On Friday, the U.S. Department of Justice joined the whistleblower lawsuit that Floyd Landis filed in 2010 against Lance Armstrong and other defendants. The government’s intervention in the False Claims Act case ended months of speculation about whether or not the government would join (including our own speculation – see our previous blog post on this). Qui tam whistleblower cases under the False Claims Act are initially filed under seal until the time that the government either intervenes, joining the action, or declines to intervene, leaving the whistleblower on his or her own. Following the government’s intervention, the Court unsealed the case, making the complaint publicly available for the first time.
Floyd Landis, a former U.S. Postal Service (USPS) teammate of Armstrong’s from 2002 through 2004, is the sole whistleblower or relator, in this action. Landis filed the whistleblower lawsuit against Lance Armstrong, Tailwind Sports (the owner of the USPS team), Johan Bruyneel (the USPS Managing Director from 1998 through 2004) and other individuals and entities who were involved in the operation of the USPS team.
Landis charts the relationship between Tailwind, the USPS team, its riders and sponsor USPS. In doing so, Landis connects the dots between Armstrong, his team and government monies obtained through false claims. USPS began its sponsorship of the USPS team in 1995 and in 1998 Armstrong joined the USPS team. According to Landis, the team’s sponsorship agreement with the USPS required the team and its riders to comply with state and federal law, all rules and regulations of the various organizations that govern professional cycling, and the postal service’s contracting policies. Landis alleges that Armstrong, Tailwind, Bruyneel and others violated professional cycling’s prohibitions against blood doping and the use of performance enhancing drugs, and violated postal service contracting policy through the riders’ illegal use, possession and transfer of performance enhancing drugs and blood doping agents.
Landis describes the team’s doping program as “systematic”. According to Landis, following the 2004 Paris-Roubaix race, Landis got into a heated exchange with team management about a shortage of equipment arising from management’s selling the riders’ bikes for cash used to finance the doping program. Landis claims that a team official responded that the doping had to be paid with cash since illegal doping expenses could not be listed on expense reports.
Landis describes the team’s systematic doping program, led by Armstrong, and his own use of steroids and doping at Armstrong’s direction between 2002 and 2004. He describes his personal knowledge of Armstrong and other team members’ doping and use of performance enhancing drugs at the direction of Armstrong and the team’s manager Bruyneel.
Between 2001 and 2004, Tailwind submitted multiple invoices to the USPS for payment under a series of sponsorship agreements. Based on these invoices, Landis claims that the USPS paid the team’s owner Tailwind Sports in excess of $31.4 million between 2001 and 2004. According to Landis, Tailwind paid Armstrong paid base compensation of $15 million annually between 2001 and 2004, plus bonuses of at least $7 million for each Tour de France victory.
Landis claims that Armstrong and various team officials knowingly made false statements to the press, race officials, and the USPS to make the USPS make payments to the team under the sponsorship agreement, to induce the USPS to enter into a new sponsorship agreement in 2000, and to have the USPS not seek repayment of monies paid pursuant to the sponsorship agreements. According to Landis, Armstrong and the team lied to the USPS before, during and after the USPS’s sponsorship of the team by vehemently denying the use of steroids, other performance enhancing drugs and doping when in fact Armstrong and the team were systematically doing all of the above.
Travis Tygart, the head of the U.S. Anti-Doping Agency (USADA) lobbyied Attorney General Eric Holder, in a January 13 letter, to intervene in the Landis whistleblower case. Tygart’s letter contends that Armstrong and the other named defendants committed fraud and other crimes, bilked the federal government out of tens of millions of dollars, and because of Armstrong’s admission to doping and cheating that this is a case in which the government should easily prevail.
The government has indicated that they are pursuing the case against Armstrong, Tailwind, and Bruyneel and not against other defendants named by Landis in the suit. However, the government requested and the Court has provided that the government may have leave to pursue the case against the other defendants in the future. Armstrong, through his attorneys, was reportedly attempting to settle the False Claims Act case with the government before the government’s intervention and the court’s unsealing, reportedly offering $5 million. The lawsuit is pending in federal court in the District of Columbia (case # 1:10-cv-00976-RLW).
Our Whistleblower Attorneys protect the rights of whistleblowers by pursuing qui tam actions against companies that violate the False Claims Act.