown at the time of trial the United States could still recover the statutorily fixed sum of $2,000.00 for each of the proscribed acts. United States v. Rohleder, 3 Cir., 1946, 157 F.2d 126, 129; United States ex rel. Marcus v. Hess, D.C.Pa., 1941, 41 F.Supp. 197, affirmed 317 U.S. 537, 63 S.Ct. 379, 87 L.Ed. 443. We hold that defendants' second point of contention is unsound.
It is with the first proposition that difficulty arises. The False Claims Act, § 3490 of the Revised Statutes, was passed in 1863:
The foregoing § 3490 has never been amended, but R.S. § 5438, the criminal section referred to therein, has been amended. Prior to the amendment of R.S. § 5438 it, insofar as may be pertinent herein, was as follows:
(Emphasis supplied.)
While § 5438 was subsequently amended to include "any corporation in which the United States of America is a stockholder", it is well established that subsequent alteration or repeal of a statute previously incorporated by reference in a second statute does not affect the incorporating statute. United States ex rel. Kessler v. Mercur Corp., 2 Cir., 1938, 83 F.2d 178, 180:
Succinctly stated, then, our question is: Do false claims submitted to the Commodity Credit Corporation, a wholly owned government corporation, come within the meaning of the Federal False Claims Act as being "upon or against the Government of the United States, or any department or officer thereof"?
In a very recent case, United States v. McNinch, 242 F.2d 359, 362, the Court of Appeals for the Fourth Circuit held that a claim against a government corporation which acts as an agency of the government is not a claim against the government of the United States or a department or officer thereof, "* * * as required by R.S. § 5438 as a condition of liability at the time of the adoption of R.S. § 3490". It held that the language of the statute was not broad enough to cover such claims. The court gave consideration to the fact that the language of R.S. § 3490 was not amended when amendments were made in the language of R.S. § 5438 (the criminal statute) to cover the making of false claims against corporations in which the government was a stockholder. It stated, 242 F.2d at page 364:
We find ourselves in disagreement with the Fourth Circuit case and must decline to follow it. Until United States v. McNinch, no case had so held. United States ex rel. Salzman v. Salant & Salant, Inc., D.C.N.Y., 1938, 41 F.Supp. 196, cited by the appellees is not in point as it involves the Red Cross, whose funds are in no sense the property of the United States. In addition to the cases reversed by McNinch, the District Court for the Southern District of New York, in United States v. Samuel Dunkel & Co., Inc., D.C.N.Y., 1945, 61 F.Supp. 697, 699, in dealing with alleged frauds in connection with the sale of dried eggs to the Federal Surplus Commodities Corporation, held:
We rely mainly, however, upon United States ex rel. Marcus v. Hess, 1943, 317 U.S. 537, 63 S.Ct. 379, 87 L.Ed. 443, (cited in the Samuel Dunkel case). In doing so, we shall attempt to point out that the ultimate source of payment of the fraudulent claims was the federal treasury and when so viewed there can be no distinction between a government corporation or the government itself being defrauded. In Marcus v. Hess, supra, the Supreme Court was dealing with the same Acts with which we are here concerned. There the respondents had made claims with local governmental units rather than with the United States government, but a substantial portion of their pay came from the United States for work on PWA projects. The court stated, 317 U.S. at page 542, 63 S.Ct. at page 383:
...
To continue reading
Request your trial-
Monarch Life Ins. Co. v. Loyal Protective Life Ins. Co.
...incorporating statute (Rev.Stat. § 3490) was to be read as if Rev.Stat. § 5438 was not amended or repealed. See also, United States v. Rainwater, 244 F.2d 27 (8 Cir. 1957), aff'd 356 U.S. 590, 78 S.Ct. 946, 2 L.Ed.2d 996 (1958); United States v. McNinch, 242 F.2d 359 (4 Cir.), modified, 356......
-
United States v. Winchester
.... . . without actual damage being proven." United States v. Rohleder, 157 F.2d 126, 129 (3d Cir. 1946). See United States v. Rainwater, 244 F.2d 27, 28 (8th Cir. 1957), aff'd, 356 U.S. 590, 78 S.Ct. 946, 2 L.Ed.2d 996 (1958). See generally Rex Trailer Co. v. United States, 350 U.S. 148, 153......
-
Longmire v. Sea Drilling Corp.
...Heath, 144 U.S. 92, 12 S.Ct. 615, 36 L.Ed. 358 (1892); Kendall v. United States, 12 Pet. 524, 9 L. Ed. 1181 (1838); United States v. Rainwater, 244 F.2d 27 (8th Cir. 1957), Aff'd, 356 U.S. 590, 78 S.Ct. 946, 2 L.Ed.2d 996 (1958); Kessler v. Mercur Corp., 83 F.2d 178 (2d Cir.), Cert. denied,......
-
Wille, In re
...agricultural commodities. Rainwater v. United States, 356 U.S. 590, 591--592, 78 S.Ct. 946, 2 L.Ed.2d 996, see also opinion below, 244 F.2d 27, 30--31 (8 Cir.), where the Court 'The Commodity Credit Corporation is actually an instrumentality of the United States 'within the Department of Ag......