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PROLOGUE
        Problem - Global
        Problem - Specific
        Bias - All Government Agencies
        Bias - Department of Justice
        Bias - Appeals Court
        Bias - Mine.
CONCLUSION

PROLOGUE:

        My background and curriculum vitae are simple. No matter what the title was, I was and am a glorified clerk. What is not simple or contested was that I was and am one of the absolute best and most thorough researchers in the world today. As a "Certified Purchashing Manager" ("C.P.M.") and, more specifically, as the Senior Contract Administrator, I sat across the negotiation tables from many of the largest, international, arms dealers. I sat in the senior chairs of some of largest, multinational defense industry conglomorates, negotiating substantial contracts and enforcing many systems' quality and compliance requirements.
        My first day on this type of battlefield was in the late 1960's, nearly thirty years ago. I have been in this particular battle for almost 15 years. I "won" the first battle and, trusted our system, and have lost nearly every battle since then. But, I still trust our system, so I am bringing my story to the public, at large. I trust people much more than I trust governments. (They work too hard trying to hide their actions.)
        I am now announcing that we are taking this specific problem to the Supreme Court for the help of their wisdom and their consideration. If we fail there, (1) I will have exhausted my legal remedies, but (2) I will have done every thing that I personally can to make this right. I still think this is the best system of government and country in the world.
        I find it specifically offensive for this story to be characterized by any government "mouth-piece" that is only recently assigned to do "damage control". Remember, I have their documents! When the "spin masters" within our government attempt to sanitize and perpetuate the events in the story I'm going to tell you below, I start wishing. I wish I was young and healthy enough to give them what my beloved, railroad-engineer father called "a behind-the-barn, eye blurring a _ _-whuppin!" I've had them. They deserve them. I find it specifically offensive to be characterized by any government "mouth-piece" that is still wet behind the ears!
        My experience and accomplishments always get me "in-the-door" and my inability to compromise on the rules has caused me to be reviled. I grew up in a world of cooperation, obligations and rules, and that brings us to my story.
        The "spin masters" within our government would tell you different, but don't believe them. Read, think, and make your own decision. Use your knowledge of history and human, corporate, industrial, and political frailities. They are stealing your tax dollars and their documents are posted here to prove it. More importantly, they are endangering our armed service mens' and womens' lives, and knowingly and callously covering it up.
        Please get involved in any way you can. Help me, please. Thank you.

Respectfully... Comments to: Bob Ballew

STATEMENT OF GLOBAL PROBLEM:

A private citizen's "successful, fraud-on-the-government lawsuit" happens when neither the government agency nor the DOJ (1) prevent, (2) discover, or (3) stop the fraud. It is even worse if the Government attorneys divert the recovery dollars and cover it up. My story involves what was called the largest fraud recovery in history in the Department of Justice's (DOJ) Press Release on July 10, 1990. If the DOJ had told the entire story, its true total was more that the DOJ reported for the entire year.

Other federal court fraud caselaw states it in plain and simple language.

    Note 35. ...Qui tam actions, ...aim to redress purely public injuries."

    Joyce Riley, Plaintiff - Appellant, v. St. Lukes Episcopal Hospital, et. al. Defendants - Appellees, No. 97-20948 in the United States Court of Appeals for the Fifth Circuit, before Smith, DeMoss, and Stewart, Circuit Judges, Opinion by Jerry E. Smith, Circuit Judge.

    ...were in part proceeds of the action and due to the public treasury.

    U.S. ex rel. Gibeault v. Texas Instruments, 104 F.3d 276 (9th Cir. 1997)

It is unacceptable when fraud recovery "proceeds" are not delivered to the Treasury, but, instead, are mislabeled, misrepresented, diverted and covered up. It appears that it has become an unspoken but consistant government "policy and custom" in many documented fraud lawsuits.

This type of government "piracy" (of our tax-dollars) has been repeatedly condemned by certain federal courts and must be against "public policy". It is not an exception, but instead, a "policy and custom" of the Department of Justice. CLICK HERE to see what certain federal Judges have said about this exact type of reprehensible DOJ behavior in other fraud lawsuits.

It is an absolute outrage and those responsible should be punished for it. In most lawsuits, the DOJ simply mislabels the alternate remedies and waived administrative claims as "non-proceeds" and never presents them to the court, the Treasury Department or Congress. The DOJ enables the agency to enjoy an unallocated and unjust enrichment of their budget, without any Congressional or taxpayer oversight, that is, no "Checks and Balances".

I believe that it is the ultimate and critical responsibility of the Secretary of the Treasury to cause this type of "Government Waste, Fraud, and Abuse" to be investigated and stopped, and the guilty individuals punished! CLICK HERE to see the law covering these corrupt actions.

The "public fisc" is being robbed repeatedly. Public (or "Taxpayer's Dollars") are constantly diverted from "Fraud-On-The-Government" court cases back to the defrauded agency instead of the Treasury Department's general account. Congressional oversight, review and control are evaded and the courts are led to believe the defrauded agency recovered less than the defrauded agency really did. (This can be the majority of the recovery!)

This results in a budget windfall to the agency in the form of unrecognized, uncontrolled use of public funds (or an "alternate remedy" with a specific "dollar value") that is neither properly identified to the appropriate court, nor approved nor reappropriated by Congress. Responsibility and exposure is dodged and the public fisc and its taxpayers are knowingly cheated by those involved.

To add insult to injury, the majority of these cases are negotiated under seal and settled. These cases usually are sealed before, during, and after their proceedings and all of their facts are exempt from the Freedom of Information Act, under this law. DOJ "Press Releases", like corporate and advertising press releases, only tell us what a good job they did. The DOJ has become a warehouse of private fraud facts. This seems contrary to public safety and public policy. It is government by secret!

In my opinion, as the conclusion of my 14 year-long research and analysis, taxpayer dollars are being "stolen"!. It is one thing not to know about it. It is completely different to know about it and do nothing.

 
STATEMENT OF SPECIFIC PROBLEM - Government agencies, in the Executive Branch of the U.S. Government, fight in every way possible to retain as much as possible of the "proceeds of the action or settlement of the claim" in a fraud recovery proceeding (with the aid of the DOJ, both legally and illegally). Congress was very clear. It crafted, drafted, and approved a law that uses the mandatory term "shall" more than thirty-five times in the first two sections and it cannot be misunderstood. The DOJ does not like this law. The Department of Justice has enacted a standardized "policy and custom" of handling these cases which is, in my opinion, blatently illegal and corrupt.

 Congress' clearly stated intent was for all fraud proceeds to be identified to the appropriate court and then returned to the Treasury, never directly back to the defrauded agency. This is commonly called a "check and balance"! The agency's use of these publically owned assets without proper disclosure and legal allocations by Congress is called either a "taking" or "taxation without representation". As a simple person, I call this theft!

 
GOVERNMENT AGENCY BIAS - The term "Whistlleblower", like "snitch" and "informer", is intentionally derogatory, and is used to demean anyone that files a case to stop fraud that the DOJ, defrauded agency, and Defendant did not discover or prevent. Additionally, it diverts attention from the fact that Congress knew that the DOJ needed help and offered what a marketing director would call a "commission" to take up the fight. It is always an embarrassment to the DOJ and agency, but even more so to the Defendant who is required, by law, to pay the "commission" directly to the DOJ labeled "Whistleblower".

 The DOJ maligns any taxpayer who takes up the job to protect and recover what is obviously his and his fellow citizens' taxdollars. The DOJ has a vested interest in "damage control". The agency has a vested interest in not losing their jobs for "negligence", "incompetence" or "mismanagement". The "Whistleblower" has a vested interested in recovering tax dollars that belong to all of us and his Congressionally mandated "commission". All "Whistleblowers" are not the crazy, greedy fools that the DOJ trys to characterize them as.

 Any qui tam ("Whistlleblower") lawsuit's two dominant "material facts" are (1) the "entire" amount of damages suffered by the government (read "taxpayers") and (2) the "entire" amount of tax dollars recovered. These "total fraud damages" are called "proceeds of the action or settlement of the claim" by the Court. To be precisely clear, restated, "How much (in $'s, cash and alternate remedy $ values) were the damages?" and "What did the government get back (in $'s)?" The first material fact is just that, a "material fact". The second is what the court must identify in order to do its job and make a final decision. This information is required by the court to find:

    "...pursuant to 31 U.S.C. § 3730(b)(1), that the Settlement Agreement between the parties provides a fair, adequate, and reasonable resolution of this case under all the circumstances."

If the total "proceeds of the action or settlement of the claim" are not disclosed to the Court, then the law requirements and the U.S. Congress' stated intent cannot be accomplished. The plain language of the law clearly mandates the return of all recovered proceeds to the U.S Treasury's general account, not to the defrauded agency's appropriation account and to identify any alternate remedies to the court before any settlement. The Court must include the tax-dollar value of these "taxpayer assets" in the material facts of the lawsuit so that the taxpayer is not short-changed. As it should be, the majority of the proceeds, up to 85% of any recovery, goes to the government.

    The court noted that, even without intervention, the United States receives the majority of any amount recovered... U.S. ex rel. Jane Doe 1 et al. v. X, Inc. et al., 2000 WL 305742 (E.D. Va. March 23, 2000)

CLICK HERE to read the laws that are in place to punish any government employee that is supposed to receive money for the government, but does not deliver all of it to the Treasury. (There are some exceptions for small portions of it not including agency appropriation accounts.) Government agencies, in the Executive Branch of the U.S. Government, fight in every way possible (with what seems to be both the legal and illegal aid of the DOJ) to retain as much as possible of the "proceeds of the action or settlement of the claim" in a fraud recovery proceeding.

 
DEPARTMENT OF JUSTICE BIAS - Sen. Charles Grassley (R-Iowa), who authored amendments that strengthened the law in 1986, spoke clearly and simply when he spoke about the DOJ's treatment of qui tam plaintiffs. He commented on the entire environment of the Justice Department and what it was like to deal with them. He said...

William Ramsey, a Valencia, California attorney said...

APPEAL COURT BIAS - Some federal courts seem fair (See "Conclusion" below) and some seem biased (See Judge Jones' statement immediately below.) It also appears that some Judges assigned to hear this instant appeal care less about justice, fairness and the fate of our tax-dollars than they do about the government's convenience. (I was taught that the obligations of a U.S. Citizen included observation, analysis and personal sacrafice and involvement, when appropriate! She made this statement on about 09/21/00 and issued her opinion in this instant case on 12/15/00. It clearly was part of the basis of her statement.) In my opinion, this Judge's public statement, and therefore, bias, does not seem neutral:

 
MY BIAS - With all due respect to the Honorable Judge Jones (if any is due at all...), isn't that called exhausting your legal remedies? It is exhausting! I've been involuntarily involved since 1987 and I haven't been able to get the government to do the right thing yet! (And I have a copy of all of their documents proving the fraud and then the diversion of tax-dollars... Go figure!) This is clearly an internal Executive Branch agency policy and custom. The spin doctors at DOJ try to minimize this situation, but they are fully aware of the policy. The DOJ Manual even stated that they should settle major cases for multiple damages and some forfeitures and then report it accurately.

    "Flagrant frauds, justifying the initiation of suits for multiple damages and penalties under relevant statutes generally, should not be compromised for less than multiple damages and some forfeitures." U.S. Attorney's Manual (DOJ), § 4-4.110 - Civil Fraud Litigation, ¶ 4, Sentence 4 (Rev.06/98.)

    Cases Delegated To United States Attorneys., ¶ 2, (Rev.06/98.) - "Disposition of delegated cases, like the disposition of nondelegated cases, must be accurately reported on the Department's statistical reporting system. In particular, all money and property collected for the government should be reported." U.S. Attorney's Manual (DOJ), § 4-1.511

 
Finally, 1st-person-experience has now taught me not to trust the FBI, DOJ, USCG, or the Defendents. Here is a simple example, among the many that I can document, which, in my opinion, shows intentional actions to circumvent the laws:

  1. FBI - On two occassions, during the initial sealed investigation, the Special Agents of Federal Bureau of Investigation, assigned to this case, stated clearly and emphatically that "We could not find any fraud and this investigation will be closed." The Plaintiff knew better after experiencing it during the 25 days leading up to his required disclosure. Plaintiff worked with and fought with the DOJ until they understood the fraud.

  2. DOJ - Forfeitures and alternate remedies, in many other qui tam cases, were announced in DOJ press releases but not identified as "proceeds of the action or settlement of the claim" to the District Courts nor returned to the U.S. Treasury Department's general account.

  3. USCG - Attempted to sign a blanket "no harm" release with the two defendants so that the problem would just "go away" (at a cost to the taxpayers of about $360,000,000.00). This wasn't stopped until Plaintiff discovered these covert negotiations, delivered documented proof of the plan to the DOJ and forced the DOJ to intervene and stop it. Mr. Robert Vogel, DOJ Attorney, told Plaintiff and Plaintiff's attorney that he had to threaten any government employee that signed the release with jail time to prevent it. This included USCG personnel.

  4. Defendant # 1 - Destroyed documents to evade contractual and legal requirements to disclose known "safety of flight" defects listed, reported, and maintained in an internal "TOP 50" failure-by-hours-used-report. Lead system inspector, who maintained the defective system's history and configuration records, later committed murder-suicide with his co-employee spouse, who was a "Spare Parts" buyer on the same system. I worked with both of them and was told by them that they argued regularly over the ethics of their delimma. One "team player" and one "square shooter". These were real and tragically unnecessary deaths. Company later pled guilty to similar fraud in another situation dealing with international sales. This could have been stopped or prevented. Finally, Defendant waived $26,000,000.00 in administrative claims, to settle a fraud case in which the DOJ implied they were innocent.

  5. Defendant # 2 - Paid $17,000,000.00 in cash to settle a case in which the DOJ implied that was cured by this payment. Additionally, the USCG agreed to pay the Defendent to fix the Defendent's own defects. It is being paid for, recurringly, at twice the market rate, under a 6 year maintenance agreement addressing a $20,000,000.00 per year cost, to repair and maintain their own defects in a system that had already been paid for. The Defendant also sold what USCG and DOJ reports labeled as "defective" spare parts directly to the government at full retail price for 4 years, without the same warranty that they delivered to commercial customers. The "meat of the settlement" for the USCG in this fraud lawsuit, was the "Power-By-The-Hour" agreement. It was an alternate remedy (instead of a cash settlement) that the USCG had requested from the DOJ attorney assigned to the case as part of any settlement. This was premeditated, included the affirmative actions of the USCG, DOJ, and Defendant, and involved the DOJ attorneys. This was not included as part of the "proceeds of the action or settlement of the claim" and inured directly back to the USCG's agency apprpriation accounts. The DOJ publically defined the value of this PBTH contract as $10 million per year for the 6 year even though they knew that the real cost of just the excessive cost of the USCG program of excessive emergency overhauls and required infrastructure to handle the defects was over $22,000,000.00 per year. This is like buying and paying for a new car at delivery and then paying the dealer at twice the normal mechanic's labor rate for every hour you drove the car, just to keep the car engine running. Isn't that what you paid for when you bought the car? Amazingly, the USCG had taken over the majority of the excessive repairs and overhauls and had used unidentified additional, "theoretical appropriations" to pay for an entire infrastructure to fix the defendant's defects. They used the "cash proceeds" to pay back these "theoretical appropriations" and the balance or majority of the settlement was diverted to their own benefit.

Would you trust any of them?

CONCLUSION -

1. The DOJ was unethically and covertly involved with the USCG from the start, before obtaining the Court's approval to legally intervene or represent any party to this lawsuit.
2. The government lied when they said, "The "Power-By-The-Hour Repair Contract (1) wasn't related to or (2) a part of the false claims proceeds deliverable to the Treasury or disclosable to the Court as proceeds!"
3. The government also lied when they said, "It wasn't a false claims alternate remedy!"
4. The government's "Analysis of Settlement" tells us what the DOJ hid and now we know why the government lied and what their intent was!

Federal Courts, all over the land, have tried to stop the DOJ from continuing this unethical "policy and custom". Others have helped the DOJ perpetuate it. It appears that only the Supreme Court or intensive Congressional oversight will stop this. Please contact you Congressman or Congresswoman and let them know of your dissatisfaction. Read what some of the courts have formally and publically said below. Every situation described below is also an exact description of how the DOJ performed in this instant case. Again, remember that we have the documents to prove it! My case started back in 1987, before any of these cases, and the DOJ is still doing it today!

    US v. Hill, 48 F3d 228 (7th Cir.1995) * The more recent a precedent, the more authoritative it is.

    USA ex rel Covington, Sidicane v. Sisters of the Third Order of Saint Dominic of Hanford, California, d.b.a. - Sacred Heart Hospital, et al, 61 F.3d 909, Unpublished Disposition, 1995 WL418311 (9th Cir. July 13, 1995)

    • The Government attempted to foreclose qui tam relators from receiving a share from a payment received from the defendant because the govemment classified the payment as "restitution" as opposed to "damages".

    • The appellate court succinctly rejected the Government's argument, pointing out that such a rule would allow the Government to eliminate recovery for qui tam relators by simply characterizing the nature of the defendant's conduct.

    U.S.A. ex rel. Peter Jensen Thornton v. Science Applications International Corporation, et al., Order Awarding Statutory Share of Settlement And Denying Request For Attorney Fees, filed September 17, 1998, Civil Action No. 3:94-CV-0749-T, In The U.S. District Court for the Northern District of Texas, Dallas Division, defined ..qui tam proceeds and defined the requirements for the relator to successfully request and receive attorney's fees.

    • A qui tarn plaintiff should receive between 15% and 20% of the proceeds, depending on how much the person substantially contributed to the prosecution of the claim. See 31 U.S.C. 3730(d)(l).

    • Based on (1) the plain meaning of the word "proceeds," (2) the terms of the settlement agreement, and (3) the representations of the parties, the Court concludes that the claims released (or abandoned) by Defendants are included in the proceeds of the settlement.

    • In sum, the Court concludes that the $... cash and the claims abandoned by Defendants should be included as the proceeds of the settlement.

    U.S. ex rel. Neher, as Personal Representative of the Estate of Arthur P. Williams v. NEC Corp., No. 92-2854 (11th Cir. Apr. 28, 1995) recently defined the conditions of an illegal "de facto" intervention and termination of the lawsuit by the actions of the government lacking Court approval. It stated:

    • The 11th Circuit characterized the Government's arguments as "specious" and as an attempt "to take advantage of its blatant violations of the statute."

    • In a strongly worded opinion, critical of the Government's handling of the case, the appellate court concluded that the government's settlement with the defendant constituted an election to intervene in the lawsuit and that the estate of the deceased relator was entitled to 15 percent of the settlement.

    • The court held that the Government's settlement with NEC constituted an election to intervene in the lawsuit and proceed with the action within the meaning of the False Claims Act.

    • ...the settlement effectively terminated the lawsuit, except for the determination of William's statutory share under 3730(d)(l) of between 15 and 25 percent (as well as attorneys' fees and expenses.)

    U.S.A. ex rel. Robert J. Merena v. SmithKline Beecham Corp., SmithKline Beecham Clinical Laboratories, Inc., Judgement, dated April 8, 1998, Civil Action No. 93-5974, originally filed on July 23, 1997, In The U.S. District Court for the Eastern District of Pennsylvania.

    • Footnote # 10 - "The Government did not elect to intervene until after it had agreed with (defendant) on specific settlement terms to resolve all of the claims in the (plaintiffs') cases and long after the (date) agreement in principle had been negotiated."

    • Page 30 - "The necessary element under the statute is not an investigation but rather public disclosure. Government investigations are ordinarily not publicly disclosed until they are completed. Merely because a qui tarn complaint may make allegations that correspond with or parallel allegations that a Government agency may be investigating, the qui tam action is not barred, nor is the qui tam relator precluded from an appropriate statutory share of any resulting recovery."

    • Page 37 - "Were a qui tam action is filed, and the Government intervenes and expands the allegations of the complaint, or settles the action, including broader claims than alleged in the qui tam action, this should not preclude the qui tam relator..from ..receiving the minimum statutory qui tam share of l5 percent of the entire settlement, as well as a percent above the 15 percent minimum up to a maximum of 25 percent "...depending upon the extent to which the person (qui tam Relator) substantially contributed to the prosecution of the action."

    • Page 41 - "There is absolutely no evidence on the record before me, beyond the unacceptable waiver argument, to establish any allocation among various claims. The Relators repeatedly sought explanation from the Government, both informally and in discovery,as to the Government's allocation calculations. The Government's only response is, and always has been, that the calculations were based on rational estimates of losses and complex negotiations among various governmental agencies and that the parties and the court are bound to accept the Government's calculations. It seems to me to be almost a "trust us, we are not wrong, we are correct" attitude. The Government tries, at a minimum, to require Relators to prove the allocations are in error without providing Relators with any discovery on the issue, although such discovery was reguested. This I cannot accept. I conclude on this issue, that the Relators are not bound by the allocations assigned by the Government as to the... and the... qui tam allegations. It is the Government that attempts to reduce the individual and total qui tam award shares by assigning particular values to various claims.

    • Page 70 - "I am left with the impression that the attorneys in charge of the... investigation, conducted... by the DOJ seek to take far more credit for the overall success of the proceeds.

    • Page 72 - "Perhaps the reason the litigation has been presented in this light is because the Government wants to minimize the contributions of the Relators in order to lower their ultimate award.

    • Page 72 - "I recognize that some of the arguments presented by the Government attorneys may have been caused by a sincere desire to save as much of the proceeds as possible for the Government. However, an Act of Congress provides for substantial awards in order that persons who acquire first hand knowledge of false claims being presented to the Government will come forth and file meritorious qui tam complaints. The success of this legislation in continuing to achieve its goals can only be assured by unstintingly providing the qui tam awards dictated by Congress irrespective of the size of the awards."

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