Opinion ID: 2669594
Heading Depth: 2
Heading Rank: 1

Heading: Verizon I

Text: On January 16, 2007, Stephen M. Shea filed a complaint on behalf of the United States government against Verizon (Verizon I) under the qui tam provisions of the FCA, 31 U.S.C. §§ 3729–3732. The FCA authorizes private parties (“relators”) to bring false claims actions in the name of the United States, and to recover a portion of the proceeds of the action if successful. See id. § 3730(b), (d). Shea’s 2007 complaint alleged the submission of false claims by Verizon. More specifically, the complaint contained the following allegations: (1) that Verizon made “knowing submission to the United States of certain prohibited surcharges 3 under contracts to provide telecommunications services” to the General Services Administration (“GSA”); (2) that Shea is a telecommunications consultant; (3) that Shea based his allegations on experience with Verizon’s alleged practice of “billing corporate clients not only for federal, state and local taxes levied on the customer but also for surcharges (often labeled as, or lumped together with, taxes) that were added to bills . . . to inflate . . . revenue,” 2007 Complaint ¶¶ 2, 12; (4) that Verizon used “the same billing platform” for both business customers and the United States, 2007 Complaint ¶¶ 6, 81; (5) that through this practice, Verizon charged the government “Federal, State, and local taxes and duties” contrary to Federal Acquisition Regulations (“FAR”), FAR 52.229-4(b), 48 C.F.R. 52.229–4(b), 2007 Complaint ¶ 20; and (6) that Shea became aware of the alleged conduct through an internal document he received in 2004 which listed “the taxes and surcharges that the Federal Government is responsible for.” 2007 Complaint ¶ 70. The United States intervened in Verizon I, and in February 2011, the parties settled the case without admission of liability. Shea received nearly $20 million for his role in the litigation.