Court Opinion

ID: 4088630
Source: CourtListenerOpinion
Date Created: 2016-10-11 21:01:01.097095+00
Date Added: 2024-06-11T14:50:38.242034
License: Public Domain

In the

    United States Court of Appeals
                 For the Seventh Circuit
                       ____________________
No. 14-2815
UNITED STATES ex rel. ERIC UHLIG,
                                                  Plaintiff-Appellant,

                                 v.

FLUOR CORP., et al.,
                                               Defendants-Appellees.
                       ____________________

         Appeal from the United States District Court for the
                     Central District of Illinois.
           No. 4:11-cv-04009 — Michael M. Mihm, Judge.
                       ____________________

  ARGUED SEPTEMBER 8, 2016 — DECIDED OCTOBER 11, 2016
                ____________________

   Before FLAUM, ROVNER, and SYKES, Circuit Judges.
   FLAUM, Circuit Judge. Eric Uhlig brought False Claims Act
and retaliation claims against his former employer, Fluor Cor-
poration, and related entities (collectively, “Fluor”). Fluor
contracted with the United States Army to provide, among
other services, electrical engineering work in Afghanistan.
   Uhlig says Fluor violated the False Claims Act when it
knowingly breached the terms of its Army contract by using
2                                                 No. 14-2815

unlicensed electricians as journeymen and billing the govern-
ment for the services. Uhlig also contends Fluor wrongfully
terminated Uhlig as a whistleblower in violation of 31
U.S.C. § 3730(h).
  The district court granted summary judgment for Fluor.
We affirm.
                         I. Background
    The United States Army uses umbrella agreements known
as “indefinite delivery, indefinite quantity” (“IDIQ”) con-
tracts with private companies to provide support for military
personnel. IDIQ contracts provide the general terms under
which a contractor is to work but do not delineate specific
conditions. The Army then uses “Task Orders” to assign jobs
to a contractor.
    In 2007, the Army and Fluor entered into an IDIQ contract
known as Logistics Civil Augmentation Program IV
(“LOGCAP IV”). LOGCAP IV provided a framework for con-
struction, maintenance, and other services in support of mili-
tary personnel around the world.
    LOGCAP IV originally contained no specific provisions
governing personnel qualifications. In August 2008, the Army
issued LOGCAP IV Contract Modification 4, which provided:
      The Contractor shall ensure that Contractor per-
      sonnel … possess a license, certification, train-
      ing, and/or education commensurate with the
      level of duties to which they are assigned.
      … Contractor will comply with the terms of this
      provision if Contractor develops and reasona-
No. 14-2815                                                   3

       bly implements a Trades Certification and Vali-
       dation Plan, as approved by the Government,
       utilizing the master, journeyman, or apprentice
       model.
    Fluor submitted a Trades Certification and Validation Plan
as required by Modification 4. The Plan divided craft workers
into four categories using “a combination of licenses held, ed-
ucation, training, and experience.”
    The Plan defined a “helper” as an apprentice who works
under constant supervision and a “journeyman” as a skilled
craftsperson who may work with minimal supervision and
possesses “verifiable minimum experience and/or holds a
universally accepted certification, license and/or degree.” The
Plan also stated that electricians “[m]ay be required to hold a
license.”
   In January 2009, the government approved the Plan, mak-
ing it the contractual standard by which Fluor employees’
qualifications were to be established.
    In July 2009, Fluor was awarded Task Order 5, which au-
thorized Fluor to perform a variety of services, including elec-
trical work, at military bases in northern Afghanistan. Before
Fluor, a different contractor, KBR, Inc., had been performing
this work. To avoid major disruptions in service, the govern-
ment requested that Fluor attempt to hire KBR employees
who were already in Afghanistan. Fluor hired American and
British former KBR employees, as well as employees from
Bosnia, Macedonia, India, and Pakistan. The employees who
were not citizens of the United States or Great Britain were
referred to as “other-country nationals.”
4                                                        No. 14-2815

   Uhlig was one of the KBR employees that Fluor hired.
Fluor gave Uhlig a one-year foreperson1 position starting Jan-
uary 23, 2010.
    In early 2010, Fluor reviewed its procedures for establish-
ing journeyman electricians’ qualifications and decided to re-
quire that these electricians hold a state-issued United States
license or a Great Britain-issued license. Fluor says that it im-
posed this requirement not because it was obligated to do so
under Modification 4, but rather because it wanted to stream-
line its qualification process and promote uniformity.
    Uhlig had graduated from an apprenticeship program but
did not have an electrician’s license because his home state of
Missouri—like several other states—did not issue electrician’s
licenses.
    By mid-2010, Fluor had implemented its licensing require-
ment for journeyman electricians being hired in the United
States for deployment to Afghanistan. However, the situation
was more complicated for electricians like Uhlig, who had al-
ready been hired in Afghanistan as “foremen” but lacked
state-issued electrician’s licenses. No one disputed that the
unlicensed foremen were qualified to do journeyman work;
nevertheless, Fluor decided to apply its licensing requirement
to existing employees.
   On November 16, 2010, Fluor emailed its foremen working
under Task Order 5, including Uhlig, explaining that licensed

    1 At KBR, Uhlig and other workers were “journeymen.” Uhlig and
other KBR journeymen were hired by Fluor as “foremen” because Fluor
did not yet have a job classification named “journeymen,” though KBR’s
pay scale for journeymen matched Fluor’s pay scale for its foremen.
No. 14-2815                                                   5

foremen would be reclassified as “journeymen” and unli-
censed foremen would be reclassified as “helpers.” Fluor
stated that this change was meant to “bring Fluor into better
alignment with our contractual requirements.” Accordingly,
of the hundreds of Fluor electricians working under Task Or-
der 5, approximately thirty-one, including Uhlig, became
“helpers.” The others simply changed titles from “foremen”
to “journeymen.”
     Other-country nationals were not eligible for licensing by
a state in the United States. Thus, under Fluor’s self-imposed
licensing procedure, all such employees became helpers, even
if, by virtue of their education and experience, they were qual-
ified to perform journeyman work. However, Fluor did not
plan to terminate unlicensed other-country nationals in the
same way Fluor terminated Uhlig. Fluor says that it was more
affordable to retain those employees as helpers because they
did not get the same overseas benefits as American helpers.
   On November 17, 2010, Fluor offered Uhlig an additional
year’s employment. However, on November 19 Fluor in-
formed Uhlig that because he did not have a license, he was
being reclassified as a helper. Fluor further informed Uhlig
that unless he obtained a license before January 23, 2011, the
end of his one-year employment, he would be terminated.
    Unfortunately for Uhlig, he was out of vacation days and
had no opportunity to return to the United States to get an
electrician’s license by January 2011. Uhlig asked human-re-
sources supervisor Thomas Rizzo for help, but Fluor would
not change its position. Uhlig was upset that he would be ter-
minated while the unlicensed other-country nationals—also
now all helpers—would stay on.
6                                                             No. 14-2815

    Uhlig says that after imposing the licensing requirement,
Fluor directed helpers to perform unsupervised journeyman
work. Uhlig was particularly frustrated after one assignment
at a camp called “NKC” and sent an email to Rizzo and De-
fense Contract Management Agency officer Billy Porter. In it,
Uhlig said he was given an assignment he did not think he
should be given as an unlicensed helper. Uhlig further stated:
“I am a U[S] tax payer losing my job at the end of January
because … this company is using my US tax dollars having
OCN/A[fg]hans [as] unlicensed electricians going against
government compliance.” Uhlig had not read Modification 4
or the language of the Trades Certification and Validation
Plan at that point.
   Rizzo asked Uhlig why he had contacted the government
directly instead of pursuing available channels through Fluor.
Uhlig responded in a December 4, 2010 email: “I am just fol-
lowing a US taxpayer’s obligation to report fraud waste and
abuse from stiffing the US government.” Uhlig again copied
Porter on the email, but also sent the email to
mdoyle@doyleraizner.com, stating that Mr. Doyle was his at-
torney, and to mssparky@mssparky.com. Ms. Sparky was a
website hosted by a former KBR employee, the stated purpose
of which was “exposing … corporate greed among [defense]
contractors.” Uhlig admits that when he sent the email, he
had neither retained Doyle as his attorney nor previously
been in contact with him. Uhlig had simply found Doyle’s
name and email address on the Ms. Sparky website.2

    2 Uhlig’s email accusations eventually prompted two members of the
Defense Contract Management Agency’s quality-assurance staff to inves-
tigate the tasks that Fluor’s electricians were performing. The staff did not
No. 14-2815                                                             7

    One week later, Fluor terminated Uhlig. Fluor says Uhlig’s
email to Ms. Sparky was unacceptable not only because it was
inflammatory but also because it contained Thomas Rizzo’s
name, email address, and phone numbers, which were not
publicly available. Sending this information to the Ms. Sparky
email address violated Fluor’s computer-use policy.
    On February 15, 2011, Uhlig filed False Claims Act and re-
taliatory-discharge claims against Fluor. The government de-
clined to intervene as the plaintiff on its own behalf under
31 U.S.C. § 3730(b)(4)(B).
    Fluor moved for summary judgment, and the district
court granted Fluor’s motion on August 6, 2014. In dismissing
the False Claims Act claim, the district court held that Fluor’s
contract with the Army did not require that journeyman elec-
tricians be licensed and therefore that Fluor had not breached
the contract. The court dismissed Uhlig’s retaliation claim be-
cause Uhlig had no objective basis for asserting that Fluor had
defrauded the government, thus his complaint was not “pro-
tected activity” under the False Claims Act. This appeal fol-
lowed.
                              II. Discussion
   We review a district court’s grant of summary judgment
de novo, examining the record in the light most favorable to

find any problems. On-site Defense Contract Management Agency Com-
mander Colonel Cameron Holt said he was not concerned about Uhlig’s
allegations. Fluor received no written feedback from the Defense Contract
Management Agency regarding the investigation, and Fluor was never
asked to change its practices or procedures with respect to the assignment
of electrical tasks.
8                                                       No. 14-2815

the nonmoving party. United States ex rel. Feingold v. AdminaS-
tar Fed., Inc., 324 F.3d 492, 494 (7th Cir. 2003) (citation omitted).
Summary judgment is proper when “there is no genuine dis-
pute as to any material fact and the movant is entitled to judg-
ment as a matter of law.” Fed. R. Civ. P. 56(a).
    A. False Claims
    The False Claims Act, 31 U.S.C. § 3729 et seq., makes it un-
lawful to (1) knowingly present a “false or fraudulent claim
for payment or approval” to the United States government, or
(2) knowingly make, use, or cause to be made or used a “false
record or statement material to a false or fraudulent claim.”
31 U.S.C. § 3729(a).
    Under the Act, private individuals such as Uhlig—re-
ferred to as “relators”—may file qui tam civil actions on behalf
of the United States. To establish civil liability under the False
Claims Act, a relator generally must show that (1) the defend-
ant made a statement in order to receive money from the gov-
ernment; (2) the statement was false; (3) the defendant knew
the statement was false; and (4) the false statement was mate-
rial to the government’s decision to pay or approve the false
claim. United States ex rel. Yannacopoulos v. Gen. Dynamics, 652
F.3d 818, 822, 828 (7th Cir. 2011) (citations omitted).
    Uhlig says Fluor violated the False Claims Act by know-
ingly employing unlicensed electricians in breach of its con-
tract and submitting invoices for the unlicensed services to
the government for payment. However, the contract did not
require licensing. Modification 4 to the LOGCAP IV contract
required craft employees to “possess a license, certification,
training, and/or education commensurate with the level of du-
ties to which they are assigned” (emphasis added). Further,
No. 14-2815                                                      9

the Trades Certification and Validation Plan, which was the
contractual standard by which the employees’ qualifications
were to be established, also did not require licensing. Rather,
the Plan defined “journeyman” as a “[s]killed craftsman …
having verifiable minimum experience and/or hold[ing] a uni-
versally accepted certification, license and/or degree” (empha-
ses added).
    The contract language clearly provided a set of options for
establishing an employee’s qualifications, and licensing was
not the exclusive method for doing so. Though Fluor inde-
pendently decided to phase in a self-imposed requirement
that journeymen must hold a license, this internal require-
ment did not change the plain terms of the contract. See Yanna-
copoulos, 652 F.3d at 826. As a result, Fluor was not in breach
of its contract with the government when it submitted in-
voices for electrical work performed by unlicensed electri-
cians.
    Uhlig also argues that Modification 4 is an “alternative
contract.” As a result, he concludes, once Fluor elected one of
the four listed means of verifying its electricians’ qualifica-
tions, Fluor was required to abide by its choice, or else be in
breach of the contract. See Eagle Star Ins. Co. v. Seneca Ins. Co.,
No. 94 CIV. 9106 (JFK), 1995 WL 733642, at *3 (S.D.N.Y. Dec.
12, 1995).
      We disagree. Eagle Star describes an alternative contract
as:
         one in which a party promises to render some
         one of two or more alternative performances, ei-
         ther one of which is mutually agreed upon as
         the bargained-for equivalent given in exchange
10                                                  No. 14-2815

       for the return performance by the other party.
       Once a party elects its method of performance,
       the contract ceases to be an alternative contract
       and the electing party is obligated to perform in
       accordance with the method of performance
       elected by him.
Id. (internal citations and quotation marks omitted).
   The Letter Agreement in Eagle Star contemplated mutually
exclusive performance options. See id. at *4. Here, however,
the language in Modification 4 and the Trades Certification
and Validation Plan contemplates compatible choices, as in-
dicated by the repeated use of “and/or” in describing the
qualification options.
    Indeed, a plain reading of Modification 4 and the Trades
Certification Validation Plan is that Fluor needed to ensure
that its electricians were qualified for the duties to which they
were assigned by virtue of at least one of the following: li-
cense, certification, training, or education. Nothing in the con-
tract suggests that Fluor was required to elect one method of
verifying its electricians’ qualification and that Fluor would
then be limited to that method. In other words, under the con-
tract, Fluor could ensure that one electrician was qualified via
education, another via certification, and a third through licen-
sure, so long as each was qualified. Further, the contract did
not forbid Fluor from applying higher internal licensure poli-
cies to American electricians relative to other-country na-
tional electricians. The contract at issue, therefore, is not an
“alternative contract.”
   Finally, Uhlig cites to emails from Fluor employees alleg-
edly interpreting the contract to prohibit unlicensed other-
No. 14-2815                                                      11

country nationals from performing electrical work. However,
these messages do not change the contract’s plain terms. See
Yannacopoulos, 652 F.3d at 826 (when “[t]he language of [the
contract] is clear on its face, … the intent of the parties is to be
derived only from the express language of the contract”) (ci-
tation and internal quotation marks omitted).
    Fluor did not breach its contract. Therefore, there was no
false statement under the False Claims Act, and we affirm the
district court’s decision.
   B. Retaliation
    Uhlig next argues that the district court erred in dismiss-
ing his retaliation claim. An employee can pursue a claim for
unlawful retaliation if he was discharged “because of lawful
acts done by the employee … in furtherance of an action un-
der” the False Claims Act. 31 U.S.C. § 3730(h). In other words,
a plaintiff must prove that he was engaged in protected con-
duct and was fired “because of” that conduct. Halasa v. ITT
Educ. Servs., Inc., 690 F.3d 844, 847 (7th Cir. 2012) (citations
omitted).
    To determine whether an employee’s conduct was pro-
tected, we look at whether “(1) the employee in good faith be-
lieves, and (2) a reasonable employee in the same or similar
circumstances might believe, that the employer is committing
fraud against the government.” Fanslow v. Chi. Mfg. Ctr., Inc.,
384 F.3d 469, 480 (7th Cir. 2004) (citation omitted). In assessing
the second, “objective” prong, we look to the facts known to
the employee at the time of the alleged protected activity. See
id. at 479–80; Mann v. Heckler & Koch Def., Inc., 630 F.3d 338,
345 (4th Cir. 2010).
12                                                  No. 14-2815

    Uhlig’s retaliation claim cannot proceed because he did
not show that, at the time he sent the December 4, 2010 email,
a reasonable employee in Uhlig’s position would have be-
lieved Fluor was defrauding the government. As a result, his
conduct was not protected activity that could give rise to a
retaliation claim.
    Uhlig admits he did not read Modification 4, the Trades
Certification and Validation Plan, or any other relevant con-
tract language before he sent the December 2010 email. He
therefore did not have any firsthand knowledge of Fluor’s
contract obligations to the Army.
    Further, his secondhand knowledge—from two Novem-
ber 2010 emails—was not sufficient to cause a reasonable per-
son to suspect fraud on the part of Fluor. The November 16,
2010 email explained Fluor’s decision to reclassify unlicensed
electricians as “bring[ing] Fluor into better alignment with
[its] contractual requirements.” The November 19, 2010 email
stated that because Uhlig did not have a license, he was being
reclassified as a helper “to align [Fluor’s] job titles and basic
job responsibilities with the appropriate license, in accord-
ance with our contract with the client.”
    Neither of these messages stated that Fluor’s contract with
the government required all electrical work to be performed
by licensed journeymen or that there was no role for unli-
censed helpers. The emails do not state Fluor’s contractual ob-
ligations to the government. Thus, these emails were not
enough to cause someone in Uhlig’s position to believe that
Fluor was defrauding the government.
   Even if Uhlig subjectively believed Fluor was breaching its
contract, he lacked a sufficient basis on which to satisfy the
No. 14-2815                                                13

objective component of the protected-activity test. Uhlig’s
emails attempting to blow the whistle on Fluor’s alleged non-
compliance were therefore not protected activity. As a result,
even if the December 2010 email was the reason for Uhlig’s
termination, it cannot be the basis for a retaliation claim.
                        III. Conclusion
    For the foregoing reasons, we AFFIRM the judgment of the
district court.