Webster v. United States ( 2000 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
DIANE WEBSTER,
Movant-Appellant,
v.
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v.
DAVID S. BOWMAN; BOWMAN
No. 99-1485
ENTERPRISES, INCORPORATED; PEARL
M. BOWMAN; ALISON BOWMAN
WATERS; DAVID S. BOWMAN, JR.;
KIMBERLY KING BOWMAN; JENNIFER
BOWMAN; DONNA BOWMAN DUNN;
ROBERT M. WATERS; ALICE FAYE
BLIZZARD,
Defendants.
Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Albert V. Bryan, Jr., Senior District Judge.
(CA-98-1248-A)
Argued: April 7, 2000
Decided: July 12, 2000
Before WILLIAMS, MICHAEL, and KING, Circuit Judges.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
_________________________________________________________________
COUNSEL
ARGUED: Candace Smith McCall, CANDACE MCCALL, P.C.,
Fairfax, Virginia, for Appellant. Lowell Vernon Sturgill, Jr., Appel-
late Staff, Civil Division, UNITED STATES DEPARTMENT OF
JUSTICE, Washington, D.C., for Appellee. ON BRIEF: David W.
Ogden, Acting Assistant Attorney General, Helen F. Fahey, United
States Attorney, Douglas N. Letter, Appellate Staff, Civil Division,
UNITED STATES DEPARTMENT OF JUSTICE, Washington,
D.C., for Appellee.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
Diane Webster seeks to intervene in a False Claims Act (FCA) suit
brought by the government. Because the FCA prohibits intervention
by private parties, we affirm the district court's denial of Webster's
motion to intervene.
I
Webster worked for the Drug Enforcement Agency in its Finance,
Policy and Review Unit, where she performed various accounting
tasks. Around December 1996, in the course of a routine audit, Web-
ster discovered a number of suspicious invoices and vouchers submit-
ted by Finance Liaison Group (FLG). All of these expenditures had
been approved by David Bowman, a DEA account manager. Webster
reported Bowman and the suspicious invoices to her superiors, ulti-
mately exposing a fraudulent scheme in which Bowman allegedly
obtained over $6,000,000.
On December 10, 1997, Webster filed a qui tam suit under the FCA
against Bowman, FLG, and thirteen John Doe defendants. Webster's
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complaint alleged that FLG had fraudulently obtained money from
the DEA by submitting false invoices and vouchers requesting pay-
ment for work that had not been performed. The complaint further
alleged that Bowman had knowingly approved payment of the false
claims.
The government declined to intervene in that action. In May 1998
Webster, with the government's consent, voluntarily dismissed her
qui tam action without prejudice. See 31 U.S.C. § 3730(b) (false
claim action brought by private person "may be dismissed only if the
court and the Attorney General give written consent to the dismissal
and their reasons for consenting"). By that time, criminal charges and
a civil forfeiture proceeding were pending against Bowman. Webster
alleges that it looked as though there would be nothing left to recover
in her qui tam suit once those other actions concluded, but that the
"parties wanted to preserve the right to bring this action again should
circumstances change." Webster Br. at 6.
Three months later on August 26, 1998, the United States filed its
own civil action against FLG, Bowman, and a number of Bowman's
family members, alleging false claims, conspiracy to defraud the gov-
ernment, and several additional common law causes of action. The
government did not inform Webster of its intent to file the suit. Once
she learned of the government's action, however, Webster filed a
motion to intervene under Fed. R. Civ. P. 24. That motion was denied
by the district court, and Webster appealed.
II
The FCA establishes civil penalties for knowingly submitting a
false claim to the federal government. See 31 U.S.C. § 3729. The Act
also permits private persons to sue on the government's behalf and
recover for violations of section 3729. See id. § 3730(b); United
States ex rel. LaCorte v. Wagner, 185 F.3d 188, 190 (4th Cir. 1999).
If the action is successful, the private plaintiff is entitled to a portion
of the damages and penalties recovered. See id. § 3730(d); LaCorte,
185 F.3d at 190. The government may intervene in an action filed by
a private person, see 31 U.S.C. § 3730(b)(2), but once any FCA claim
has been filed, "no person other than the Government may intervene
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or bring a related action based on the facts underlying the pending
action." Id. § 3730(b)(5).
Notwithstanding this unambiguous language, Webster argues that
she is entitled to intervene in the government's FCA suit against
Bowman. Webster first contends that section 3730(b)(5) prohibits pri-
vate persons from intervening in FCA suits brought by other private
persons, but does not prohibit intervention in a suit brought by the
government. We are not persuaded. As we have recently held, the
"statute plainly and absolutely prohibits intervention by private par-
ties." LaCorte, 185 F.3d at 190. Webster's constricted interpretation
of section 3730(b)(5) would read out of the statute any bar to private
party intervention in a government false claims suit. That result
clearly would be inconsistent with the congressional goal of striking
a balance "between encouraging citizens to report fraud and stifling
opportunistic lawsuits." Id. at 191-92. See id. ("The only way to pre-
serve the balance that Congress struck is to apply the unqualified con-
gressional mandate of section 3730(b)(5) to bar all would-be
intervenors other than the government.").
Webster next argues that section 3730(b)(5) should not prevent her
from intervening in the government's suit against Bowman because
she is "in essence intervening upon her own original complaint, and
is not adding a suit." Webster Br. at 12. Webster appears to argue that
her voluntarily dismissed suit and the government's subsequently
filed suit here are in fact the same action and that the government has
simply "revived" her complaint by suing on the same facts. See Web-
ster Br. at 12, 18. Consequently, Webster argues, she does not seek
to intervene in a "related action" but rather seeks to resume participa-
tion in her own action. We disagree. Webster's assertion that her vol-
untarily dismissed complaint confers on her a continuing right to
participate in the government's subsequently filed FCA suit is simply
wrong. See Sandstrom v. ChemLawn Corp., 904 F.2d 83, 86 (1st Cir.
1990) (holding that voluntary dismissal "wipes the slate clean, mak-
ing any future lawsuit based on the same claim an entirely new law-
suit unrelated to the earlier (dismissed) action"); 9 Charles Alan
Wright & Arthur R. Miller, Federal Practice and Procedure § 2367
(2d ed. 1995) ("A voluntary dismissal without prejudice leaves the sit-
uation as if the action never had been filed."); 8 James W. Moore,
Moore's Federal Practice § 41.40[9][b] (3d ed. 1999) ("A voluntary
4
dismissal under Rule 41(a)(2) renders the proceedings a nullity and
leaves the parties as if the action had never been brought.").
Finally, Webster argues that section 3730(c)(5) allows her to inter-
vene in the government's case. That provision allows the government
"to pursue its claim through any alternate remedy available to the
Government, including any administrative proceeding to determine a
civil money penalty." If the government elects an alternate remedy,
"the person initiating the action shall have the same rights in such
proceeding as such person would have had if the action had continued
under this section." 31 U.S.C. § 3730(c)(5). Webster maintains that
the government's FCA suit is an alternate remedy and that she should
have the same rights in that suit that she would have had in her own,
had she not dismissed it. Again, we disagree. Section 3730(c)(5)
"does not confer any rights on would-be intervenors." LaCorte, 185
F.3d at 191. Rather, it "simply preserves the rights of the original qui
tam plaintiffs when the government resorts to an alternate remedy in
place of the original action." Id. Webster cannot assert the rights of
an original qui tam plaintiff, however, because she abandoned those
rights when she voluntarily dismissed her suit against Bowman.
Requiring a qui tam plaintiff to make some effort to prosecute her
suit in order to participate in any ultimate recovery results in neither
unfairness nor the frustration of congressional policy. By barring pri-
vate persons from intervening in pending FCA actions or from bring-
ing related suits, section 3730(b) creates a race to the courthouse: the
winner of that race is the only person allowed to participate in the
government's recovery, thus providing incentive to promptly report
fraud. Once the race is won, however, the winner is not free simply
to claim the prize and go home. As we and numerous other courts
have observed, "[t]he history of the FCA qui tam provisions demon-
strates repeated congressional efforts to walk a fine line between
encouraging whistle-blowing and discouraging opportunistic behav-
ior." United States ex rel. Springfield Terminal Ry. v. Quinn, 14 F.3d
645, 651 (D.C. Cir. 1994). See also LaCorte, 185 F.3d at 191-92;
United States ex rel. LaCorte v. SmithKline Beecham Clinical Labo-
ratories, Inc., 149 F.3d 227, 233-34 (3d Cir. 1998). As the govern-
ment points out, Webster's reading of the statute would allow a
private party to file a qui tam false claims suit with no intention of
pursuing it, dismiss the suit without prejudice, and then, when the
5
government chose to investigate and prosecute its own claim, clamber
back on board. The careful balance struck by Congress would be
thrown awry if individuals could stockpile potential qui tam claims
while waiting for more diligent plaintiffs to bring the case in earnest.
III
For the reasons given above, we affirm the district court's order
denying Webster's motion to intervene.*
AFFIRMED
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*The government's motion for leave to file supplemental appendix
materials is granted.
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