Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca7-15-01004/USCOURTS-ca7-15-01004-0/pdf.json

Nature of Suit Code: 375
Nature of Suit: False Claims Act
Cause of Action: 

---

In the 

United States Court of Appeals 

For the Seventh Circuit ____________________

No. 15‐1004

UNITED STATES OF AMERICA ex rel. SHEET METAL WORKERS

INTERNATIONAL ASSOCIATION, LOCAL UNION 20,

Plaintiff‐Appellant,

v.

HORNING INVESTMENTS, LLC,

Defendant‐Appellee.

____________________

Appeal from the United States District Court for the

Southern District of Indiana, Indianapolis Division.

No. 12‐cv‐00830 — Jane E. Magnus‐Stinson, Judge.

____________________

ARGUED NOVEMBER 6, 2015 — DECIDED JULY 7, 2016

____________________

Before WOOD, Chief Judge, and POSNER and EASTERBROOK,

Circuit Judges.

WOOD, Chief Judge. Horning Investments, LLC, is a roofing

company, but this case is about a floor—in particular, the

lower limit on wages and benefits imposed by the federal Da‐

vis‐Bacon Act. The dispute concerns a construction project for

the U.S. Department of Veterans Affairs. Horning was a sub‐

contractor for the project; its workers are represented by Local

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
2 No. 15‐1004

20 of the Sheet Metal Workers International Association (the

Union). Believing that Horning had paid its workers less than

the Davis‐Bacon Act requires, the Union sued. Interestingly,

however, it did not pursue relief directly under Davis‐Bacon;

instead, it filed a qui tam action under the False Claims Act, 31

U.S.C. §§ 3729–3733—the statute at issue in the Supreme

Court’s recent decision in Universal Health Servs., Inc. v. United

States ex rel. Escobar, 136 S. Ct. 1989 (2016).  

By choosing the False Claims route, the Union undertook

to show that Horning knowingly made false statements (or

misleading omissions of the type described in Universal Health

Services) that were material to the government’s payment de‐

cision. We conclude that the Union did not proffer enough ev‐

idence to permit a reasonable jury to conclude that Horning

acted with the requisite knowledge. We thus affirm the judg‐

ment of the district court in Horning’s favor.

I

Horning Investments does business as Horning Roofing &

Sheet Metal, LLC; we refer to both entities as Horning. In May

2011, a company called Construct Solutions won the contract

to perform work at the Veterans Affairs Medical Center in

Dayton, Ohio. Construct Solutions awarded Horning the sub‐

contract to provide roofing for the Medical Center. As all con‐

cede, the Davis‐Bacon Act, 40 U.S.C. §§ 3141–43, applied to

this project.  

That Act requires contractors who perform construction

projects for the federal government to pay their workers the

“prevailing wage.” Id. § 3142(a). Regulations issued by the De‐

partment of Labor define that term by region; the definition

outlines base wage rates and fringe benefits for each type of

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
No. 15‐1004 3

worker. Id. § 3142(b). The parties have stipulated that in Day‐

ton, Ohio, at the time the Medical Center was being built, the

base rate for a worker classified as a Sheet Metal Worker was

$26.41 per hour, and the additional fringe benefit rate was an‐

other $16.82 an hour. The parties also agree that the workers

were classified in the proper category and that they were paid

the appropriate base rate. This case is about their fringe ben‐

efits.

Horning provides certain fringe benefits to all of its em‐

ployees, both those who work on projects covered by Davis‐

Bacon and those who work on other projects. For example,

employees who have worked at Horning for more than 90

days are eligible for life, dental, vision, and health insurance;

some also receive vacation days. After a year, they become el‐

igible for matching contributions to a 401(k) account. In Octo‐

ber 2010, Horning created a Trust for its employee insurance

benefits. (It already had a separate fund for the 401(k) ac‐

counts.) Robin Moore, who handled Horning’s human re‐

sources portfolio, testified that she relied on advice from

Horning’s accountants to determine how much to deduct

from paychecks and how to allocate those funds between the

401(k) account and the new Trust. The accountants advised

Horning about how much it needed to deposit into the Trust

in order to comply with applicable law, including both the

Employment Retirement Income Security Act of 1974 (which

is not at issue here) and the Davis‐Bacon Act.  

Horning ran into trouble when it decided to deduct a flat

hourly fee, to be paid into the Trust, from the paycheck of each

employee working on the Medical Center project. Moore tes‐

tified that, based on a “rounded figure” she received from the

accountants, she deducted $5.00 per hour from those

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paychecks and deposited those funds into the Trust. That

amount was deducted regardless of whether the employee

was eligible for any benefits at all (for instance, without dif‐

ferentiating between those employed for more than 90 days

and new hires). Furthermore, the $5.00 did not correspond to

the actual monetary value of the benefits each individual em‐

ployee received. It is this arrangement, according to the Un‐

ion, that violates Davis‐Bacon.1

In order fully to understand the Union’s theory, we must

delve into the details of Horning’s system for paying benefits.

First, Moore calculated the paycheck deduction for each em‐

ployee. Then Leanne Torres, the person directly responsible

for payroll, passed along information about each employee’s

paycheck, including total amount, deductions, and contribu‐

tions to the Trust and the 401(k) account, to Horning’s external

payroll processor, Paychex. Paychex deposited money into

the appropriate accounts and generated a form, known as the

Certified Payroll Report (or Register), memorializing the pay‐

ments. Torres reviewed the Certified Payroll Report and sub‐

mitted it to Construct Solutions, which in turn submitted the

Report to the government for payment.

Initially, the Certified Payroll Report listed the higher, total

amount, before deductions for payments to the Trust and the

401(k) account were made, as the “wage” paid to each em‐

ployee. It incorrectly indicated that amounts paid into the

Trust and the 401(k) accounts were in addition to the listed

                                                  1  The record does not indicate where, exactly, the $5.00/hour number

came from, but both parties say that it was deducted from the fringe rate

and that the rest of the fringe rate went into the employee’s 401(k) account.

The Union has made nothing of this loose end, and so neither will we.

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
No. 15‐1004 5

number rather than included within it. Torres eventually cor‐

rected the Certified Payroll Reports. The Union contends,

however, that this was not enough, because its employees

were still not receiving the proper Davis‐Bacon pay rates.

Each Certified Payroll Report included a statement attesting

that it was accurate, that no further deductions were taken,

and that fringe benefits were properly paid.

In addition to the Certified Payroll Reports that it submit‐

ted to the government, Horning also prepared eight specific

applications for payment and sent them to Construct Solu‐

tions. Construct Solutions later forwarded these to the gov‐

ernment. Like the Certified Payroll Reports, the applications

included a statement attesting that Horning was paying Da‐

vis‐Bacon rates to its employees.  

The Union brought this action, in which it alleges that

Horning’s Certified Payroll Reports and the eight applications

for payment (along with the certifications of Davis‐Bacon

compliance appearing in both types of documents), violated

the False Claims Act. That Act provides a damages remedy

against any person who “knowingly presents, or causes to be

presented, a false or fraudulent claim for payment.” 31 U.S.C.

§ 3729(a)(1)(A). It permits a private party, known as a relator,

to sue on behalf of the United States in specified circum‐

stances. Id. § 3730(b). The Union is seeking to take advantage

of that provision. It argues that Horning, through the actions

of Moore and Torres, “knowingly ... cause[d] to be presented

[] a false or fraudulent claim for payment.” Id. § 3729(a)(1)(A).

After discovery, the parties filed cross‐motions for summary

judgment. Finding that Horning had relied on the advice of

its accountants and thus did not have the requisite knowledge

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that its statements were false, the district court granted Horn‐

ing’s motion. The Union appeals.

II

A

Before we may turn to the merits of this appeal, we must

assure ourselves that the district court’s jurisdiction was se‐

cure. On the surface, this seems clear: the Union’s claims rest

on the False Claims Act, which indicates that federal‐question

jurisdiction exists under 28 U.S.C. § 1331. Horning resists this

simple conclusion, however, for two reasons: first, it contends

that the Union is not the original source of the information on

which the suit is based and thus is not entitled to act as a re‐

lator (i.e. as the one asserting the interests of the United States

in not paying false claims); second, it argues that the Depart‐

ment of Labor has “primary jurisdiction” here, and that its au‐

thority ousts the district court’s power to adjudicate the case.

We find no merit in either of these contentions.

It is true that claims that previously have been disclosed

may be brought only in limited circumstances, see 31 U.S.C.

§ 3730(e)(4), and that this rule is jurisdictional, see Rockwell

Int’l Corp. v. United States, 549 U.S. 457, 467 (2007). But both

sides acknowledge that the Union’s allegations had not been

“publicly disclosed” before this suit was filed. Section

3730(e)(4) thus does not apply, and it makes no difference

whetherthe Union was an original source. See Glaser v. Wound

Care Consultants, Inc., 570 F.3d 907, 913 (7th Cir. 2009) (recog‐

nizing that section 3730(e)(4) applies only to “publicly dis‐

closed” allegations). That disposes of Horning’s first objec‐

tion.

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No. 15‐1004 7

Its second one is equally unavailing. Despite the label, the

doctrine of “primary jurisdiction” is not jurisdictional in the

sense that matters here. Illinois Bell Tel. Co. v. Global NAPs Illi‐

nois, Inc., 551 F.3d 587, 595 (7th Cir. 2008); cf. Lexmark Int’l, Inc.

v. Static Control Components, Inc., 134 S. Ct. 1377, 1387–88 & n.4

(2014) (emphasizing that few doctrines are truly “jurisdic‐

tional”). “Primary jurisdiction” is a permissive doctrine that

applies when resolving a claim “requires the resolution of is‐

sues which, under a regulatory scheme, have been placed

within the special competence of an administrative body.”

United States v. Western Pac. Ry. Co., 352 U.S. 59, 63–64 (1956).

In such cases, a federal court may stay the proceeding to allow

the agency to take the first look at the case. Illinois Bell Tel. Co.,

551 F.3d at 595.  

There is no need here to defer to the Department of Labor.

Although it has special expertise in classifying employees for

Davis‐Bacon purposes, this case does not present a classifica‐

tion dispute. As the Sixth Circuit put it, when the “core dis‐

pute ... involves misrepresentation, not misclassification,”

primary jurisdiction does not prevent a federal court from

hearing a False Claims Act case that rests on alleged Davis‐

Bacon violations. United States ex rel. Wall v. Circle C Const.,

LLC, 697 F.3d 345, 354 (6th Cir. 2012). That perfectly describes

our case, and so we proceed to the merits.

B

To defeat the district court’s grant of summary judgment

in Horning’s favor, the Union must be able to point to evi‐

dence from which a reasonable jury could conclude “(1) that

the defendant made a statement in order to receive money

from the government; (2) that the statement was false; and (3)

that the defendant knew the statement was false.” Thulin v.

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8 No. 15‐1004

Shopko Stores Operating Co., LLC, 771 F.3d 994, 998 (7th Cir.

2014); see also Universal Health Servs., 136 S. Ct. at 1996.  

The Union has presented more than enough to satisfy the

first element. Horning’s employee, Torres, made statements

to the government in order to receive money for Horning

from it. She submitted the Certified Payroll Reports and the

eight applications that initially went to Construct Solutions

with the knowledge that they were to be presented to the De‐

partment of Veterans Affairs for payment. See United States ex

rel. Garbe v. Kmart Corp., No. 15‐1502, 2016 WL 3031099, at *4

(7th Cir. May 27, 2016) (False Claims Act liability can attach

to any claim that eventually is submitted to the government,

even if it goes through an intermediary).  

The second element, which may well be affected by Uni‐

versal Health Services, is less certain. It is not clear whether this

is the kind of “implied false certification” that the Court dis‐

cussed in its opinion, but it seems that it may be, in the ab‐

sence of an affirmative lie. The Court held that “liability can

attach when the defendant submits a claim for payment that

makes specific representations about the goods or services

provided, but knowingly fails to disclose the defendant’s non‐

compliance with a statutory, regulatory, or contractual re‐

quirement. In these circumstances, liability may attach if the

omission renders those representations misleading.” Univer‐

sal Health Servs., 136 S. Ct. at 1995. We see no need, however,

to solicit briefing on the effect of Universal Health Services, be‐

cause it is possible to resolve this case on the basis of the final

element: whether any misrepresentations Horning made

were “knowing.”

While the statute does not require a specific intent to de‐

fraud, it does state that the defendant must “have acted with

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
No. 15‐1004 9

‘actual knowledge,’ or with ‘deliberate ignorance’ or ‘reckless

disregard’ to the possibility that the submitted claim was

false.” United States v. King‐Vassel, 728 F.3d 707, 712 (7th Cir.

2013) (quoting 31 U.S.C. § 3729(a)(1)(A), (B)) (emphasis omit‐

ted). “Innocent mistakes or negligence are not actionable.”

Hindo v. Univ. of Health Sciences/The Chicago Med. Sch., 65 F.3d

608, 613 (7th Cir. 1995). In the FCA context, the reckless disre‐

gard required to show the necessary knowledge is “an exten‐

sion of gross negligence.” King‐Vassel, 728 F.3d at 712 (internal

quotation marks omitted) (quoting United States v. Krizek, 111

F.3d 934, 942 (D.C. Cir. 1997)); cf. Universal Health Servs., 136

S. Ct. at 2003–04 (stressing the importance of the False Claims

Act’s scienter requirement and the demanding standard for

proving materiality).

The Union has not met that standard. It argues that be‐

cause all employees who worked on the project had $5.00 per

hour deducted from their paychecks, and at least some of the

employees had not worked for Horning long enough to re‐

ceive benefits, then Horning must have known that it was not

giving each employee the full value of the $5.00 deducted. The

Union further urges that not all employees received the full

value of theirfringe benefits because the Trust covered expen‐

sive medical treatments for some and nothing for others. In

other words, it says, because Horning never tried to deter‐

mine whether each employee received the equivalent of $5.00

per hour in medical, dental, vision, or life insurance, Horning

acted with reckless disregard with respect to its handling of

fringe benefits.

The fallacy in the Union’s argument lies in its failure to

distinguish between payments for these insurance‐like bene‐

fits and payment of later claims submitted. The value of

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10 No. 15‐1004

health insurance, for example, is not computed by asking how

much medical care a person consumed; it is how much the

person pays each month to purchase the desired policy. Horn‐

ing was under no obligation to track down each employee to

see if his or her claims worked out to $5.00 times the number

of hours worked over a relevant period. Certainly nothing in

the Davis‐Bacon Act requires this unusual approach. The Act

defines “prevailing wages” to include fringe benefits, and it

defines those benefits as including payment  

for medical or hospital care, pensions on retirement or

death, compensation for injuries or illness resulting

from occupational activity, or insurance to provide any

of the forgoing ... for vacation and holiday pay ... or

for other bona fide fringe benefits ... the amount of—

(i) the rate of contribution irrevocably made by

a contractor or subcontractor to a trustee ... un‐

der a fund ...; and  

(ii) the rate of costs to the contractor ... that may

be reasonably anticipated in providing benefits

... pursuant to an enforceable commitment to

carry out a financially responsible plan[.]

40 U.S.C. § 3141(2). This passage does not suggest that the

value paid out from a fund is the proper measure of the value

of a benefit. Nor do the regulations from the Department of

Labor take this position. To the contrary, the Act and the reg‐

ulations state that the employer’s contribution to a “conven‐

tional plan” for fringe benefits can count toward the fringe

benefit rate. Id. § 3141(2)(B)(i); 29 C.F.R. § 5.29(d) (“Contrac‐

tors may take credit for contributions made under such con‐

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
No. 15‐1004 11

ventional plans without requesting the approval of the Secre‐

tary of Labor[.]”). Since the Davis‐Bacon Act does not require

Horning to compute the value of benefits in the odd manner

called for by the Union, the fact that Torres and Moore failed

to do so tells us nothing about whether they knew that their

certifications of Horning’s compliance with the Act were

false.  

The fact that some of the employees from whose checks

the $5.00 deductions were made were not yet eligible to re‐

ceive fringe benefits does not matter either. The Department

of Labor has stated that the Davis‐Bacon Act permits an em‐

ployer to count contributions to an insurance plan for em‐

ployees who are not yet eligible for coverage when the plan

itself requires the employer to make that contribution during

the waiting period. See Dep’t of Labor, Field Operations

Handbook, § 15f13, available at https://www.dol.gov/whd/foh

/foh_ch15.pdf (last visited June 18, 2016); William J. Lang Land

Clearing, Inc. v. Admin., 520 F. Supp.2d 870, 885 (E.D. Mich.

2007). The Department of Labor does not tell us whether sec‐

tion 15f13 applies to contributions to a trustratherthan a plan.

Nor does the record tell us whether Horning was contractu‐

ally obligated to make contributions to the Trust during the

90‐day waiting period for new employees. We thus neither

can nor do decide whether Horning violated the Davis‐Bacon

Act by deducting Trust contributions from the paychecks of

employees whose rights to fringe benefits had not yet vested.

All that is relevant for present purposes is that there is enough

ambiguity about this matterthat we cannot inferthat Horning

either knew or must have known that it was violating the Da‐

vis‐Bacon Act.

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12 No. 15‐1004

C

We conclude with a few words about Horning’s asserted

reliance on its accountants. The district court decided, and

Horning has argued on appeal, that this fact alone is enough

to negate its knowledge. We do not agree with that flat state‐

ment, and as we have shown above, our decision rests on the

full record that was made on summary judgment.

In some situations, reliance on the advice of a professional,

such as an attorney or an accountant, “can negate the mental

state required for some crimes.” United States v. Roti, 484 F.3d

934, 935 (7th Cir. 2007); see also United States v. Boyle, 469 U.S.

241, 250 (1985) (recognizing that a taxpayer who “relie[s] on

the erroneous advice” of counsel, an accountant, or a tax ad‐

viser, may have “reasonable cause” for failing to file a return);

United States v. Urfer, 287 F.3d 663, 665–66 (7th Cir. 2002) (“the

fact that he was acting on the advice of counsel ... bears on

whether he knew that he was violating the statute”). A de‐

fendant may not rely on this type of advice, however, unless

she establishes that (1) before taking action (2) she “in good

faith sought the advice of [the professional] whom [she] con‐

sidered competent,” (3) about the lawfulness of her future

conduct, (4) she made a “full and accurate report” of all rele‐

vant facts to the professional, and (5) she acted in strict ac‐

cordance with the advice. United States v. Cheek, 3 F.3d 1057,

1061 (7th Cir. 1993) (on remand from Supreme Court, internal

quotation marks omitted) (quoting Liss v. United States, 915

F.2d 287, 291 (7th Cir. 1990)).  

Horning did not develop the facts that were needed to

provide a basis for an “advice‐of‐accountant” defense. We do

not know precisely what it told its accountants, whether they

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No. 15‐1004 13

provided all necessary details, or what exactly the account‐

ants recommended. We therefore cannot say whether any re‐

liance that followed was reasonable and thus sufficient to ne‐

gate any inference that Horning knew that its statements were

false, and for that reason we place no weight on this point.

III

Horning may, or may not, have violated the Davis‐Bacon

Act. But the Union did not bring a claim under that statute.

Instead, it sued under the False Claims Act, which requires

proof that the defendant knowingly submitted a false claim to

the government for payment. The Union did not present

enough evidence to survive summary judgment on that issue,

and so we AFFIRM the judgment of the district court.  

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14 No. 15‐1004

POSNER, Circuit Judge, dissenting. For Horning, the em‐

ployer defendant, to be found to have violated the False

Claims Act, the union had to prove that the company had

“knowingly present[ed], or cause[d] to be presented [to the

government], a false or fraudulent claim for payment or ap‐

proval.” 31 U.S.C. § 3729(a)(1)(A). The employer does not

have to have intended to defraud (i.e., cheat) the government.

§ (b)(1)(B). It just has to have known that the claim it’s sub‐

mitting is false, or act in reckless disregard of its truth or fal‐

sity. § (b)(1)(A). It might think the falsehood harmless—it

might for example be sure the claim would be turned

down—or it might think it had underclaimed in the past,

and the false claim if accepted would merely place it in the

position it would be in, rightfully, had it not made such mis‐

takes. But as long as the claimant knows that its representa‐

tions are both false and “material” (i.e., relevant in the sense

of “having a natural tendency to influence, or be capable of

influencing, the payment or receipt of money or property”

by the government, § (b)(4)), it has violated the False Claims

Act. Universal Health Services, Inc. v. United States ex rel. Esco‐

bar, 136 S. Ct. 1989, 1996 (2016).

By way of background it needs to be understood that a

separate statute, the Davis‐Bacon Act, establishes a mini‐

mum wage for workers on certain federal construction pro‐

jects, 40 U.S.C. § 3142, among them a project in Dayton,

Ohio, for which Horning was a contractor. That minimum

(which is based on the prevailing wage for similar work in

the location in which the work will be performed, § 3142(b))

includes fringe benefits. § 3141(2). For example, Horning

was required to pay roofers a wage of $22.36 an hour plus

$11.58 an hour in fringe benefits, for a total of $33.94 an

hour. The fringe benefits included insurance: $5 of the $11.58

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
No. 15‐1004 15

was not paid to the employees but instead was to be used to

fund an insurance program for them (“the trust”).

The false‐claims evidence begins with the false statement,

in the Certified Payroll Reports that Horning submitted to

the Department of Veterans Affairs, that “all persons em‐

ployed on [the] project have been paid the full weekly wages

earned ... and no deductions have been made either directly

or indirectly from the full wages earned by any person, other

than permissible deductions.” An employee named Federico

Gonzalez had $5 per hour deducted from his pay and placed

into the fringe‐benefits trust even though he was ineligible to

receive benefits from the trust. The Davis‐Bacon Act permits

an employer to count contributions to an insurance plan for

employees not yet eligible for coverage only if the plan re‐

quires the employer to make those contributions during the

employee’s waiting period—that is, after the employee has

been hired but before he is eligible for benefits. See Dep’t of

Labor, Field Operations Handbook § 15f13, www.dol.gov/whd/

foh/foh_ch15.pdf (visited July 7, 2016). Horning had contrib‐

uted $5 per hour to the insurance trust ostensibly for Gonza‐

lez’s benefit for over two months longer than his waiting pe‐

riod, which was 90 days. Because he wasn’t receiving the $5

an hour either in cash or in insurance during that two‐month

period, he was receiving less than the Davis‐Bacon Act enti‐

tled him to.  

There is uncontradicted evidence that four other Horning

workers had $5 per hour of work credited to the trust as well

even though like Gonzalez they didn’t participate in the

benefits program and so never benefited from the $5 that

was an ostensible part of their compensation—a part, I re‐

peat, to which Davis‐Bacon entitled them.

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
16 No. 15‐1004

Horning’s manager of human resources acknowledged

that the $5 per hour subtracted from the workers’ compensa‐

tion was not based on an estimate of the benefits the worker

would or might receive. She said that “Horning would put

that money how they—you know, how they [the manage‐

ment] saw fit on that money. It wasn’t just cash money in

[the worker’s] hand”—or, in the case of the five workers

we’ve mentioned, money in their insurance accounts. No

one in management attempted to match the $5 deductions to

each employee’s eligibility to receive benefits, even though

as an experienced contractor on Davis‐Bacon Act projects

Horning’s executives must have known about the statute’s

requirements. See United States ex rel. Wall v. Circle C Con‐

struction, L.L.C., 697 F.3d 345, 356–57 (6th Cir. 2012). If they

didn’t know, it must have been because they closed their

eyes to those requirements—a good example of ostrich be‐

havior, itself a good example of deliberate indifference with‐

in the meaning of the False Claims Act.

A nontrivial part of the investment fund financed by the

$5 wage deductions—at least $54,000—was diverted to the

company’s owner and to a relative of the general manager,

neither of whom, so far as the record reveals, was entitled to

receive money from the insurance fund. This is further evi‐

dence that Horning knowingly made false statements in

claiming that the $5 of “fringe benefits” it took out of each

worker’s hourly salary went to “appropriate programs for

the benefit of such employees,” that is, by buying insurance

for the employee. When “a defendant makes representations

in submitting a claim but omits its violations of statutory,

regulatory, or contractual requirements, those omissions can

be a basis for liability if they render the defendant’s repre‐

sentations misleading with respect to the goods or services

Case: 15-1004 Document: 36 Filed: 07/07/2016 Pages: 17
No. 15‐1004 17

provided.” Universal Health Services, Inc. v. United States, su‐

pra, 136 S. Ct. at 1999. That’s this case.

To understand the full scope and gravity of Horning’s

conduct, we need to remand the case for a trial. We need to

know how many employees were forced to contribute $5 of

their compensation to a trust from which they could not

benefit or how much less they received than they were enti‐

tled to. But we need to know even more. The company’s

principal defense is not that it never underpaid its workers,

in violation of the Davis‐Bacon Act, but that it had relied on

its accountants to advise it with respect to its duty to pay its

workers the minimum wage required by that Act, and that

since it followed their advice it can’t have knowingly violat‐

ed the False Claims Act. But no evidence has been presented

that the accountants in question had the necessary expertise,

understood the Davis‐Bacon Act (the source of Horning’s

duty to pay its workers the prevailing wage), actually ad‐

vised Horning of the Act’s requirements, or received full

disclosure from Horning concerning the administration of

the trust. There is also reason to believe that Horning didn’t

rely on the accountants’ advice in good faith.

In short, it is premature to exonerate Horning.

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