Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-05-05008/USCOURTS-caDC-05-05008-0/pdf.json

Parties Involved:
Robert A. Berman
Appellee
Project on Government Oversight
Appellant
United States of America
Appellee

Document Text:

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued November 18, 2005 Decided July 14, 2006

No. 05-5008

UNITED STATES OF AMERICA,

APPELLEE

v.

PROJECT ON GOVERNMENT OVERSIGHT,

APPELLANT

Appeal from the United States District Court

for the District of Columbia

(No. 03cv00096)

Andrew D. Herman argued the cause for appellant. With

him on the briefs were Stanley M. Brand and Ross A. Nabatoff.

Robert M. Loeb, Attorney, U.S. Department of Justice,

argued the cause for appellee United States of America. With

him on the brief were Peter D. Keisler, Assistant Attorney

General, Kenneth L. Wainstein, U.S. Attorney, and Douglas N.

Letter, Litigation Counsel.

Before: GINSBURG, Chief Judge, and GARLAND and

BROWN, Circuit Judges.

Opinion for the Court filed by Circuit Judge GARLAND.

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1

The False Claims Act imposes a civil penalty and treble damages

on any person who, inter alia, “knowingly presents, or causes to be

GARLAND, Circuit Judge: The Project on Government

Oversight (POGO), a non-profit organization, appeals from the

district court’s grant of summary judgment holding it liable for

violating 18 U.S.C. § 209(a). That statute prohibits a private

party from making a contribution to the salary of an executive

branch official “as compensation for his services” as a

government employee. The district court found there was no

genuine dispute that POGO violated § 209(a) by issuing a check

to a Department of Interior economist. We conclude, however,

that there was a genuine dispute as to whether POGO issued the

check as compensation for the economist’s government service.

Accordingly, we reverse the judgment of the district court and

remand the case for further proceedings. 

I

POGO is an organization that “investigates, exposes and

seeks to remedy systematic abuses of power, mismanagement,

and subservience of the federal Government to special

interests.” Appellant’s Br. 5. In December 1993, POGO began

investigating whether oil companies were committing fraud by

undervaluing the amount of oil that they extracted from federal

and Indian lands, resulting in the underpayment of royalties

owed to the United States. Over the next three years, POGO

undertook numerous efforts to focus public attention on the

issue. On June 9, 1997, after concluding that the government

was unlikely to pursue the matter, POGO filed two qui tam

actions in the United States District Court for the Eastern

District of Texas. The actions alleged that major oil companies

had violated the False Claims Act, 31 U.S.C. § 3729, by

undervaluing the oil they extracted and then underreporting and

underpaying the oil royalties they owed.1

 After POGO filed the

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presented, to an officer or employee of the United States

Government[,] . . . a false or fraudulent claim for payment or

approval.” 31 U.S.C. § 3729(a). Section 3730(b) provides that a

“private person[,]” commonly known as a “relator,” may bring a civil

action for a violation of § 3729 “in the name of the Government.” 31

U.S.C. § 3730(b). Such an action is known as a “qui tam” suit. The

statute permits the government to take over the action and conduct it

itself, or to decline to take over the action, in which case the relator

has the right to conduct it. See id. The relator is entitled to different

percentages of any recovery from a successful False Claims Act suit,

depending upon whether the relator or the government conducts the

action. See 31 U.S.C. § 3730(d)(1)-(2); see generally United States ex

rel. Yesudian v. Howard Univ., 153 F.3d 731, 736 (D.C. Cir. 1998).

suit, the United States intervened and entered into settlement

agreements that eventually totaled $440 million.

During the course of its investigation, POGO spoke with

many people, including Robert A. Berman, a senior economist

at the Interior Department. Beginning in 1994, POGO’s

executive director, Danielle Brian, had between twenty and

thirty telephone conversations with Berman in which they

discussed oil royalty issues. In 1996, Brian asked Berman

whether he wanted to join POGO as a co-relator in the qui tam

actions that the organization intended to file. See supra note 1.

Although Berman declined POGO’s offer to be a co-relator, he

subsequently entered into an agreement with POGO providing

that he would receive one-third of any money that POGO

recovered through the litigation. See J.A. 67. POGO also

agreed to give a one-third share to Robert Speir, an economist

at the Department of Energy, with whom it also had discussed

the issue of oil royalties. See id.

After POGO received its $1.2 million share of the first

settlement in the qui tam actions, POGO attorney Lon Packard

informed Kenneth Dodd, the Assistant United States Attorney

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working on the qui tam litigation, that POGO intended to give

Berman a portion of its recovery. See Def. POGO’s Statement

of Material Facts ¶ 36. Although Dodd informed other officials

at the Justice Department of POGO’s intention, no one told

POGO to abandon its plan to remunerate Berman. See id. at ¶

42. In addition, Berman consulted his government ethics officer

to determine whether he could legally accept the proposed

payment. See Brian Dep. 256 (July 23, 1999). Berman reported

to Brian that the ethics officer advised that he could accept it.

See id. On November 2, 1998, POGO issued a check to Berman

in the amount of $383,600. The face of the check indicated that

it was a “Public Service Award,” and the accompanying letter

from POGO explained that it was given to Berman for his

“decade-long public-spirited work to expose and stop the oil

companies’ underpayment of royalties for the production of

crude oil on federal and Indian lands.” J.A. 73-74. 

On January 21, 2003, the Justice Department filed a civil

complaint against Berman and POGO charging, inter alia, that

the payment and receipt of the $383,600 violated 18 U.S.C. §

209(a). The government moved for summary judgment on the

§ 209(a) count on April 28, 2003, and POGO cross-moved on

June 24, 2003. A year later, on June 22, 2004, the district court

convened the parties and told them that the case appeared illsuited for summary judgment: “Counsel, I have looked over this

file and I’ll tell you what my inclination at this point is. I do not

think that I could grant either [m]otion for [s]ummary

judgment.” Hr’g Tr. 2 (June 22, 2004). Noting that the case

was “fact depend[e]nt,” id. at 6, the court told the parties: “I’m

going to ask you to come back here in two weeks and tell me

when you could try the case.” Id. at 7. 

When the parties reconvened two weeks later, however, the

district court reversed course. This time, the court told the

parties: “I don’t like the implications of what it was that Mr.

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2

No appeal has been filed by defendant Berman, and the parties

have made no representations regarding his status. 

Berman did, and I think that this reaches it. I may be wrong.”

Hr’g Tr. 19 (July 9, 2004). On August 31, 2004, the court

granted the government’s motion for summary judgment on the

charge that POGO and Berman violated § 209(a). The court’s

order contained no explanation, other than that the motion was

granted “for substantially the reasons set forth in Plaintiff’s

memorandum in support.” See United States v. Project on Gov’t

Oversight, No. 03-0096, Order at 1 (D.D.C. Aug. 31, 2004). At

the same time, the court certified its order for immediate appeal

pursuant to 28 U.S.C. § 1292(b). See id. POGO’s appeal is now

before us.2 

II

We review the district court’s grant of summary judgment

de novo. See Waterhouse v. District of Columbia, 298 F.3d 989,

991 (D.C. Cir. 2002). Summary judgment is appropriate only if

“‘there is no genuine issue as to any material fact and . . . the

moving party is entitled to a judgment as a matter of law.’”

Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986)

(quoting FED. R. CIV. P. 56(c)). A dispute about a material fact

is genuine “if the evidence is such that a reasonable jury could

return a verdict for the nonmoving party.” Id. at 248. We must

view the evidence in the light most favorable to the nonmoving

party, draw all reasonable inferences in its favor, and eschew

making credibility determinations or weighing the evidence.

See Lathram v. Snow, 336 F.3d 1085, 1088 (D.C. Cir. 2003)

(citing Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 150

(2000)). 

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A

Section 209(a) provides, in relevant part:

Whoever receives any salary, or any contribution to or

supplementation of salary, as compensation for his

services as an officer or employee of the executive

branch of the United States Government, . . . from any

source other than the Government of the United States

. . .; or

Whoever . . . makes any contribution to, or in any way

supplements, the salary of any such officer or

employee under circumstances which would make its

receipt a violation of this subsection --

Shall be subject to the penalties set forth in section 216

of this title.

18 U.S.C. § 209(a). The referenced section, § 216(a), provides

that whoever “engages in the conduct constituting the offense”

shall be imprisoned for not more than one year, 18 U.S.C. §

216(a)(1), and that whoever “willfully engages in the conduct

constituting the offense” shall be imprisoned for not more than

five years, 18 U.S.C. § 216(a)(2). Section 216(b) authorizes the

Attorney General to bring a civil action, as he did in this case,

against any person who “engages in conduct constituting an

offense under section . . . 209,” and provides that “upon proof of

such conduct by a preponderance of the evidence, such person

shall be subject to a civil penalty.” 18 U.S.C. § 216(b).

In light of the statutory language, both parties agree that one

element of the offense that the government must prove by a

preponderance of the evidence is that POGO made a

contribution to or supplementation of Berman’s salary “as

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compensation for his services as an officer or employee” of the

United States. 18 U.S.C. § 209(a); see Appellee’s Br. 14, 15;

Appellant’s Br. 20, 29-32. As we held in United States v.

Muntain, “[f]or there to be a violation of § 209, . . . the

contribution must have been received as compensation for

services and those services must have been rendered as an

employee of the United States.” 610 F.2d 964, 969 (D.C. Cir.

1979) (internal quotation marks omitted); accord United States

v. Raborn, 575 F.2d 688, 691-92 (9th Cir. 1978).

Services that a government employee provides other than as

part of his official responsibilities do not satisfy this

requirement. In Muntain, for example, we found that the

Assistant to the Secretary for Labor Relations at the Department

of Housing and Urban Development (HUD), who functioned as

HUD’s chief liaison with organized labor and chief spokesman

on labor relations matters, did not violate § 209(a) by receiving

compensation for promoting a private insurance scheme to labor

unions. See 610 F.2d at 966, 969-70. In reaching that

conclusion, we indicated that the statute is violated if the

compensation is “‘for the [s]ervices rendered to the

Government,’” or if the “‘employee renders the same or similar

services to both the Government and a private person.’” 610

F.2d at 970 n.5 (quoting 41 Op. Att’y Gen. 217, 220 (1955)).

The statute “‘does not, however, prohibit payment for services

rendered exclusively to private persons or organizations and

which have no connection with the services rendered to the

Government.’” Id. (quoting 41 Op. Att’y Gen. at 220); see

Crandon v. United States, 494 U.S. 152, 165 (1990) (“‘[T]his

rule prohibit[s] two payrolls and two paymasters for the same

employee on the same job.’” (quoting with approval Association

of the Bar of the City of New York, Conflict of Interest and

Federal Service 211 (1960)) (emphasis added)).

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3

See also Summary of the Restriction on Supplementation of

Salary, Off. Gov’t Ethics 3-4 (2002) (“To make out an offense under

section 209, there must be a direct linkage between the thing of value

paid to the employee and the official services rendered by the

employee.”).

4

The Senate Report stated: “Section 209 is similar to . . . [the

former 18 U.S.C. §] 1914. . . . The new language is more precise in

expressing what is clearly intended by the present broad phrase.” S.

REP. NO. 87- 2213, at 14 (1962).

The Department of Justice has itself concluded that § 209

does not “prohibit all non-government payments to an individual

where there is any nexus between the payment and the

individual’s employment by the government.” Application of

18 U.S.C. § 209 to Employee-Inventors Who Receive Outside

Royalty Payments, Op. Off. Legal Counsel, U.S. Dep’t Justice,

2000 WL 33952879 (Sept. 5, 2000) (internal quotation marks

omitted). Rather, the statute requires “an intentional, direct link

between the outside compensation and the employee’s

government service.” Id.

3

 The Department’s conclusion was

based on a 1962 amendment that substituted the “as

compensation for” requirement for the previous requirement that

the payments be “in connection with” an employee’s services to

the government. Id. As the House Report explained, the

amendment was made “in order to emphasize the intent that the

prohibition is against private payment made expressly for

services rendered to the Government”; Congress regarded the

former “in connection with” phrase as too “vague and capable

of an indefinitely broad interpretation.” H.R. REP. NO. 87-748,

at 24-25 (1961).4

The district court’s grant of summary judgment against

POGO can thus be upheld only if there is no genuine dispute

that POGO paid Berman as compensation for his services as an

Interior Department economist. The government contends that

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is precisely the case: “POGO paid Mr. Berman because of the

work he had done for Interior and for his assistance to POGO in

connection with that work.” Appellee’s Br. 8. POGO, however,

insists that there is a genuine dispute regarding this point. It

gave the award, POGO explains, not as compensation for

Berman’s government work, but in recognition of

whistleblowing that assertedly was outside the scope of that

work. See Brian Dep. 112 (July 23, 1999).

B

The government offers an array of evidence supporting its

contention that POGO paid Berman as compensation for his

government service. First, the government proffers evidence

regarding the nature of Berman’s job at the Interior Department.

It cites affidavits, filed by Berman’s supervisors at Interior’s

Office of Policy Analysis, which state that “[d]uring the period

from 1993-96, and possibly before, [Berman] was the lead

analyst in the office on oil royalty valuation issues,” Bettenberg

Aff. 2; that his responsibilities included the “policies and

procedures used for the collection of royalties on oil and gas

leases issued by the Department,” Heintz Aff. 1; and that he was

“part of an interagency task force dealing with oil valuation

issues,” id. at 2. The government also contends that, when

Berman testified before a congressional committee in 1996, he

made many of the same allegations that POGO would later make

in its qui tam complaint. 

Second, the government cites testimony by POGO’s

Danielle Brian which, it argues, shows that the services that led

POGO to compensate Berman were the same as those he

provided the government. In depositions taken during the qui

tam litigation, Brian testified that she “considered Mr. Berman

an ally and an asset in [the] effort . . . on the oil royalty

question.” Brian Dep. 71 (July 23, 1999). She conceded that,

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before filing the qui tam suit, she had roughly twenty to thirty

conversations with Berman. See id. at 81. Brian said that

Berman helped her understand issues relating to the

underpayment question, see id. at 69, and that he helped her

draft a Freedom of Information Act (FOIA) suit for documents

in the possession of the government, see id. at 72. She also

testified that she sought out Berman because he had been one of

the “people who had . . . for a decade” tried “to get the

government to do something about the underpayment of

royalties,” id. at 112; because he “was known as the only person

in the [D]epartment who was really caring about this issue,” id.

at 64; and because he was “a great advocate on this issue

internally” within the Department, id. at 69. Indeed, she

testified that a memorandum written by Berman (apparently in

1986), which was leaked to her by an anonymous source, proved

critical to her understanding of the oil royalties scheme. See id.

at 106-07.

Finally, the government points to further statements by

Brian that it regards as express admissions that POGO paid

Berman as compensation for his government work. These

include minutes of a POGO Board of Directors’ meeting that

discussed the agreement to pay Berman a portion of the qui tam

recovery. The minutes stated: “Ms. Brian mentioned that an

agreement has been worked out that if there is some reward, . .

. the individuals that have been doing this work for years would

be compensated.” J.A. 53 (emphasis added). The government

also cites the letter Brian sent to Berman accompanying the

$383,600 check, which said: “We are giving you this check as

an award for your decade-long public-spirited work to expose

and stop the oil companies’ underpayment of royalties.” J.A.

73. In addition, a press release that POGO drafted to announce

the payments to Berman and Speir described the two as “loyal

public servants [who] have played a central role in fixing many

serious problems within government,” and noted that “it seemed

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5

Providing some support for Berman’s position is Brian’s

testimony that Berman “checked with his ethics officer” and was told

that he “was allowed to accept the money.” Brian Dep. 256 (July 23,

1999). Although “[n]either good faith, nor full disclosure” is a

defense to a § 209(a) civil action, see Crandon, 494 U.S. at 165, the

advice of the Interior Department ethics officer may be evidence that

the Department did not view Berman’s official work as the same as or

similar to that for which he was being rewarded by POGO. And

Berman’s report to Brian regarding that advice may be seen as

evidence confirming POGO’s understanding, see discussion infra, that

the work was different.

only fair that the two unsung heros be compensated in keeping

with the spirit of the False Claims Act.” J.A. 111 (emphasis

added).

C

Although the government’s evidence is impressive, there is

also evidence that contradicts it. First, Berman has stated that

his supervisors’ depiction of his Interior Department

responsibilities is “false.” Def. Berman’s Mem. in Opp’n to

Pl.’s Mot. For Summ. J. & in Supp. of Def. POGO’s Cross Mot.

for Summ. J., Ex. 9, Berman Decl. ¶ 9. “At no time during [my]

tenure,” he declared, “did I have any programmatic authority or

responsibility over oil pricing policies or royalty collection

policies at [Interior].” Id. at ¶ 1. Supervisor Theodore Heintz’s

affidavit was “particularly deceptive,” Berman said, in

describing his “area of responsibility” as “policies and

procedures with respect to the collection of royalties for oil and

gas leases issued by the Department.” Def. Berman’s

Counterstatement of Material Facts ¶ 70. Moreover, “[c]ontrary

to the assertion contained in [Heintz’s] affidavit,” he “never

served on the Interagency Taskforce . . . on oil prices and oil

royalty collection.” Berman Decl. ¶ 7.5

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According to Berman, although he did study oil pricing and

royalties collection policies from 1986 to 1987, he did so on his

own initiative and, impliedly, not as part of his government

responsibilities. See id. at ¶ 4. It was during this period that

Berman wrote the internal memorandum later obtained by

POGO. See Def. Berman’s Counterstatement of Material Facts

¶¶ 9-10. Thereafter, however, Interior officials told him to stop

making suggestions because it “create[d] unnecessary

problems,” and he “complied with this instruction.” Berman

Decl. ¶ 5. Following the “rejection of his suggestion[s] in

1987,” Berman said, he “ceased his analysis of the oil

companies’ underpayment of royalties.” Def. Berman’s

Counterstatement of Material Facts ¶ 21. Although Berman’s

statements are somewhat ambiguous, they suggest that

continuing efforts he made to alert his supervisors “about the

fraudulent practices” of the oil companies represented an

independent undertaking that was not part of his official

responsibilities. Berman Decl. ¶ 8.

Second, POGO denies that it compensated Berman for

services that it thought were part of his government

responsibilities. Supporting this denial is Brian’s qui tam

testimony that she believed “it wasn’t [Berman’s] job to look

into whether . . . royalties had been underpaid by these

companies,” Brian Dep. 353 (Sept. 13, 1999), and that at the

time she discussed a proceeds-sharing agreement with Berman,

his government work did not involve the oil royalty issue at all,

id. at 395. Brian also testified that it was she who suggested that

congressional staff call Berman as a witness on the royalty issue,

and that he testified against the Interior Department’s wishes

and position. See Brian Dep. 90-91 (July 23, 1999). That,

POGO insists, is the meaning of Brian’s statement that Berman

was one of the “people who had . . . for a decade [tried] to get

the government to do something about the underpayment of

royalties,” id. at 112, and that he “was known as the only person

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6

Cf. Def. POGO’s Statement of Material Facts 11 (statement by

Dodd, the government’s lead attorney on the qui tam litigation, that

Berman “played absolutely no role in my office’s, and as I understand

it, Commercial Litigation’s decision to intervene in these [qui tam]

cases, an evaluation of the merit of the cases against the oil companies,

any settlement or settlement discussions with any of the oil companies

or any of the computations of damage analysis that were done”). The

civil complaint filed by the government does include other counts

against Berman, including “Breach of Fiduciary Duty.” Compl. ¶¶ 48-

51. Berman is not a party to this appeal, however, and those counts

are not at issue here. 

in the [D]epartment who was really caring about this issue,” id.

at 64.

In her depositions, Brian did not dispute that she considered

Berman “an ally and an asset” on the royalty issue, Brian Dep.

71 (July 23, 1999), and that he helped her in understanding an

issue relating to royalty underpayments, see Brian Dep. 342

(Sept. 13, 1999). But she did dispute that Berman’s assistance

stemmed from his government employment. She testified that

about half the calls she made to Berman were to his home,

because “this wasn’t really a part of what he was working on.”

Brian Dep. 67 (July 23, 1999). And while Brian acknowledged

that Berman helped her draft a FOIA request for government

documents, see id. at 72, she denied that he leaked inside

information to her or that he helped prepare the qui tam case, see

id. at 72-73, 287. Indeed, even if the agreement to divide the qui

tam proceeds suggests the contrary, not even the government

argues that leaking confidential information or helping a

plaintiff prepare a FOIA request or qui tam complaint were part

of Berman’s job description.6

 

Finally, POGO argues that the government has taken its

statements about compensating Berman out of context. It does

not deny that it intended to “compensate” him, but insists that it

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neither said nor meant that it compensated him for his

government work. Rather, POGO asserts that the “work” for

which it compensated Berman, as referenced in the Board

minutes, transmittal letter, and draft press release, was work as

an internal “whistleblower who went well beyond his official

duties to defend the taxpayers’ interests.” Appellant’s Br. 36-

37; see Brian Dep. 112 (July 23, 1999); Brian Dep. 353 (Sept.

13, 1999).

D

There is no doubt that the government has made out a

strong case against POGO, that Berman’s declarations lack

clarity and contain some internal contradictions, and that Brian’s

statements provide fodder for potentially damaging crossexamination. POGO may well have an uphill battle in showing

that Berman’s Interior Department duties did not include the

same internal “whistleblowing” for which POGO rewarded him

or that POGO did not understand that to be his responsibility

when it decided to “compensate” him. But the question before

the court is not whether the government has a strong case, or

even whether it has established that case by a preponderance of

the evidence. At “the summary judgment stage[,] the judge’s

function is not himself to weigh the evidence and determine the

truth of the matter but to determine whether there is a genuine

issue for trial.” Anderson, 477 U.S. at 249. The only question

before us is whether there is a genuine dispute that POGO paid

Berman as compensation for his services as a government

employee. 

In light of the evidence reviewed above, we cannot say that

no “reasonable jury could return a verdict” for POGO. Id. at

248. This is particularly so because much of POGO’s defense

hinges on the credibility of Berman and Brian. To be sure, that

credibility may have been undermined by prior statements and

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other evidence. On summary judgment, however, “the court

must view the evidence in the light most favorable to the

nonmoving party and must not assess witness credibility.”

Borgo v. Goldin, 204 F.3d 251, 254 (D.C. Cir. 2000).

Evaluation of the credibility of witnesses must be left to the

factfinder, see Mendes-Silva v. United States, 980 F.2d 1482,

1488 (D.C. Cir. 1993), and “the need to assess the credibility of

witnesses is precisely what places this dispute outside the proper

realm of summary judgment.” Washington Post Co. v. United

States Dep’t of Health & Human Servs., 865 F.2d 320, 326 n.8

(D.C. Cir. 1989). 

III

Although the parties raise a host of additional issues, we

have no reason to reach them. Because there is a genuine issue

of material fact as to whether POGO paid Berman “as

compensation for his services as an . . . employee of the

executive branch,” 18 U.S.C. § 209(a), the district court erred in

granting summary judgment in favor of the government. We

therefore reverse the court’s judgment and remand the matter for

further proceedings.

So ordered.

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