United States v. Allison Engine 471 F.3d 610 (2006) General Motors subcontracted to Allison Engine to make parts for Navy ships. Allison then subcontracted to General Tool who subcontracted to Ohio Fabricators. The parts made by Ohio Fabricators to be did not meet the required specs, but Ohio delivered them anyway. Some of General Tool's employees filed a qui tam action under the False Claim Act (31 U.S.C. §3729(a)) for damages. The False Claims Act says that if someone blows the whistle on fraud committed against the government, they can recover 3x the cost of the goods from the company. It requires that the company, "§(a)(1) knowingly presents, or causes to be presented, to an officer or employee of the US Government a false or fraudulent claim for payment or approval, or §(a)(2) Knowingly makes, uses, or causes to be made or used, a false record or statement to get a false or fraudulent claim paid or approved by the Government, or §(a)(3) Conspires to defraud the Government by getting a false or fraudulent claim allowed or paid. The Trial Court granted a judgment as a matter of law and dismissed the case. The General Tool employees appealed. The Trial Court found that there was no evidence that the subcontractors or the shipyards ever presented any false or fraudulent claim directly to the United States or the Navy for payment. The Navy paid General Motors a lump sum upfront for the ships, and General Motors paid various subcontractors, who paid various subcontractors. It was impossible to directly link the bad parts made by General Tool with an invoice payable by the Navy. The Appellate Court reversed. Alison Engine appealed. The Appellate Court found that while a claim must be presented to have a claim on §(a)(1), there was no presentment requirement to have a claim under §(a)(2) or §(a)(3). The Court found that there was meaningful variation between the §(a)(1) (which requires the claim to be presented), and the other subsections, which do not have such a requirement. The Court looked to the legislative history, which said that Congress was explicitly trying to overturn the restrictive interpretation that prior courts had given the Statute. The Court looked to the rule against surplusage and found that if you put the presentment clause from the §(a)(1) into the §(a)(2), they would be pretty much the same. That would make the §(a)(2) extraneous, so Congress probably didn't mean to imply §(a)(2) required presentment. The Court noted that remedial Statutes should be interpreted broadly. In a dissent, it was argued that in order to have a claim under the False Claims Act the Federal government must pay the company for the work. In this case, there was no evidence that the Navy received the defective parts, so there is no violation. In addition, the dissent argued that there is an absurd result. It makes anyone receiving government funds implicitly liable for a claim. Btw, this case was scheduled to be heard by the US Supreme Court, after the semester ended, so this is not a final decision.