Court Opinion

ID: 8423438
Source: CourtListenerOpinion
Date Created: 2022-11-03 23:36:59.164435+00
Date Added: 2024-06-11T16:48:27.432424
License: Public Domain

BRISCOE, Circuit Judge,
dissenting.
I respectfully dissent. In my view, the district court’s factual findings on remand reinforce the unmistakable conclusion that Stone cannot establish that he qualifies as an “original source” under 31 U.S.C. § 3730(e)(4)(B). I therefore again conclude that Stone’s claims should be dismissed for lack of subject matter jurisdiction.
As “the party invoking federal jurisdiction,” Stone bore “the burden of alleging *712facts essential to show jurisdiction under the False Claims Act [FCA].” United States ex rel. Holmes v. Consumer Ins. Group, 318 F.3d 1199, 1202 (10th Cir.2003) (en banc) (internal quotations omitted). Because his claims under the FCA were based on publicly disclosed information, in order to establish subject matter jurisdiction, Stone was required to prove he was “an original source of th[at] information.” 31 U.S.C. § 3730(e)(4)(A). To do so, Stone first had to prove he “ha[d] direct and independent knowledge of the information on which [his] allegations [we]re based.” 31 U.S.C. § 3730(e)(4)(B). In other words, Stone had to prove he had direct and independent knowledge of “any essential element of the [underlying] fraud transaction.” United States ex rel. King v. Hillcrest Health Ctr., Inc., 264 F.3d 1271, 1280 (10th Cir.2001) (internal emphasis and quotation omitted). Stone also had to prove he “voluntarily provided the information to the Government” before filing his qui tam action. 31 U.S.C. § 3730(e)(4)(B).
Count One of the amended complaint, asserted jointly by the United States and Stone, alleged generally that Rockwell violated the FCA by “knowingly presenting or causing to be presented to the government false or fraudulent claims for money or property.” App. at 995. In particular, Count One alleged that, during the course of ten six-month contract award periods (running from October 1, 1986, through December 30, 1989), Rockwell concealed from the DOE environmental, safety, and health problems related to the processing and storage of pondcrete and saltcrete. At trial, the jury found Rockwell had violated the FCA during three of the contract award periods at issue and awarded $1,390,775.80 in damages (an amount equal to ten percent of the total fee award bonuses received by Rockwell during the three contract award periods).
In my dissent to the original panel opinion, I outlined why Stone had failed to establish he was an “original source” with respect to these prevailing FCA claims. In short, I concluded that although Stone had accurately predicted in a 1982 “Engineering Order” written during the course of his employment that Rockwell’s proposed design for making pondcrete would not work, App. at 439, there was no evidence that he directly and independently knew that Rockwell actually experienced problems when it began producing pondcrete or that Rockwell concealed the resulting environmental problems from the DOE. Not only did Stone’s employment with Rockwell end well before either event occurred, his Engineering Order addressed neither the failure of pondcrete when it was later produced nor Rockwell’s concealment of that failure from the DOE. The Engineering Order did not address these points for the simple reason it could not address events that had not yet occurred.
Although the district court’s task on remand was focused solely on determining whether Stone had satisfied the “disclosure” component of the “original source” rule, its findings reinforce the conclusions I reached in my original dissent. Specifically, the district court found that, prior to filing suit, the only information possessed by Stone and provided to the government concerning pondcrete was the 1982 Engineering Order in which Stone opined that the company’s proposed design for making pondcrete was flawed. The majority concludes disclosure of the Engineering Order to the government satisfies the “disclosure” component of the “original source” rule. I disagree. Because the Engineering Order only conveyed Stone’s professional opinion that the proposed pondcrete design would not work, the fact that he provided a copy of the Engineering Order *713to the government in March 1988 did not satisfy the “disclosure” component of the § 8730(e)(4)(B) “original source” rule. Aside from providing the Engineering Order to the government, there is no evidence that, prior to suit, Stone informed the government, or was even aware, that Rockwell actually experienced problems with its pondcrete production and concealed such problems from the DOE. Thus, Stone cannot qualify as an “original source” and his FCA claims should be dismissed for lack of subject matter jurisdiction.