Class Action Law

Whistleblowers May Sue Their Employer Under False Claim Statutes When the Employer Commits Government Fraud

Government contracting is a huge business that spans numerous industries and trades. Contracts between private contractors and State and Federal government agencies account for hundreds of billions of dollars in government spending. Many reports have noted that oversight by government auditors can be lax at times. (See, e.g., Nick Cahil, Audit Finds California Agencies Didn’t Follow Bid Rules, Courthouse News Service, (June 20, 2017).) Government agencies simply do not have the resources to supervise the performance of every contract, and this lack of oversight opens the door to waste, mismanagement, and outright fraud. (See Patrick McGreevy, Caltrans investigations find waste and wrongdoing in state transportation programs, Los Angeles Times, (Dec. 6, 2019).)

Unfortunately, the temptation to treat government contracts as a source of free money proves too much for some contractors. In an effort to curtail fraudulent government contracting, State and Federal governments have placed the power to root out and prosecute fraud in the hands of the people most likely to discover that fraud: employees working on the front lines. State and Federal False Claims Acts create a mechanism called a “qui tam lawsuit,” by which employees of government contractors can blow the whistle on their employers’ frauds by filing a civil lawsuit on behalf of the government.

What Counts as a False Claim?

In some sectors, such as defense, the government cares so deeply about proper contract management that whistleblower laws can apply in cases of “gross mismanagement” or “gross waste” of a government contract. For a normal qui tam case, however, the contractor must usually know it is somehow defrauding the government.

The classic example of a false claim is billing the government for services not actually performed or goods not actually delivered. For example, if a company has a contract to excavate an embankment on government property, and the company falsely bills the government for ten laborers, when in reality the job only required five laborers. Or perhaps a company has a contract to sell medical supplies to a Medicare provider, and it ultimately charges the government for double the supplies that it actually delivers. Either of these situations would be a “false claim.”

More likely the contractor’s fraud will be more sophisticated. A company might take advantage of complicated billing and accounting cycles to falsify records to the government in a way that benefits the contractor. A company might also structure transactions in a way that falsely amplifies overhead costs in order to justify a higher bill that appears normal on its face. Right from the beginning, a company might falsely certify to the government that its costs will be $X, when in fact the company knows the costs will be much higher than $X, in order to win a bid on a contract.

These cases can be very tenuous because government contractors should be held to the highest degree of transparency, considering they are ultimately paid with money that comes from taxpayers. Even something as seemingly minor as an undisclosed conflict of interest during the bidding process can create a false claim. These contracts need to be squeaky clean, and, as they say, if there is a question, there is no question. Anyone who thinks there might be a false claim situation should ask one question: does something about this situation not quite add up? If the answer is “yes,” the situation may warrant investigation.

What About Fraud by the Employees of Government Contractors?

In some cases, employees may submit false claims through their employers. The employer may be totally unaware the government is being defrauded by a “bad apple” within the organization, but that can still count as a false claim for which the employer may be liable to the government. For example, if an office manager for a healthcare provider has found a way to embezzle from his employer by creating fake invoices, the employer may still be held accountable if the embezzled money is ultimately paid out under a government contract for Medicare or Medicaid services.

What Counts as the “Government”?

False claims can be those submitted to any part of a State or Federal government. Usually, a contract will be negotiated with a government agency, or a subdivision of that agency. The scope of the “government” for qui tam purposes is, therefore, fairly broad. In California, for example, the arms of the government that can receive false claims include cities, counties, and the University of California system.

Who Can Be a Whistleblower?

Anyone privy to a fraud could be a potential whistleblower, but the most common qui tam plaintiffs are employees of the contractor where the false claim originated. Employees are right there in the thick of things every day, so they see what’s going on. More importantly, many frauds can be complicated, and employees often have enough expertise in their industry to spot when something isn’t right.

What’s In It For the Whistleblower?

Although many whistleblowers are motivated first and foremost from the desire to thwart corruption, the fear of retaliation, and the inconvenience of being involved in a large lawsuit, gives otherwise motivated whistleblowers a strong incentive to stay silent. In order to balance that incentive, State and Federal laws permit successful whistleblowers to share in any recovery, which can be substantial.

What Happens if the Employer Finds Out About the Whistleblower?

Many employees justifiably fear retaliation by their employers if they reveal fraudulent conduct. Fortunately, qui tam laws also include strong whistleblower protections. If an employer decides to double down on its unlawful conduct by retaliating against the employee who blew the whistle, the employee can recover money damages independent of any recovery in the underlying qui tam case.

What Should I Do if I Think My Employer Defrauded the Government or Otherwise Submitted a False Claim?

Qui tam laws are extremely complex. If you think your employer has committed fraud or falsity in connection with a government contract, you should contact an experienced attorney to advise you on how you should proceed with filing a qui tam case, or if you have any other options.

FMLA Protects Employees Who Take Their Loved Ones on End-Of-Life Trips

The federal Family and Medical Leave Act (FMLA) traditionally gives covered employees the right to take up to 12 weeks of unpaid leave to care for a family member such as a spouse, child, or parent, if the family member has a serious health condition. 29 U.S.C. § 2612(a)(1)(C). What qualifies as “caring for” a family member is not always clear, however. As we reported in 2014, in a win for employees, the Seventh Circuit Court of Appeals in Ballard v. Chicago Park Dist., 741 F.3d 838, 843 (7th Cir. 2014), ruled that taking a terminally ill loved one on an end-of-life trip qualifies as “caring for” a family member, and accordingly, is protected leave under the FMLA.

Beverly Ballard was fired from her job with the Chicago Park District after she took her terminally ill mother on an end-of-life trip to Las Vegas. Ballard v. Chicago Park Dist., 900 F. Supp. 2d 804 (N.D. Ill. 2012). It was undisputed that Ballard cared for her mother at their home in Chicago. Ballard was her mother’s primary caregiver, and was responsible for feeding and bathing her mother, as well as administering her medication.

In the district court proceedings, Defendant Chicago Park District argued that the FMLA did not protect Ballard’s trip to Las Vegas because the trip was not related to an ongoing course of medical treatment. The district court disagreed, denying defendant’s motion for summary judgment, and finding that “[s]o long as the employee provides ‘care’ to the family member, where the care takes place has no bearing on whether the employee receives FMLA protections.”

The Seventh Circuit affirmed the district court’s decision. The Seventh Circuit noted that on its face, the FMLA provision at issue refers to “care” of a family member, and not “treatment.” Furthermore, the Seventh Circuit held that the FMLA does not restrict care of a family member to care given at home. The Court found that Ballard continued to provide her mother with her basic medical, hygienic, and nutritional needs while visiting Las Vegas, and noted that due to an emergency at the hotel,

Ballard was required to find her mother another source of insulin and pain medication. Accordingly, the FMLA protected Ballard’s trip to Las Vegas.

Ballard remains one of the most useful decisions to support the proposition that “care” leave pursuant to the FMLA is not limited to care provided while seeking medical treatment so long as the employee is providing some form of active physical care (i.e. medical, hygienic, nutritional) related to a family member’s serious health condition. It also remains strong authority for the proposition that such care, to qualify under the FMLA, need not be geographically limited to one’s home or doctor’s office. In other words, taking FMLA leave to “care” for a loved one does not mean you both go into lockdown in your home, and only see the light of day when you need to go to the doctor’s office.

A recent decision (from a district court within the Fourth Circuit) again highlights the fact that the FMLA has no geographic limits. In Meyer v. Town of Wake Forest, Case No. 5:16-CV-348-FL, 2018 U.S. Dist. LEXIS 167130 (E.D.N.C. Sept. 28, 2018), the plaintiff had FMLA leave approved both to care for his spouse’s serious health condition, and also to care for their newborn baby. During his FMLA leave, among other things, Plaintiff took his wife and child on trips to the beach and the state fair. The employer argued FMLA leave does not cover these trips, i.e. that there is a geographical limitation to FMLA protected activities. Id. at *20. The Court also noted the absence of any geographical limitation in the text of the FMLA on activities when caring for a spouse with a serious health condition. The Meyer court, however, declined to resolve the issue formally, noting that Plaintiff had also been approved to care for his newborn (who was also on the trips), and that such leave is clearly not geographically restricted.

Even after Ballard and Meyer, however, employees should still give careful thought before attempting to combine FMLA leave to care for a relative with travel. For example, in a recent case in the Northern District of California, an employee was not even able to take FMLA for the time in which the employee traveled from work to the location of the ill relative. The rationale for the court’s decision was that, during the drive, the employee was not “caring” for the relative. See Aguirre v. California,

Case No. 16-cv-05564-HSG, 2019 U.S. Dist. LEXIS 129752, at *10-*11 (N.D. Cal. Aug. 2, 2019).

So, hearkening back to Ballard, employees should be aware that if you take your ill relative to Las Vegas, you may still face a challenge by your employer if you are found spending large portions of the day alone on the casino floor, or driving solo up and down the Strip.

To schedule your free initial consultation, contact us online or call (619) 342-8000 today!

Californians Can Fight Back Against Unsolicited Commercial Emails

Dreaded spam emails are saturating our inboxes. Unfortunately, there is not an easy way to stop or get rid of the flood of unsolicited commercial emails. Despite Bill Gates famously saying in 2004 that “two years from now, spam will be solved,” 16 years later technology has failed to stop the influx of unsolicited commercial emails.

Fortunately, California has created a way for consumers to fight back with its “Anti-Spam” law (California Business & Professions Code §§17529.2, et seq.). California has made it unlawful for any person or entity to send “unsolicited commercial e-mail” advertisements from California and/or to a California email address. It is similarly unlawful for any person or entity to collect email addresses posted on the internet for purposes of unsolicited commercial email advertisements.

If you are a recipient of an unsolicited commercial email in California, you are entitled to seek $1,000 for each unsolicited commercial email advertisement.

If you are a recipient of an unsolicited commercial email in California, and you would like to know more information about your rights, contact the attorneys at Haeggquist & Eck, LLP. The attorneys offer free case evaluations and if they take your case, they will represent you on a contingency fee basis. That means you don’t pay them anything unless they win.

To schedule your free initial consultation, contact us online or call (619) 342-8000 today!

More Time For Adult Survivors of Child Sexual Assault To Sue

California has passed a new law extending the statute of limitations for cases of alleged childhood sexual abuse. This is incredibly important both for survivors of child sexual assault and for the protection of California’s children. Authored by Assemblywoman Lorena Gonzalez of San Diego and signed by Governor Gavin Newsom, as of Jan. 1, 2020, adults have until at least their 40th birthday to file claims against people and institutions they seek to hold responsible for sexual molestation or sexual assault they experienced as children. See Code of Civil Procedure §340.1. Before this new law, survivors had until their 26th birthday to file suit.

The law also opens up a three-year window for the revival of any claims that would have been barred by the statute of limitations. In addition, the law provides for added penalties (treble damages) against employers or organizations that covered up childhood sexual abuse. As has been well documented with the Catholic Church and Boy Scouts of America, institutions have been criticized for moving predators around from one place to another to avoid accountability.

Data suggests that survivors of childhood sexual abuse often do not tell anyone about the abuse until they are well into their adulthood. Survivors can help protect today’s children by ensuring that what happened to them doesn’t happen to another child.

If the sexual assault happened after the victim’s 18th birthday, the time to file a lawsuit for sexual assault was extended last year to up to ten years after the assault or three years after the injury was discovered, whichever is later. See Code of Civil Procedure §340.16.

Haeggquist & Eck, LLP represents brave survivors of sexual assault and sexual harassment. Contact us online or call us at (619) 342-8000 to speak with one of our attorneys.

Strikes Ratchet Up During COVID-19 – Essential Workers Are ‘Doing It For Themselves,’ As the Song Goes

Our nation is witnessing what may be the start of a tidal wave of workers going on strike, particularly in “essential” businesses such as the grocery and delivery industries. Since at least March 27, 2020, news headlines have exploded with reports of actual or threatened strikes (or “sick outs”) by workers at Amazon, Whole Foods (owned by Amazon), and Instacart. These workers are demanding a host of protections and benefits, including hazard pay, increased safety protections, and other work condition improvements.

Who can blame these workers for striking? While most Americans stay home to “shelter in place”, these workers are suffering through unbelievably long hours, often spent in confined areas, and with little employer-provided health protections or sanitization efforts to guard against the COVID-19 virus. These workers are seeing fellow employees becoming infected with COVID-19, yet they are expected to continue to place themselves in harm’s way, with no appreciation of the risk they are taking to their lives. They are truly in the “trenches” of the war to help keep Americans fed.

Fortunately, the workers are not without some governmental support. On March 25, 2020, fifteen states Attorneys General wrote to Amazon and Whole Foods to ask that these businesses pay heed to the guidance of the Centers for Disease Control, and to adopt standards akin to those in the Families First Coronavirus Response Act.

Similarly, during California Governor Newsom’s March 31, 2020 public update on the COVID-19 pandemic, he relayed a conversation with John Grant, the head of the United Food & Commercial Workers (“UFCW”) Local 770 in the Los Angeles area (the “UFCW Local 770”), about the plight of grocery workers. As summarized by Newsom, essential workers in the grocery stores are also on the “front line” just like workers in the medical field.

UFCW Local 770 has started a petition for Newsom to enforce protections for these essential workers. The petition asks the State of California to “designate essential retail workers as emergency frontline personnel” and to provide increased sanitary protections (including personal protection equipment (PPE), among other benefits.

Ultimately, it is in everyone’s best interests to protect all workers, and especially those in “essential” jobs at this critical time. As one news report wisely questioned: “What will happen if a combination of labor unrest and risk of infection shuts down the same delivery platforms and retail avenues that people are relying on to get through the crisis as they self-quarantine?” As the saying goes, we are all in this together. Protecting employee rights protects everyone.

Sadly, one striking Amazon worker was reportedly fired for participating in a New York strike effort. The President of the Retail, Wholesale and Department Store Union is cited as called the firing “unacceptable”. New York’s Attorney General and the Mayor of the City of New York are reportedly calling for investigations into the alleged firing. We trust that employers will think twice before further harming employees for seeking improved work conditions.

We encourage both employers and employees to consider all current guidance offered by federal and state regulatory authorities concerning workplace safety at all times, but especially during COVID-19. Recent informative guidance may be readily located on the CDC’s, and California’s website. Finally, while employees will need to consider their particular employment situation (i.e., are they a union member; are they subject to a collective bargaining agreement; etc.), the National Labor Relations Board (the “NLRB”) also has useful online guidance concerning strike rights in various situations. Right to strike laws can be complex and vary based on several factors. We encourage employees to consult with counsel before undertaking any strike or “sick out.”

At Haeggquiest & Eck, LLP, also welcome any employees – particularly those in jobs deemed “essential” – who have concerns about their working conditions to contact us online or by calling (619) 342-8000 for assistance.

Haeggquist & Eck Announces Consumer Fraud Class Action Into Houseware Giant Williams-Sonoma

Case Alleges Williams-Sonoma Inflated and Knowingly Misrepresented Thread Count of  Luxury Bedding Collections

SAN DIEGO, Calif. – San Diego employee and consumer rights litigation firm Haeggquist & Eck has joined attorneys from Rose Law Group, P.C. in Phoenix and Baker Law P.C. in Los Angeles in prosecuting a class action lawsuit alleging housewares giant William-Sonoma illegally inflated the thread count of its luxury bedding collections sold across the company’s family of brands.

The case, Rushing v. Williams-Sonomawhich is styled as a class action and currently pending in the United States District Court for the Northern District of California, alleges that Williams-Sonoma Inc. and several of its marketing and advertising subsidiaries knowingly misrepresented thread counts on the packaging of several of the company’s products, some by as many as 300 threads.  The case alleges a litany of misleading and deceptive advertising and other consumer-protection claims, including violations of the California Consumer Legal Remedies Act and California laws pertaining to untrue advertising, unfair competition, unlawful and fraudulent business practices, and unjust enrichment.

It involves the following bedding – including bed sheets, pillowcases, shams, and duvets – sold by Williams-Sonoma and its family of brands:

  • Williams-Sonoma Home Signature 600-Thread-Count Sateen Bedding
  • Williams-Sonoma Home Greek Key Jacquard 600-Thread-Count Bedding
  • Williams-Sonoma Home Suzani Jacquard Bedding (500 TC)
  • Pottery Barn Foundations Hotel Sateen Bedding (600 TC)
  • Pottery Barn Banded Hemstitch Bedding (400 TC)
  • Pottery Barn Morgan 400-Thread-Count Bedding
  • Pottery Barn PB Organic 400-Thread-Count Bedding
  • Pottery Barn PB Classic 400-Thread-Count Bedding

“Nobody would expect that WSI would advertise 600 thread count bedding that does not, in fact, contain 600 threads per square inch as indicated on the label,” the operative Complaint reads.  “But that is exactly what WSI is doing.”

The Complaint alleges that WSI relies upon its’ brands established reputations as high-end retailers to pass off interior products to consumers and to deceive them into believing its representations about the thread count of its bedding offerings.

“They market to affluent and aspiring consumers who are willing to pay a premium price for a premium product,” the Complaint states. “But what WSI advertises is not necessarily what it delivers, particularly when it comes to its bedding products.”

Williams-Sonoma is publicly traded on the New York Stock Exchange and operates through trademarks including Williams-Sonoma, Williams-Sonoma Home, Pottery Barn, Pottery Barn Kids, Pottery Barn Baby, PB Teen, PB Dorm, West Elm, Mark & Graham, and Rejuvenation.

What You Can Do

Potential class members who have purchased any of the Williams-Sonoma bedding products advertised as having a thread count of 350 or higher from Williams-Sonoma or any of the stores or brands listed above may contact attorney Amber Eck at (619) 342-8000 to learn more about the claims alleged and their rights to seek compensation for damages they may have suffered.

In addition, consumers who have purchased bedding from Williams-Sonoma advertised as having a thread count of 350 and higher are encouraged to contact Amber Eck to learn more about their potential claims.

About Haeggquist & Eck, LLP

Haeggquist & Eck, LLP is a full-service law firm that brings major class actions nationwide on behalf of defrauded consumers, investors and employees.

To schedule your free initial consultation, contact us online or call (619) 342-8000 today!

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