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As amended April 12, 2002

Appeal from the United States District Court for the Southern District of Mississippi

Plaintiff-Appellant the United States of America (“the Government”) brought the instant action against Defendants-Appellees W. Thad McLaurin, Charles C. Taylor, Jr., and Arthur W. Doty (“the Defendants”) under the civil False Claims Act (“the FCA”). The Government alleges that the Defendants, as owners of the Jackson Apartments in Jackson, Mississippi, repeatedly certified falsely to the Department of Housing and Urban Development (“HUD”) that these apartments complied with the “decent, safe, and sanitary” standard established in the Defendants’ contract with HUD. The district court granted summary judgment to the Defendants, finding that, under the undisputed material facts of the case, the Government could not establish the materiality element of a cause of action under the civil FCA: namely, that the false claims in question “had a natural tendency to influence” or were “capable of influencing” the decision of the governmental body to which they were addressed. The district court also found that, because HUD remitted funds to the Defendants knowing that their certifications were false, the Defendants could not have “knowingly” submitted false claims to HUD. The Government now appeals the district court’s summary judgment, alleging that materiality is not a required element of a cause of action under the civil FCA and that genuine issues of material fact exist regarding whether the Defendants “knowingly” submitted false claims.

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