08-CV-724 United States of America et al v. Wisconsin Bell Inc
Decision and Order
Relator Todd Heath brought a qui tam action under the False Claims Act alleging that defendant Wisconsin Bell, Inc., fraudulently obtained subsidies by falsely certifying that it was providing telecommunications services to schools and libraries at the lowest rate charged to similarly situated customers for similar services. Wisconsin Bell filed a motion for summary judgment on three grounds. First, Wisconsin Bell argued it could not be liable for any damages because fund from which the subsidies were paid was primarily financed through carrier contributions, not the United States government. Therefore, it argued, the United States could not be injured. Second, Wisconsin Bell argued that Heath's expert inappropriately compared two technologies and two customers that were not similar as a matter of law and, therefore, all related claims should be barred. Finally, Wisconsin Bell argued that the qui tam provisions of the False Claims Act are unconstitutional.
The Court found that, if Wisconsin Bell is found to have violated the False Claims Act, damages will be available for the entire amount of money in the Fund because any injury to the Fund is an injury to the government. In addition, the Court found that the correct measure of damages is the entire amount of any fraudulently obtained claim. As to the similarity of the technologies and customers, the Court found that genuine issues of material fact precluded granting summary judgment and, furthermore, there was not enough evidence to determine that the comparison is inappropriate as a matter of law. Finally, the Court agreed with numerous other Circuit and District Courts in finding that the qui tam provisions of the False Claims Act do not violate the Constitution.
