UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

Case No. 1:20-cv-23242-BB

UNITED STATES OF AMERICA ex rel. SEDONA 

PARTNERS LLC, 

Plaintiff,

vs.

ABLE MOVING & STORAGE, INC.; ARPIN 

INTERNATIONAL GROUP, INC.; CARTWRIGHT 

INTERNATIONAL VAN LINES, INC.; COLEMAN 

AMERICAN MOVING SERVICES, INC.; DEWITT 

COMPANIES LIMITED, LLC; HILLDRUP 

COMPANIES, INC.; J.K. MOVING & STORAGE 

INC.; NEW WORLD INTERNATIONAL, LTD.; 

PARAMOUNT TRANSPORTATION SYSTEMS; 

PAXTON VAN LINES, INC.; AND WESTERN 

EXPRESS FORWARDING, LLC,

RELATOR SEDONA PARTNERS LLC’S OPPOSITION TO 

DEFENDANT J.K. MOVING & STORAGE, INC.’S 

MOTION TO DISMISS FIRST AMENDED COMPLAINT

I. INTRODUCTION

This is a qui tam case alleging that Defendant JK Moving & Storage, Inc. (“JK Moving”)

and other private shipping companies known as “Transportation Service Providers,” (“TSPs”) 

submitted fraudulent bids to obtain shipping contracts through the United States Department of 

State (“DOS”) under the supervision and guidance of the United States General Services 

Administration (“GSA”). Specifically, Relator alleges that from approximately 2008 through 

2018, Defendant TSPs carried out a fraudulent scheme whereby hundreds of millions of dollars 

were illegally taken from taxpayers, American workers, and American companies because foreign 

flag vessels were routinely and illegally used by the TSPs, instead of U.S. flag vessels, in violation 

of longstanding “America-First” policies. The scheme was carried out through two false 

submissions to the government: First, Defendant TSPs, including JK Moving, submitted 

fraudulent low-ball bids in order to capture awards for very competitive shipping routes, referred 

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to as “lanes,” across international waters. Second, in order to profit on their low-ball bids, 

Defendants submitted thousands of false foreign flag waivers, requesting permission to use lower 

costing foreign flag vessels, by fraudulently certifying that no U.S. flag vessels were available to 

carry-out shipments and/or that a foreign flag vessel was necessary to meet delivery requirements. 

These waivers were routinely granted to Defendants, resulting in hundreds of millions of dollars 

going to foreign companies instead of American companies. 

JK Moving’s motion to dismiss fails. First, Relator has pled facts sufficient to meet the 

Rule 9(b) requirement of particularity, and has shown reliable indicia that claims were fraudulently 

submitted and presented. Second, JK Moving misunderstands damages and materiality in a false 

claims case and mislabels the case as one relating to underbidding. The America-First policy, 

which is codified in multiple statutes and regulations, mandates that each TSP certify if an 

American vessel is not available. This certification is material to the Government’s decision to 

grant shipping lanes to each TSP. Relator alleges that Defendants falsely certified the 

unavailability of American vessels, and thus were able to submit low-ball bids. Indeed, failing to 

use American vessels, where available, amounted to millions in lost revenue to United States 

vessels, taxpayers, and violated the cornerstone of the DOS’s entire program. Law abiding 

American businesses, which federal law prioritizes, have been locked out of shipping lane 

contracts because of this fraudulent scheme. 

Further, the public disclosure bar is inapplicable because there was no public disclosure of 

the allegations or transactions at issue. Accordingly, Relator respectfully requests JK Moving’s

motion to dismiss be denied, or in the alternative, Relator be given leave to amend. 

II. STATEMENT OF FACTS

A. The Federal Centralized Household Goods Traffic Management Program 

(“CHAMP”) and the “America-First” Policy

Defendant JK Moving & Storage, Inc. (“JK Moving”) provides residential, commercial, and 

international moving services. (First Amended Compl. (“FAC”) ¶ 20.) JK Moving is based in 

Sterling, Virginia and was incorporated under the laws of Virginia. (FAC ¶ 20.) The Company 

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offers moving trucks, storage services, management teams, and advertises international and

employee relocation services. (FAC ¶ 20.) JK Moving promotes its international services by 

touting affiliation with FIDI, IAM, and OMNI. (FAC ¶ 20.) 

The DOS has 307 U.S embassies, consulates, and diplomatic missions around the world 

that require a shipping service for relocation of civilian executive branch employees’ Household 

Goods (“HHG”). (FAC ¶ 29.) The shipping services often include moving services, home sale 

services, property management, and office relocation assistance. Many federal civilian offices pay 

for and assist their employees and families in relocating and moving their belongings through a 

GSA program—the Centralized Household Goods Traffic Management Program (“CHAMP”). 

(FAC ¶ 2.) Shipping providers, or TSPs, participate in the CHAMP program and compete for 

shipping contract awards. In providing these shipping services, participants are subject to various 

strict guidelines and requirements that are overseen and set forth in DOS, GSA, and federal laws 

and regulations. (FAC ¶ 2.) 

One of the key requirements TSPs must follow is the “America-First” policy, which is 

based on federal maritime and cargo laws. (FAC ¶ 2.) This policy requires that the companies 

use “U.S. flag vessels” (American shipping carriers), except in unique circumstances where a 

waiver is obtained for use of a “foreign flag vessel.” (FAC ¶ 2.) Foreign flag vessels are much 

cheaper than American carriers, and do not follow U.S. laws and customs. (FAC ¶ 2.) For

example, U.S. flag carriers are required to have U.S. Citizen crews and pay payroll taxes, and crew 

members pay U.S. income taxes. (FAC ¶ 2.) U.S. flag carriers are subject to Coast Guard 

regulations and environmental regulations, and U.S. flag carrier ships must be built (with some 

exceptions) and repaired in U.S. shipyards. (FAC ¶ 2.) This “America-First” policy has been in 

place for decades and is codified in multiple federal statutes, regulations, and guidelines. (FAC ¶ 

3.) 

With 225 embassies and consulates around the world, DOS uses this program thousands 

of times per year to relocate DOS employees by shipping their belongings both domestically and 

internationally. (FAC ¶ 4.) GSA is in charge of administering the CHAMP program. (FAC ¶ 29.) 

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The program operates through using TSPs, which are qualified and credentialed American private 

shipping companies vetted by GSA. (FAC ¶ 29.) The TSPs must apply to GSA for approval to 

participate in the program. (FAC ¶ 29.) 

CHAMP is subdivided into two separate programs – Domestic and International. (FAC ¶ 

30.) The Domestic program handles both interstate and intrastate shipments between locations in 

the continental United States and Alaska. (FAC ¶ 30.) The International program covers 

shipments between the continental United States and locations elsewhere in the world, including 

Hawaii, Guam, Puerto Rico, the Virgin Islands, and foreign countries. (FAC ¶ 30.) Each program, 

Domestic and International, requires a separate application. (FAC ¶ 31.) 

GSA evaluates TSPs based on their financial stability, business experience, quality 

assurance, and knowledge of the Household Goods Tender of Service (“HTOS”), which is set forth 

by GSA and provides the rules and requirements for performing services as a provider in CHAMP. 

(FAC ¶ 31.) 

Each participating TSP must submit either a domestic or international application 

worksheet form. (FAC ¶ 32.) Included in this form is the HTOS Questionnaire, which asks about 

provisions in the HTOS. (FAC ¶ 32.) In order to attain GSA International Approval, a TSP must 

file and attest to the answers contained in the HTOS Tender of Service Questionnaire. If shipping 

internationally, a TSP will have to answer the International HTOS Questionnaire. (FAC ¶ 32.) 

1. Request for Offers (“RFOs”) and the bidding process.

Every year, GSA issues a Request for Offers (“RFOs”) to all TSPs approved to participate 

in CHAMP. (FAC ¶ 33.) The RFOs solicit rate proposals from TSPs for both domestic and 

international shipping lanes. (FAC ¶ 33.) During subsequent bidding periods, TSPs may submit 

offers to provide household goods transportation services to federal civilian agencies. (FAC ¶ 33.) 

The rate offers are restricted to the GSA-approved scope of operation (e.g. only TSPs approved to 

participate in the international program can propose rates for international shipping lanes). (FAC

¶ 33.) Certain federal civilian agencies, including DOS, have additional reporting and shipping 

requirements for the transportation of employees’ household goods. (FAC ¶ 34.) These agencies 

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regularly work with GSA to promulgate Standing Route Orders (“SROs”), which outline the 

additional requirements. The SROs are then issued in conjunction with the annual RFO solicitation 

process. (FAC ¶ 34.) TSPs submitting offers for shipping lanes subject to SROs must abide by 

the requirements stated in both the RFO and SROs. (FAC ¶ 34.) 

Once a TSP has been federally approved for either international or domestic shipments by 

GSA to participate in CHAMP, the participating TSPs selected take full responsibility and agree 

to all federal rules and requirements outlined in the HTOS guidelines. (FAC ¶ 35.) Once the 

applicable bidding period closes, GSA evaluates the various rate offers, or bids, for each shipping 

lane and awards contracts to TSPs with the most competitive offers. (FAC ¶ 36.) TSP rate offers 

are evaluated and selected according to GSA’s Value Index (“VI”) system, which assesses offers 

based on the TSP’s prior service performance, as well the attractiveness of its proposed rates. 

(FAC ¶ 36.) To calculate prior service performance, GSA employs a Customer Satisfaction Index 

(“CSI”), which, using data from the previous twelve-month period, measures employee and agency 

satisfaction with a given TSP’s service in comparison to the average level of performance. (FAC

¶ 36.) If data is unavailable for a given TSP, that TSP will be considered unindexed and its prior 

service performance will not be a factor in the evaluation of its submitted rate offers. (FAC ¶ 36.) 

The TSP with the lowest applicable GSA tariff or tender is awarded a single factor rate (SFR), the 

rate used in computing the accepted transportation for the award. (FAC ¶ 37.) The TSP’s rate 

offer for the surface HHG is represented by a percentage as a single factor rate based on Base-Line 

Rates. (FAC ¶ 37.) 

2. Certified waivers for using foreign flag vessels

Among other RFO requirements, TSPs shipping goods internationally must use U.S. flag

vessels for the ocean portion of overseas shipments. (FAC ¶ 38.) If a U.S. flag vessel is not 

available to provide the required service, TSPs can request permission to use foreign flag vessels 

prior to shipment. (FAC ¶ 38.) To request permission, a TSP must submit to DOS a “Request for 

Approval of Use of a Foreign Flag Vessel.” (FAC ¶ 38.) It also must certify in writing that US 

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flag shipping is not available or that the use of the foreign flag shipping is necessary to meet 

delivery requirements. (FAC ¶¶ 38; see also ¶ 41 for examples of the waiver forms.) 

The use of U.S. flag vessels is more expensive than the use of foreign flag vessels. (FAC

¶ 39.) As a result, TSPs applying for waiver of the U.S. flag vessel requirement must also submit 

supporting documentation of any changes in the original proposed rate due to the use of foreign 

flag shipping. (FAC ¶ 39.) In the result of an increase or decrease of original rates awarded, a 

TSP is required to submit documentation of differences in rates between the foreign vessel rate 

and the rate originally awarded. (FAC ¶ 40.) 

3. U.S. General Services Administration’s Household Goods Tender of 

Services (“HTOS”)

Pursuant to statute and regulations, GSA oversees and sets forth the governing guidelines 

and regulations TSPs are subject to as CHAMP participants. (FAC ¶ 42.) GSA sets forth these 

guidelines pursuant to the U.S. General Services Administration’s Household Goods Tender of 

Service (“HTOS”). (FAC ¶ 42.) The HTOS provides that all participants in the program agree to 

be bound by the HTOS terms and conditions. (See FAC ¶ 43, HTOS, Aug. 2010 Ed.) 

The HTOS further provides, 

[t]he TSP shall use vessels of United States registry for the ocean portion of overseas 

shipments and book shipments for container or below deck stowage. However, when it is 

determined that the use of a vessel of United States registry will not provide the required 

service, the TSP shall request permission to use a Foreign Flag vessel prior to start of 

shipment.

Requests for permission to use a Foreign Flag vessel shall be made to RTO on the form 

‘Request for Approval of Use of a Foreign Flag Vessel’ (see Appendix C). Approval will 

be granted only when the TSP certifies in writing that US flag shipping is not available or 

the use of foreign flag shipping is necessary to meet delivery requirements.

(FAC ¶ 43, HTOS, Aug. 2010 Ed.)

Further, the HTOS provides detailed rate information relating to foreign flag vessels:

Adjustments in rates will be permitted when rate differentials are involved due to the use 

of Foreign Flag Shipping. A Justification Certificate (see Appendix C) is required for the 

use of a Foreign Flag vessel. When increases or decreases occur in rates due to the use of 

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Foreign Flag Shipping, billing and documentation submitted in connection with the GBL 

shipment will have differences between the Foreign Flag vessel rate and the rate used in 

computing the accepted transportation single factor rate (SFR). The ocean freight bill 

which must be submitted to support each GBL and the rate will be adjusted in favor of the 

TSP or the Government on the basis of this bill. 

(FAC ¶ 44.) 

Moreover, the International HTOS Questionnaire that all aspiring TSPs must complete 

which reemphasizes the importance of these requirements, asks the following questions:

33. When determined that the use of a vessel of the United States registry will 

not provide the required service, the participant will request permission to 

use foreign flag vessel prior to start of movement. (TRUE)

100. Adjustments in rates will not be permitted when rate differentials are 

involved due to the use of Foreign Flag Shipping. (FALSE) 

(FAC ¶ 45.)

B. The Scheme

1. Part One: The submission of the low-ball bids.

As explained above, twice a year, TSPs can submit bids through the RFO process for an 

award of different shipping lanes (e.g., D.C to China, Miami to the United Kingdom, etc.). (FAC

¶ 50.) DOS has 225 embassies and consulates worldwide, therefore, there are thousands of lanes 

at issue. One or more TSPs are awarded each lane. Once a lane award is secured through GSA, 

DOS managers arranging an employee move are required to use one of the TSPs that have been 

awarded the lane. (FAC ¶ 50.) The process is highly competitive and companies such as 

Defendants submit low-ball bids to capture the lane awards. (FAC ¶ 51.) In fact, the rates 

submitted by Defendants are so low they could only be cost-effective if they intend to unlawfully 

use cheaper foreign flag cargo vessels. (FAC ¶ 51.) Defendants have no intention of using the 

more expensive American carriers, knowing DOS will not audit the submissions. (FAC ¶ 51.) 

Defendants, through the rigged bids, are awarded the most lucrative lanes and lock out law-abiding 

competition. (FAC ¶ 51.)

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Examples of submissions by Defendants, including JK Moving, to obtain lane awards 

highlight low-ball bidding practices for what is known as the surface, or “ocean-going” portion of 

the shipment lanes from Washington D.C. to London. (See FAC ¶ 52.) The fair market rate of 

transport for that portion of the lane should have been approximately $7,200 at that time. (FAC ¶ 

52.) These fair market amounts are based on standard costs that all Defendants like JK Moving

would be subject to. (See FAC ¶ 52.) There is very little variability between TSPs as far as the 

costs that they must incur for such shipments. (FAC ¶ 52.) This is because most of the work of 

the shipment is done by other companies—i.e., subcontractors. (FAC ¶ 52.) Most notably, none 

of the TSPs have their own ocean shipping vessels, and therefore all must use the relatively small 

set of ocean shipping companies. Despite this standard cost range of $7,200 for the Washington 

D.C. to London surface or ocean-going portion of the lane, the companies submitted bids 

approximately 25% below those market rates. (FAC ¶ 53.) According to the GSA’s TMSS HHG 

query results run in March 2019, JK Moving charged $5,380.22, thus JK Moving would be 

entering into the transaction losing $1,819.78. (FAC ¶ 53.) 

2. Part Two: Submission of fraudulent flag waivers.

In order to profit on the low-ball bids, Defendants had to falsely certify the need to use 

foreign carriers, which are much cheaper, by submitting the required waiver form to DOS. 

Pursuant to the laws cited above, and the GSA contract, each TSP certifies that the waiver request 

is accurate and truthful as submitted. (FAC ¶ 70.) The guidelines and GSA contract make clear 

that foreign flag vessels are meant to be the rare exception to the rule requiring U.S. flag vessels. 

“Approval will be granted only when the TSP certifies in writing that a U.S. flag carrier is 

unavailable or the use of foreign flag shipping is necessary to meet delivery requirements.” (FAC

¶ 71.) Defendant JK Moving and others relied on DOS’s inability to audit these waivers so they 

could continue to use cheaper foreign vessels and secure lanes with low-ball bids. (FAC ¶ 72.) 

They knowingly submitted thousands of fraudulent waivers claiming U.S. flag vessels were not 

available, when in fact they were. (FAC ¶ 72.) As a result, law-abiding TSPs have been locked 

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out of shipping lanes and have been unable to compete with these companies’ unscrupulous 

practices. 

Further evidence shows that Defendants abandoned the scheme for fear of DOS uncovering 

the fraud. In 2018, Relator and others began raising concerns about the fraudulent practices. (FAC

¶ 73.) As a result, DOS began reemphasizing the U.S. flag requirements during industry 

conferences and through DOS publications. (FAC ¶ 73.) On March 27, 2019, DOS held a 

mandatory TSP meeting. Emanuel (Manny) Hazel was introduced as the Manager of Foreign Flag 

Waivers, a newly created position amidst the crackdown to show DOS’s recognition of the flagrant 

abuse of the CHAMP program through submission of fraudulent bids and waivers. (FAC ¶ 73.)

In response, some Defendants have recently stopped carrying out the scheme in fear of a 

crackdown. The chart included at paragraph 74 of the FAC shows this shift—where some 

Defendant companies barely broke-even or made a minor profit after switching to U.S. flag 

vessels. Other companies’ rates, including JK Moving, skyrocketed for fear of DOS uncovering 

the fraud and grew exponentially after the DOS meeting. (FAC ¶ 74.)

Communication between top executives further evidences the fraud. For example, in a late 

2019 meeting between Dawn Fontano of Crown Moving and Daniel Johnson, Director of 

Customer Service at Defendant Worldwide Moving & Storage, New World International Ltd.

Johnson admitted that New World had “lost a huge amount of money” since paring back their use 

of foreign flag vessels. Johnson admitted that abandoning the scheme impacted 40% of their 

international business. (FAC ¶ 79.) 

III. LEGAL STANDARD

A. The False Claims Act Must be Interpreted Liberally and Construed Broadly 

“The False Claims Act is intended to reach all types of fraud, without qualification, that 

might result in financial loss to the Government.... The Court has consistently refused to accept a 

rigid, restrictive reading.” U.S. ex rel. Sanchez v. Abuabara, No. 10-61673-CIV, 2012 WL 

254764, at *6 (S.D. Fla. Jan. 27, 2012) (citations and internal quotations omitted); see also United 

States v. AJB, No. CA 09-621-KDC, 2010 WL 3748249, *3 (S.D. Ala. Sept. 1, 2010), report and 

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recommendation adopted sub nom. United States v. AJB Liab. Co., No. CIV.A. 09-00621-KD-C 

(S.D. Ala. Sept. 17, 2010) (quoting United States ex rel. Loughren v. Unum Group, 613 F.3d 300 

(1st Cir. 2010) (“The FCA ‘covers all fraudulent attempts to cause the government to pay out sums 

of money.’”); S. REP. NO. 111–10, at 10 (2009) (noting that the FCA is “[o]ne of the most 

successful tools for combating waste and abuse in Government spending,” the “effectiveness” of 

which “has recently been undermined by court decisions limiting the scope of the law”). 

Indeed, the Act “has as its core function the promotion of transparency and honesty 

amongst government contractors.” United States v. Dynamics Research Corp., No. 03cv11965–

NG, 2008 WL 886035, at *8 (D. Mass., March 31, 2008). The goal of the FCA generally is to 

ensure integrity in government contracting, and the statute embodies “the maxim that [people] 

must turn square corners when they deal with the Government.” United States ex rel. Compton v. 

Midwest Specialties, Inc., 142 F.3d 296, 302 (6th Cir. 1989).

1. The Eleventh Circuit’sstandard for False Claims Act complaints under 

Rule 12 and Rule 9

The Eleventh Circuit has stated that Rule 9(b) serves an important purpose in fraud actions 

in part by alerting defendants to the precise misconduct with which they are charged. Ziemba v. 

Cascade Int'l., Inc., 256 F.3d 1194, 1202 (11th Cir. 2001). “The application of Rule 9(b), however, 

must not abrogate the concept of notice pleading.” Id. (citations omitted) (emphasis added); see 

also Randall v. Scott, 610 F.3d 701, 705 (11th Cir. 2010) (“To survive a Rule 12(b)(6) motion to 

dismiss, the complaint does not need detailed factual allegations ... but must give the defendant 

fair notice of what the plaintiff's claim is and the grounds upon which it rests.”). The “Court must 

not allow the application of Rule 9(b) to vitiate the overall concept of notice pleading.” Associated 

Indus. Ins. Co. v. Advanced Mgmt. Servs., Inc., No. 12-CV-80393-KAM, 2013 WL 1149668, *8

(S.D. Fla. Mar. 19, 2013) (citation omitted).

“The Eleventh Circuit evaluates ‘whether the allegations of a complaint contain sufficient 

indicia of reliability to satisfy Rule 9(b) on a case-by-case basis.’” U.S. ex rel. Mastej v. Health 

Mgmt. Assocs., Inc., 591 Fed. App’x. 693, 704 (11th Cir. 2014) (citations omitted). “Providing 

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exact billing data—name, date, amount, and services rendered-or attaching a representative sample 

claim is one way a complaint can establish the necessary indicia of reliability that a false claim 

was actually submitted. . . However, there is no per se rule that an FCA complaint must provide 

exact billing data or attach a representative sample claim.” Id. at 704 (emphasis added); see also 

Durham v. Bus. Mgmt. Assocs., 847 F.2d 1505, 1512 (11th Cir. 1988) (“Allegations of date, time 

or place satisfy the Rule 9(b) requirement that the circumstances of the alleged fraud must be 

pleaded with particularity, but alternative means are also available to satisfy the rule.”)

Indeed, the Rule 9(b) particularity requirement “must be read in conjunction with Federal 

Rule of Civil Procedure 8’s directives that a complaint need only provide a short and plain 

statement of the claim,” and courts considering motions to dismiss for failure to plead fraud with 

particularity “should always be careful to harmonize the directives of [R]ule 9(b) with the broader 

policy of notice pleading found in Rule 8.” Hill v. Morehouse Medical Associates, Inc., No. 02–

14429, 2003 WL 22019936, *3 (11th Cir. Aug. 15, 2003) (citations and internal quotation marks 

omitted). In other words, the two pleading standards are considered together, such that “[i]n an 

action under the False Claims Act, Rule 8’s pleading standard is supplemented but not supplanted

by Federal Rule of Civil Procedure 9(b).” Urquilla-Diaz v. Kaplan University, 780 F.3d 1039, 

1051 (11th Cir. 2015) (emphasis added). 

Further, the Supreme Court has made clear that a complaint need only allege “enough facts 

to state a claim to relief that is plausible on its face,” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 

570 (2007), or allege sufficient facts to “raise a right to relief above the speculative level.” Id. at 

555. “The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than 

a sheer possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 672, 678 

(2009) (quoting Twombly).1

 

1 Other circuits also have made clear the trend that the pleading standard for FCA cases must be 

liberal. “If there are two alternative explanations, one advanced by defendant and the other 

advanced by Relator, both of which are plausible, Relator’s complaint survives a motion to 

dismiss under Rule 12(b)(6).” Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011), cert. denied, 

132 S. Ct. 2101 (2012). Accordingly, a relator “need not rule out all possible innocent 

explanations.” In re Automotive Parts Antitrust Litigation, 2014 WL 840272 (E.D. Mich. 2014). 

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IV. ARGUMENT 

A. Relator Pleads Fraud with the Required Particularity

As stated above in Section III, the Eleventh Circuit has reiterated that while FCA cases 

must be pled with particularity, there is not an exact formula for what must be pled in each case. 

See, e.g., Randall v. Scott, 610 F.3d 701, 705 (11th Cir. 2010) (“To survive a Rule 12(b)(6) motion 

to dismiss, the complaint does not need detailed factual allegations ... but must give the defendant 

fair notice of what the plaintiff's claim is and the grounds upon which it rests.”); United States ex 

rel. Clausen v. Lab. Corp. of Am., Inc., 290 F.3d 1301, 1308–09, 1312 n.21 (11th Cir. 2002)

(providing examples of the types of information that might help a plaintiff plead the submission 

of a claim with particularity, yet cautioning that Rule 9(b) “does not mandate all of this information 

for any of the alleged claims.”) 

1. The “Who” and “What” Has Been Properly Pled

Relator has sufficiently pled “who” made the claims—multiple corporate defendants, 

including JK Moving, submitted or presented the false claims through the GSA. 

Relator has also adequately alleged “what” occurred. As provided above in Section III, 

“[t]he Eleventh Circuit evaluates ‘whether the allegations of a complaint contain sufficient indicia 

of reliability to satisfy Rule 9(b) on a case-by-case basis.’” Mastej, 591 Fed. App’x. at 704 

(citations omitted). 

Indeed, “[p]roviding exact billing data—name, date, amount, and services rendered-or 

attaching a representative sample claim is one way a complaint can establish the necessary indicia 

For example, in United States ex rel. Grubbs v. Kanneganti, 565 F.3d 180, 190 (5th Cir. 2009), 

the Fifth Circuit held that “[t]he particular circumstances constituting the fraudulent presentment 

are often harbored in the scheme . . .” and the details of a scheme to submit false claims “paired 

with reliable indicia that lead to a strong inference that claims were actually submitted” are 

sufficient for stating an FCA claim. Other circuits have followed suit. See, e.g., Ebeid v.

Lungwitz, 616 F.3d 993 (9th Cir. 2010) (“We do not embrace the district court’s categorical 

approach that would, as a matter of course, require a relator to identify representative examples 

of false claims to support every allegation . . . . [I]t is sufficient to allege particular details of a 

scheme to submit false claims paired with reliable indicia that lead to a strong inference that 

claims were actually submitted.”)

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of reliability that a false claim was actually submitted.” Id. “However, there is no per se rule that 

an FCA complaint must provide exact billing data or attach a representative sample claim.” Id.; 

see also Clausen, 290 F.3d at 1312 & n.21 (listing some of the types of information that might 

help a plaintiff plead the submission of a claim with particularity but cautioning that Rule 9(b) 

“does not mandate all of this information for any of the alleged claims”); Durham v. Bus. Mgmt. 

Assocs., 847 F.2d 1505, 1512 (11th Cir. 1988) (“Allegations of date, time or place satisfy the Rule 

9(b) requirement that the circumstances of the alleged fraud must be pleaded with particularity, 

but alternative means are also available to satisfy the rule.”); U.S. ex rel. Lockhart v. Gen. 

Dynamics Corp., 529 F. Supp. 2d 1335, 1341 (N.D. Fla. 2007) (“[O]ne cannot give the date of an 

event that did not happen, or identify the person who made a disclosure that was not made. The 

complaint specifically identifies the tests that were not conducted, and gives precise and credible 

information on how [Relator] knows what he alleges. This is sufficient to satisfy Rule 9(b).”)

Under the Eleventh Circuit’s nuanced, case-by-case approach, other means are available to 

present the required indicia of reliability that a false claim was submitted. “Although there are no 

bright-line rules, our case law has indicated that a relator with direct, first-hand knowledge of the 

defendants’ submission of false claims gained through her employment with the defendants may 

have a sufficient basis for asserting that the defendants actually submitted false claims.” Mastej, 

591 F. App'x at 704–05; see also U.S. ex rel. Walker v. R & F Properties of Lake County, Inc., 433 

F.3d 1349, 1360 (11th Cir.2005) (holding that Rule 9(b) was satisfied where the relator was a nurse 

practitioner in the defendant’s employ whose conversations about the defendant’s billing practices 

with the defendant’s office manager formed the basis for the relator’s belief that claims were 

actually submitted to the government).

As detailed above in Section II, Relator has provided detailed descriptions of the explicit 

contractual and legal mandates at issue, examples of what items were submitted, and the scheme 

behind the submissions. 

Further, JK Moving misses the mark in relying upon a series of “underbidding” cases. (See 

Motion to Dismiss, ECF No. 150 at 12-13.) This case is not premised only upon submission of a 

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rate, but rather, improper certification of unavailability of U.S. carriers in securing government 

contracts—a material condition of awarding contracts and receiving payment from the DOS

through the CHAMP program. The low-rate submissions evidence part of the scheme as outlined 

above, but unlike the cases JK Moving relies upon, this case is not about the bids alone. As 

explained further below in Section IV, C, these certifications of unavailability were material to the 

government awarding contracts and issuing payment to the TSPs. Similarly, JK Moving’s 

argument that this is a case of “inducement” (see ECF No. 150 at 12), is similarly misplaced 

because JK Moving fails to address the fraudulent certifications. 

2. The “How” Has Been Properly Alleged

As detailed in Section II above, the clear rules of the DOS (and GSA) have been violated. 

These rules are based on the “America-First” policy and nearly a century of maritime policy and 

regulation. The Merchant Marine Act of 1936 provides the GSA authority to set forth regulations 

requiring agencies not to pay or reimburse an officer or employee for travel or transportation 

expenses associated with a foreign vessel, unless documentation indicates the necessity to do so. 

(See 46 U.S.C. § 55302(b); see also FAC ¶ 25.) The Cargo Preference Act of 1954 requires that: 

“at least 50 percent of the gross tonnage of all Government generated cargo -- meaning cargoes 

procured, furnished, or financed by the United States Government -- shall be transported on 

privately owned, U.S.-flag commercial vessels to the extent such vessels are available at fair and

reasonable rates. The ‘at least 50 percent’ requirement is applicable to the extent such vessels are 

available at fair and reasonable rates, as determined by the Maritime Administration.” (The Cargo 

Preference Act of 1954 refers to Section 901(b) of the Merchant Marine Act of 1936, as amended 

in 46 U.S.C. § 1241(b), and codified in various subsequent documents 46 USC § 55305; 46 C.F.R. 

Part 381; see also FAC ¶ 26.) Indeed, the CHAMP Program includes cargos that are subject to the 

Cargo Preference Act pursuant to 46 C.F.R. Part 381.2(b)(1), and (4). The Cargo Preference Act 

of 1954 is applied to and administered by all Federal departments and agencies (except the 

Department of Defense). See 46 C.F.R. Part 381.3. (FAC ¶ 27.)

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 14 of 22
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Further, the Code of Federal Regulations clearly states that the preference for privately 

owned U.S. Flag vessels applies to contractors and subcontractors working with the U.S. 

government. (See 48 C.F.R. Part 47.503(a)(1); FAC ¶ 28.) Accordingly, specific federal 

regulations and laws have been violated by Defendants, establishing the “how.” 

3. The “When” and “Where” are Properly Pled

The “when” has been specified between approximately 2008-2018. The “where” pertains 

to the international routes of Defendants, including JK Moving as outlined above in Section II. 

B. The Complaint Pleads the Requisite Element of Scienter 

Rule 9 on its face does not apply to the scienter requirement of the False Claims Act. See

Rule 9(b) (“Malice, intent, knowledge, and other conditions of a person’s mind may be alleged 

generally”); see also United States ex rel. Dildine v. Pandya, 389 F. Supp. 3d 1214, 1218 (N.D. 

Ga. 2019). The False Claims Act defines “knowingly” as having “actual knowledge of the 

information,” acting “in deliberate ignorance of the truth or falsity of the information,” or acting 

“in reckless disregard of the truth or falsity of the information.” 31 U.S.C. § 3729(b)(1)(A). The 

FAC alleges far more than recklessness and deliberate ignorance.

As summarized above, “the Supreme Court has made clear that a complaint need only 

allege “enough facts to state a claim to relief that is plausible on its face,” Twombly, 550 U.S. at

570, or allege sufficient facts to “raise a right to relief above the speculative level.” Id. at 555. 

“The plausibility standard is not akin to a ‘probability requirement,’ but it asks for more than a 

sheer possibility that a defendant has acted unlawfully.” Iqbal, 556 U.S. at 678 (quoting Twombly). 

Here, Relator has plausibly alleged JK Moving knowingly submitted false claims.

C. Relator Has Sufficiently Alleged Materiality

JK Moving believes because the Government was not charged extra in using foreign 

transportation providers, that it has not been damaged. (See ECF No. 150 at 12.) JK Moving is 

mistaken and misunderstands materiality and damages under the FCA. 

“A misrepresentation about compliance with a statutory, regulatory, or contractual 

requirement must be material to the Government's payment decision in order to be actionable under 

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 15 of 22
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the [FCA].” Universal Health Servs., Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989, 2002 

(2016). Further, an alleged violation of an important statute generally does not require further 

facts to establish materiality. See, e.g., United States ex rel. Heller v. Guardian Pharmacy, LLC, 

No. 1:18-CV-03728-SDG, 2021 WL 488305, at *16 (N.D. Ga. Feb. 10, 2021) (“In sum, the Court 

agrees with the position taken by the majority of courts to reach the issue and finds that Heller 

need not allege further facts to establish materiality beyond a facially plausible violation of the 

AKS.”)

As outlined above in Sections II.A.3 and IV.A.2, the “America-First” policy is 

longstanding, is codified in the statutes and regulations cited above, and noted in every contract 

for transport at issue in this case by the DOS And GSA. Further highlighting the mandate to use 

American vessels absent unavailability, there are significant penalties in place for TSPs when 

submitting bids and waivers, in addition to FCA liability. (FAC ¶ 46.) “An applicant shall submit 

an application in its own name for approval as a TSP. A firm that on its own behalf or on behalf 

of an agent (a) falsifies, conceals, or covers up by any trick, scheme, or device a material fact; (b) 

makes any false, fictitious or fraudulent statement or representation; or (c) makes or uses any false 

writing or document knowing the same to contain any false, fictitious or fraudulent statement or 

entry on any part of the application or on any document furnished pursuant to this HTOS is 

punishable by fines, imprisonment, or both.” 18 U.S.C. § 1001; see also HTOS, Aug. 2010 Ed. § 

2.7.

Thus, the question is whether had the Government known about the false certification, 

could it have influenced its decision to award the contracts or pay the TSPs—not whether the 

Government paid less for that particular lane. To obtain a contract with DOS, using an American 

vessel (absent true unavailability), is a strict requirement to further the America-First policy, and 

provide employment opportunities, tax revenue and other benefits to the United States and 

United States vessels. Accordingly, the allegations against JK Moving and other Defendants are 

plainly material violations, resulting in significant damages. 

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 16 of 22
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D. The Public Disclosure Bar is Not Applicable 

1. Background

Despite its short-hand name, the FCA’s public disclosure bar is not triggered by any public 

disclosure of any generalized information about potential violations of law. Even when the bar is 

implicated, an “original source” exception permits whistleblowers (like Relator) with significant 

information obtained independently of the relevant publicly disclosed information to proceed, 

because they “may still bring something of value to the table and thus deserve[] to benefit.” United 

States ex rel. Colquitt v. Abbott Lab’ys, 858 F.3d 365, 373 (5th Cir. 2017). 

The channels that trigger the public disclosure bar are very specific; the bar applies only:

if substantially the same allegations or transactions as alleged in the action or claim

were publicly disclosed—

(i) in a Federal criminal, civil, or administrative hearing in which

the Government or its agent is a party;

(ii) in a congressional Governmental Accountability Office, or other

Federal report, audit, or investigation; or

(iii) from the news media,

unless . . . the person bringing the action is an original source of the information. 

31 U.S.C. § 3730(e)(4)(A).

2. No Relevant Public Disclosure Has Occurred

A disclosure occurs where (1) the disclosure at issue occurred through one of the channels 

specified in the statute as outlined above; (2) the disclosure was “public”; and (3) the disclosure 

involves substantially the same allegations or transactions as alleged in the action or claim. See

31 U.S.C. § 3730(e)(4). Here, none of the requirements can be met. 

JK Moving cites cases relating to public “reports” to support its argument that the TMSS 

2.0 portal falls under the public disclosure bar. However, the cases are inapposite. First, the system 

is a cloud-based application specifically engineered to help customers meet transportation needs 

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 17 of 22
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as an advanced management tool. The portal in fact states, “[t]his is a U.S. General Services 

Administration Federal Government computer system that is ‘FOR OFFICIAL USE ONLY.’” 

(emphasis in original) Therefore, the portal is not a “report” as contemplated by the public 

disclosure bar. Moreover, fatal to JK Moving’s argument, unlike the cases cited, the GSA TMSS 

2.0 system is not accessible to the public. The Portal requires login credentials and is designed for 

CHAMP participants. Finally, the FAC references the portal to highlight the bid submissions; but 

using the portal to highlight a part of the scheme does not qualify as the same “allegations or 

transactions” in the complaint. JK Moving’s systematic submission of false foreign flag waiver 

certifications has not been made public or quasi-public in any manner.

Accordingly, JK Moving has not identified a qualifying “public disclosure,” and the 

“original source” inquiry is therefore irrelevant.2 

2 After the 2010 amendments, the Eleventh Circuit, along with other circuits, held the bar is no 

longer jurisdictional. United States ex rel. Osheroff v. Humana Inc., 776 F.3d 805, 810 (11th Cir. 

2015) (“We conclude that the amended § 3730(e)(4) creates grounds for dismissal for failure to 

state a claim rather than for lack of jurisdiction. The plain language of the new provision 

commands this interpretation: it instructs courts to dismiss an action when the public disclosure 

provision applies.”) Accordingly, challenges based on the post-2010 provision should be 

evaluated under the highly deferential standards of Rule 12(b)(6). United States ex rel. Moore & 

Co. v. Majestic Blue Fisheries, LLC, 812 F.3d 294, 300 (3rd Cir. 2016) (reversing district court 

which should have decided public disclosure bar motion under Rule 12(b)(6)). 

The 2010 amendments also materially changed the original source definition. Previously, a relator 

needed “direct and independent knowledge of the information on which the allegations are based.” 

31 U.S.C. § 3730(e)(4) (1986). Congress removed the “direct” knowledge requirement, and the 

statute now requires only “knowledge that is independent of and materially adds to the publicly 

disclosed allegations or transactions.” Id. § 3730(e)(4)(B) (2010). Additionally, post-amendment 

the bar only applies to “federal” court or administrative proceedings. See Osheroff, 776 F.3d at 

812. Here, neither version of the public disclosure bar is applicable. In any event, even if somehow 

JK Moving could argue the GSA website portal could qualify as a public disclosure, Relator is an 

original source as an insider in the industry with details relating to the schemes of fraudulent 

submissions. Similarly, JK Moving argues that Relator is not an employee, but a likely competitor, 

and thus is not an “insider.” However, JK Moving has cited no authority to support this theory

and fails to acknowledge an employee of a TSP has unique knowledge and access to information 

in the industry, and specifically related to other TSPs. 

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 18 of 22
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V. CONCLUSION 

For the foregoing reasons, Relator respectfully requests the Court deny JK Moving’s 

Motion to Dismiss, or alternatively, grant leave to amend. 

Dated: August 27, 2021 Respectfully submitted,

 /s Ryon M. McCabe

Ryon McCabe (FL 009075)

rmccabe@mccaberabin.com

MCCABE RABIN, P.A.

1601 Forum Pl #201

West Palm Beach, FL 33401

Telephone (561) 659-7878

COTCHETT, PITRE & MCCARTHY, LLP

Justin T. Berger (admitted pro hac vice)

Sarvenaz J. Fahimi (admitted pro hac vice)

San Francisco Airport Office Center

840 Malcolm Road

Burlingame, CA 94010

LAW OFFICES OF PAUL PELLETIER

Paul E. Pelletier (admitted pro hac vice)

3500 Morningside Drive

Fairfax, VA 22031

Attorneys for Relator Sedona Partners LLC 

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 19 of 22
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CERTIFICATE OF SERVICE

I HEREBY CERTIFY that on August 27, 2021 I electronically filed the foregoing 

document with the Clerk of the Court using CM/ECF. I also certify that the foregoing document 

is being served this day on all counsel of record or pro se parties identified on the attached Service 

List in the manner specified, either via transmission of a Notice of Electronic Filing generated by 

CM/ECF or in some other authorized manner for those counsel or parties who are not authorized 

to receive electronically Notices of Electronic Filing.

 /s Ryon M. McCabe

Ryon McCabe (FL 009075)

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 20 of 22
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SERVICE LIST

UNITED STATES OF AMERICA ex rel. SEDONA PARTNERS LLC,

v.

ABLE MOVING & STORAGE, INC., et al.

Case No. 20-CV-23242-BLOOM/Louis

U.S. District Court, Southern District of Florida

James A. Weinkle

Assistant United States Attorney

Office of the United States Attorney

Southern District of Florida

99 N.E. 4th Street, Suite 300

Miami, Florida 33132

James.Weinkle@usdoj.gov

Counsel for United States of America

Robert Harris

rharris@stackfernandez.com

gmartich@stackfernandez.com

Sammy Epelbaum

sepelbaum@stackfernandez.com

Stack Fernandez & Harris, PA

1001 Brickell Bay Drive, Ste. 2650

Miami, FL 33131

Counsel for Paxton Van Lines, Inc.

Stuart A. Berman

saberman@lerchearly.com

Lerch, Early & Brewer, Chtd.

7600 Wisconsin Avenue, Ste. 700

Bethesda, MD 20814

301.657.0729

Pro Hac Vice Paxton Van Lines, Inc.

Christopher W. Wadsworth,

cw@wmd-law.org

pleadings@wmd-law.org

Wadsworth, Margrey & Dixon, LLP

261 NE 1st Street, 5th Fl.

Miami, FL 33132

305.777.1000

Counsel Able Moving & Storage, Inc.

Matthew J. Landley

mlangley@beneschlaw.com

Benesch, Friedlander, Coplan & Aranoff, 

LLP

71 South Wacker Drive, Ste. 1600

Chicago, IL 60606-4637

312.212.4949

Counsel for DeWitt Companies Limited, LLC

Stephen Chahn Lee

slee@beneschlaw.com

Benesch, Friedlander, Coplan & Aronoff, 

LLP

71 S. Wacker Drive, Ste. 1600

Chicago, IL 60606

312.624.6361

Pro Hac Vice DeWitt Companies Limited, 

LLC

Michael B. Silverstein

msilverstein@beneschlaw.com

Benesch, Friedlander, Coplan & Aronoff, 

LLP

41 South High Street, Ste. 2600

Columbus, OH 43215

614.223.9362

Pro Hac Vice DeWitt Companies Limited, 

LLC

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 21 of 22
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Barry A. Postman

Barry.postman@csklegal.com

Sara.ghent@csklegal.com

Justin C. Sorel

Justin.sorel@csklegal.com

Loren.ryan@csklegal.com

Cole, Scott & Kissane, P.A.

222 Lakeview Avenue, Ste. 120

West Palm Beach, FL 33401

Counsel for Hilldrup Companies, Inc.

Maura K. Monaghan

mkmonaghan@debevoise.com

Melanie M. Burke

mburke@debevoise.com

Kristin D. Kiehn

kdkiehn@debevoise.com

Debevoise & Plimpton LLP

919 Third Ave.

New York, NY 10022

Pro Hac Vice Hilldrup Companies, Inc.

R. Eric Bilik

ebilik@mcguirewoods.com

Sean P. Walsh

swalsh@mcguirewoods.com

McGuire Woods, LLP

50 North Laura Street, Ste. 3300

Jacksonville, FL 32202-3661

904.798.3200

Counsel for J.K. Moving & Storage, Inc.

Andrew M. Gordon

agordon@hinshawlaw.com

Hinshaw & Culbertson, LLP

One East Broward Blvd., Ste. 1010

Ft. Lauderdale, FL 33301

954.467.7900

Counsel for New World Van Lines, Inc.

Brian R. Zeeck

bzeeck@hinshawlaw.com

Hinshaw & Culbertson, LLP

151 North Franklin Street, Ste. 2500

Chicago, IL 60606

312.704.3028

Pro Hac Vice New World Van Lines, Inc.

Craig B. Shapiro

cshapiro@belaw.cc

Buchbinder & Elegant, P.A.

46 S.W. 1st Street, 4th Fl.

Miami, FL 33130

305.358.1515

Counsel for Western Express Forwarding, 

LLC

Thomas F. Murphy tmurphy@dclawfirm.com

Friedlander Misler, PLLC

5335 Wisconsin Avenue, NW

Ste. 660

Washington, DC 20015

202.872.080

Pro Hac Vice Western Express Forwarding, 

LLC

Case 1:20-cv-23242-BB Document 170 Entered on FLSD Docket 08/27/2021 Page 22 of 22