THE BALLEW SYNDROME

        EXECUTIVE SUMMARY - There is an internal government report that was prepared for the Assistant Secretary of the U.S. Department of Transportation that completely conflicts with public statements and sworn court testimony of the staff and attorneys for the U.S. Department of Justice and the U.S. Coast Guard. The USCG answers to the Transportation Department in peacetime and to the Navy Department during times of war. Product Improvement Programs ("PIP") are programs to update or improve the performance or form, fit, and function of a product or system. They are often used by the government to conceal defects and to fraudulently conceal use of taxpayer funds to fix defects and support defective systems.
        The Congressional intent of the False Claims Act ("FCA") is subverted (1) by fraudulently misrepresenting fraud proceeds as "contract claims" negotiated under the FCA "seal" (without the FCA "relator's" involvement, knowledge, or knowing agreement) and (2) by fraudulently delivering the value of these proceeds back to the defraud agency instead of the Treasury (public fisc), thus avoiding unfavorable Congressional oversight and sanctions. The taxpayers suffer a "taking" of their "proceeds of the (FCA) action or settlement of the (fraud) claim" under the FCA.

        DISCUSSION - A helicopter fleet, bought with taxpayer dollars and used for national defense, drug interdiction and rescue was completely deficient and unacceptable for the first five years of its life. Details of the original source of the disclosure about defect information, the true scope of the problem, and the true amount of taxdollars to perpetuate and remedy these defects has been knowingly and fraudulenty concealed by parties within the U.S. Department of Justice's Civil Division and the U.S. Coast Guard's Headquarters.
        A scheme to use taxpayer dollars to fix a defendent's/manufacturer's defects is being misrepresented and fraudulently concealed as a "Product Improvement Program". As an example, this Product Improvement Program is not a "PIP". It was a vehicle to pay the manufacturers to fix their own defects at more than three times the expected and then-current-market, maintenance rates. Taxpayers paid for an "advanced, state-of-the-art" helicopter and engine system at the initial deliver of each helicopter in the fleet. Taxpayers also paid for the engine "modules" to be 100% interchangeable and for no parts to be changed without prior written consent. Engines should last 2400 hours before requiring overhaul but, instead, required overhaul 9 times as often as disclosed to the public. Modular construction (unbolt one broken module, bolt in new or overhauled module) never worked. Expensive, one-piece, machined rotors and rotor blades never worked and the manufacturer went back to the old style, but charged the government for the "fix" and, unbelievibly, at the additional, higher price.
        The problem becomes blatently obvious when twin ehgines in a helicopter fail after 240 hours instead of 2400 hours. There is simply 10 time the maintenance cost to overhaul engines that should not fail... and it is paid for with taxpayers' dollars.
        The "findings" in this report identify a "Product Improvement Program" that is being used to pay a defendant to fix his own defects. Even worse, they knew exactly what the defendants (1) represented, (2) advertised and (3) proposed as the "expected maintenance cost at purchase ($40.00/engine hour)" and they knew that the government had been spending an enormous amount of taxpayer dollars doing the defendents job of trying to maintain and fix the defects. "current estimated depot maintenance ($142.00/engine hour)". Coast Guard reports even hid the massive "field maintenance costs", generated by the defects, by not including them in their corrective actions litigations and research. This clearly abused the U.S. Coast Guard field maintenance personnel by making them work extended hours and be held professionally responsible for repeatedly and unsuccessfully attempting to repair a system the "brass" knew was defective. This report even states, "Uniformed field maintenance personnel are paid a constant salary, regardless of the number of hours worked" and "For these reasons, field maintenance costs were not considered as part of the baseline costs of the current engine."

        CONCLUSION - Product Improvement Programs ("PIP") are being used to disguise unresolved defects at the taxpayers expense. The USCG's Product Improvement Program is the final and conclusive "smoking gun". It identifies the same specific defects that I "red tagged" and rejected and then disclosed to the DOJ as the "defective hot-end section" and the "defective snow injestion system. This completely proves that the government knowingly concealed the truth. This report specifically identifies, proves and mirrors exactly what I had claimed and disclosed in the original qui tam or False Claims Act lawsuit in 1987, but was denied in the District Court by the USCG and DOJ. Related litigation went all the way to the Supreme Court and Main Justice has never admitted or corrected their statements.
        This report was prepared for and delivered to an official of the Coast Guard's over-seers before the final representations were made to the public or the courts of jurisdiction... and the information was never disclosed to the courts by the USCG or the DOJ! Taxpayers are paying a second time for the same defects.
        The FINDINGS in the report state it clearly:

DOT Report Number RSPA/TSC-CG096-TM-1, dated 12/00/89, Page xiv - "The cumulative 10% discounted cost for the engine improvement program over the period 1989 to 2005 is estimated at between $69 and $90 million (in 1989 dollars), versus $114 million for continued use of the engine with no improvements."