Paul Solomon brought a False Claims Act action against his employer Northrop Grumman and against Lockheed Martin for making false claims against the government. On a motion for summary judgment, the district court held that it lacked jurisdiction over Solomon’s claims based on the Act’s public disclosure bar. We AFFIRM.
FACTUAL AND PROCEDURAL BACKGROUNDPaul Solomon worked for Northrop Grumman Systems Corporation. Northrop was a subcontractor to Lockheed Martin Corporation on the development of the F-35 Joint Strike Fighter. Lockheed was awarded a Cost Plus Award Fee contract for the F-35, which permitted Lockheed to receive periodic award fees for meeting government performance benchmarks during the life of the project. Lockheed shared its award fees with its subcontractor Northrop. Under the Systems Design and Development contract (the “SDD contract”) for the project, the government required both Lockheed and Northrop to monitor continually and report costs and performance under a system known as the Earned Value Management System (“EVMS”). EVMS is a set of guidelines, metrics, and control systems that allows the government to maintain real-time awareness of program costs and spending.To evaluate EVMS metrics, the government required, through the terms of the SDD contract, that Lockheed submit monthly Cost Performance Reports (“CPRs”) that included up-to-date Estimates at Completion (“EACs”) for each portion of the project. EVMS guidelines required that reported EACs be the “most likely” estimate for the total cost of completing the project. The SDD contract also required Lockheed to maintain a “management reserve” budget for unanticipated challenges arising during the project. EVMS and SDD contract provisions forbid contractors from using management reserve funds to compensate for cost overruns or improve cost performance metrics.Northrop submitted reporting data to Lockheed, who in turn submitted monthly CPRs to the government. The SDD contract provided for the monitoring and measurement of EVMS compliance in at least two ways. First, it mandated access for government auditors from the Defense Contract Management Agency (“DCMA”). Second, under a joint Surveillance Plan established between Northrop and the DCMA, Northrop was to self-report EVMS compliance directly to the government through its own employee auditor.In September 2005, Northrop assigned Solomon to serve as “EVMS Monitor” or EVMS “Focal Point” for the Joint Strike Fighter program. Solomon drafted the Surveillance Plan on behalf of Northrop, co-signed by his DCMA counterpart, outlining the ways in which Northrop would comply with its EVMS contractual obligations. According to Solomon, he had full discretion, as the Focal Point, “to direct the scope of [his] investigations, including any accounts or compliance issues that came to [his] attention.” Solomon submitted his surveillance reports directly to the DCMA. The DCMA frequently co-signed the reports. Over the course of the project, Solomon revealed in his surveillance reports that Lockheed and Northrop were authorizing retroactive application of management reserve funds to improve cost-performance overruns. According to Solomon, this constituted false cost variance reporting that led to Lockheed and Northrop being awarded fees they would not have otherwise received.In 2007, the DCMA conducted an EVMS audit of Lockheed. In its report, the DCMA concluded that Lockheed was not in compliance with a number of EVMS guidelines, including mismanagement and improper use of management reserve funds to keep “the cost performance index (CPI) from worsening.” In 2008, the Government Accountability Office (“GAO”) filed a similar report, noting that Lockheed was “using management reserve funds to alter its own and subcontractor performance levels and cost overruns.” In August 2007, Northrop transferred Solomon to a different project. He nonetheless continued to investigate the F-35 project and was given a copy of a Memorandum of Agreement (“MOA”) by another Northrop supervisor. The unsigned MOA between Northrop and Lockheed allegedly indicates Lockheed’s instructions to Northrop to meet a budget of $3.721 billion despite it being a “significant performance challenge [.]” If Northrop was unable to meet the required target, Lockheed indicated it would use management reserve funds to increase Northrop’s budget.Solomon retired in 2008. He filed a qui tam action under the False Claims Act (“FCA”) in 2012, alleging that both Lockheed and Northrop submitted false claims to the government. Lockheed and Northrop moved for summary judgment, arguing that Solomon triggered the FCA’s jurisdictional bar. The district court held that Solomon was jurisdictionally barred because his complaint could have been synthesized from public disclosures, and he did not qualify as an original source because his reports to the government had been nonvoluntary. Solomon timely appealed.DISCUSSIONFor purposes of appellate review, a challenge under the FCA’s jurisdictional bar is the equivalent of a motion for summary judgment because it is necessarily intertwined with the merits. United States ex rel. Jamison v. McKesson Corp., 649 F.3d 322, 326 (5th Cir. 2011). “We review a summary judgment de novo, applying the same standard as the district court.” Id. Summary judgment is proper “if, viewing the evidence in the light most favorable to the non-moving party, there is no genuine dispute a[s] to any material fact and the movant is entitled to judgment as a matter of law.” Id. Additionally, the parties do not dispute that because Solomon’s claims concern events prior to 2010, this case is governed by the FCA’s language immediately prior to the 2010 amendments to the Act.Under the FCA, any person who “knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval” is liable to the United States Government for civil penalties. See 31 U.S.C. § 3729(a)(1) (2012). The pre-2010 version of the FCA contains the following jurisdictional bar, a provision now altered in the current FCA: No court shall have jurisdiction over an action under this section based upon the public disclosure of allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, or Government Accounting Office report, hearing, audit, or investigation, or from the news media, unless the action is brought by the Attorney General or the person bringing the action is an original source of the information. For purposes of this paragraph, “original source” means an individual who has direct and independent knowledge of the information on which the allegations are based and has voluntarily provided the information to the Government before filing an action under this section which is based on the information. 31 U.S.C. § 3730(e)(4)(A)-(B) (2006).We have previously applied the FCA’s jurisdictional bar by using a three-part test, “asking ’1) whether there has been a “public disclosure” of allegationsor transactions, 2) whether the qui tam action is “based upon” such publiclydisclosed allegations, and 3) if so, whether the relator is the “original source”of the information.’” Jamison, 649 F.3d at 327 (citation omitted). The purposeof the jurisdictional bar is both to promote private citizen involvement in fraudexposure while also “preventing parasitic suits by opportunistic late-comerswho add nothing to the exposure of fraud.” United States ex rel. Reagan v. E.Tex. Med. Ctr. Reg’l Healthcare Sys., 384 F.3d 168, 174 (5th Cir. 2004) (citationomitted).
