T. S. Ellis, III, United States District Judge.
Relator in this False Claims Act
Unisys filed a motion to dismiss relator's Amended Complaint for lack of jurisdiction and for failure to state a claim under Rules 12(b)(1) and 12(b)(6), Fed. R. Civ. P., arguing that Count I fails to state a claim for relief and that Count II (i) is precluded by the FCA's first-to-file jurisdictional bar, (ii) is barred by res judicata, and (iii) fails to state a claim for relief. The motion was fully briefed and argued. For the reasons that follow, the motion must be granted and the Amended Complaint must be dismissed.
The pertinent facts may be succinctly stated.
The first CLINs relevant to this action are CLINs 1 and 2. Under both of these CLINs, employees known as field service engineers were responsible for installing RFID sites and maintaining the operational readiness of these sites. The key difference between CLIN 1 and CLIN 2 was geographic, namely that field service engineers within the continental United States operated under CLIN 1 while field service engineers outside of the continental United States operated under CLIN 2. In Count I, relator alleges that Unisys routinely hired unqualified personnel to work as field service engineers under CLINs 1 and 2 and that these employees, as a result of their lack of qualifications, rendered services that were of no value to the United States. Thus, relator alleges that any claim
The third relevant CLIN is CLIN 4, under which software engineers provided development and support services for RFID sites. Development services were to be billed under sub-CLIN 4-AA, while support services were to be billed under sub-CLIN 4-AB. Count II of the Amended Complaint alleges that Unisys submitted to the United States fraudulent invoices that falsely reported the amount of work performed under each sub-CLIN. Specifically, relator alleges that rather than report the hours employees actually worked, Unisys reported hours according to a predetermined formula: 70% of labor was reported under sub-CLIN 4-AA and 30% under sub-CLIN 4-AB. This formula mirrored Unisys's contract bid to obtain TO 122, which had proposed that 70% of labor under CLIN 4 would be allocated to sub-CLIN 4-AA, which used a fixed fee payment model, and 30% of the labor would be allocated to sub-CLIN 4-AB, which used a time and materials payment model. The Amended Complaint alleges that once performance on the contract was underway, Unisys realized that in practice less than 30% of the labor under CLIN 4 was actually for AB-qualifying work and that because of the time and materials billing model under sub-CLIN 4-AB, if Unisys did not bill 30% of labor under sub-CLIN 4-AB, then Unisys would in effect be leaving money on the table. Thus, the Amended Complaint alleges that in order to capture the full amount of money that the federal government allocated for AB payments, Unisys misrepresented labor hours that should have been billed under sub-CLIN 4-AA as labor hours under sub-CLIN 4-AB. In other words, the Amended Complaint alleges that Unisys instructed its CLIN 4 software engineers to bill their work as 70% AA and 30% AB, regardless whether this ratio accurately reflected the labor allocation, which had the effect of billing the government for more CLIN 4-AB work than Unisys actually performed. This billing scheme allegedly lasted from April 2008 until October 2011.
Importantly, this is not the first FCA lawsuit to allege that Unisys committed fraud under TO 122. In United States ex rel Saunders v. Unisys, No. 12-cv-379 (E.D.Va.) ("Saunders"), the various complaints alleged a billing scheme similar to the one alleged here with respect to CLIN 4, the difference being that the relator in Saunders alleged that the scheme occurred under CLINs 1 and 2. Indeed, the Saunders Second Amended Complaint ("SAC") alleged that Unisys "bill[ed] [time and materials] work according to predetermined percentages regardless of the work performed despite the fact that [time and materials] is only supposed to be billed for actual time accrued." See Saunders SAC (D. Mem. Supp., Ex. C), ¶ 96. Thus, as with the fraudulent invoicing allegation in Count II of this lawsuit, the Saunders SAC alleged that Unisys engaged in a fraudulent scheme to manipulate its billing to conform to the bid model submitted to win TO 122. See id. ¶¶ 20-21, 24, 43. According to the Saunders SAC, the billing scheme under CLINs 1 and 2 lasted from approximately April 2008 until October 7, 2010. Id. ¶¶ 54-55, 61, 70.
In December 2014, Saunders, Unisys, and the United States reached a settlement agreement by which the United States released Unisys from FCA liability for "Covered Conduct," which the Settlement Agreement defined as the fraudulent billing scheme under CLINs 1 and 2. See Settlement Agreement (D. Mem. Supp., Ex. D), ¶¶ R-4, 3. In light of the Settlement Agreement, the parties dismissed Saunders with prejudice on December 26, 2014. See Stipulation of Dismissal (D.
Count I of the Amended Complaint alleges a worthless services claim related to CLINs 1 and 2, in essence alleging that certain field service engineers under CLINs 1 and 2 were so unqualified that their work was worth nothing. Unisys, citing the now-familiar Iqbal-Twombly decisions,
Although the FCA imposes liability for claiming payment from the United States for a worthless service, courts routinely recognize that a relator can bring a worthless services claim only if "the performance of the service is so deficient that for all practical purposes it is the equivalent of no performance at all." United States ex rel Davis v. U.S. Training Center, Inc., 498 Fed.Appx. 308, 315 n. 11 (4th Cir.2012) (quoting Mikes v. Straus, 274 F.3d 687, 703 (2d Cir.2001)) (internal quotations omitted).
Analysis of a worthless service claim must begin by identifying the "service" at issue. The Amended Complaint indicates that under the relevant CLINs the government was paying for the installation and maintenance of RFID sites. Thus, the proper analytical focus for assessing the claim is whether such RFID sites were installed and maintained in a manner that provided some value to the federal government. Instructive precedent from other circuits teaches and confirms that the analysis of a worthless service claim must focus on the precise service for which the government is paying. See Chesbrough, 655 F.3d at 468 (focusing on specific medical tests); United States ex rel. Lee v. SmithKline Beecham, Inc., 245 F.3d 1048, 1053 (9th Cir.2001) (focusing on specific laboratory test data). To be sure, where the service provided is worthless to the government, it necessarily follows that the employee work hours expended to provide the service are also worthless to the government — time spent providing something of no value is time wasted. Yet, it does not follow that where a few worthless
Given the foregoing, it is pellucid that the Amended Complaint fails to state a claim for worthless services. With regard to the installation and maintenance of the RFID sites, the Amended Complaint alleges that "[t]he consequence of Unisys' hiring unqualified engineers was that the ... team performed well below expectations," not that the team did not perform at all. Am. Comp. ¶ 19. To the contrary, the work under the contract was apparently performed well enough that the United States Army never discovered the unqualified employees "because a small number of employees who were actually qualified were bearing the brunt of the work." Id. ¶ 20. In other words, the Amended Complaint concedes that RFID sites were being installed and maintained, but alleges that the services were performed at a level below the value the government was paying under TO 122 because certain employees were unqualified and therefore did not pull their weight. In this respect, relator bases his worthless services claim on services that were merely "worth less" than what the government paid. Such a theory is insufficient to state a claim for relief under the FCA. Cf. Absher, 764 F.3d at 710 ("Services that are `worth less' are not `worthless.'"). To conclude otherwise would inappropriately transform a "dispute involving contractual performance ... into a qui tam FCA suit." United States ex rel Wilson v. Kellogg Brown & Root, Inc., 525 F.3d 370, 373 (4th Cir. 2008).
Relator argues that because CLINs 1 and 2 contained time and materials billing arrangements, the result should somehow be different. This is incorrect. To be sure, if the Amended Complaint alleged that certain employees performed no work but nevertheless billed time under sub-CLINs 1-AB and 2-AB, then a valid FCA claim for fraudulent invoicing might exist. But that is not what the Amended Complaint alleges in Count I. Instead, the Amended Complaint recognizes that the allegedly worthless employees were working, but simply argues that they added no value. See, e.g., Am. Comp. ¶ 14 ("Unisys routinely hired non-qualified individuals so that it could bill their labor hours."). Simply put, the Amended Complaint does not suggest that the allegedly unqualified employees were just sitting idly all day.
At its core, relator's theory is that Unisys is liable for fraud because it hired certain employees who did not pull their weight, who made the RFID teams less efficient, and who decreased the overall value of the teams working under CLINs 1 and 2. Yet, the government still received the services for which it paid, namely the installation and maintenance of RFID sites. Although the government may well have gotten more bang for its buck if all CLIN 1 and 2 employees had been well qualified, the employment of unqualified persons under CLINs 1 and 2 merely rendered the overall work "worth less," not "worthless." See Absher, 764 F.3d at 710 ("Services that are `worth less' are not `worthless.'"). Because relator's allegations in Count I of the Amended Complaint fail to state a claim for worthless services liability, and because relator's proffered facts in support of leave to amend similarly fall short of stating a viable worthless services claim, Count I must be dismissed with prejudice.
In Count II, the Amended Complaint advances a fraudulent invoicing theory, alleging that Unisys fraudulently submitted invoices that did not accurately reflect the work performed under CLIN 4, thereby causing the United States to overpay. Unisys seeks dismissal of this claim on three grounds: (i) that there is no subject matter jurisdiction under § 3730(b)(5), (ii) that the claim is barred by res judicata, and (iii) that Count II is insufficiently pled. For the reasons that follow, there is no subject matter jurisdiction over Count II, and Count II must be dismissed without prejudice to refiling a new lawsuit. For the sake of completeness, Unisys's res judicata argument is considered in the alternative. Given the results reached on these issues, it is unnecessary to address the sufficiency of the allegations.
Because it is well settled "that Article III generally requires a federal court to satisfy itself of its jurisdiction over the subject matter before it considers the merits of a case," Unisys's jurisdictional challenge is appropriately addressed first. Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583, 119 S.Ct. 1563, 143 L.Ed.2d 760 (1999). Under § 3730(b)(5), known as the first-to-file bar, "[w]hen a person brings an action under [the FCA], no person other than the Government may ... bring a related action based on the facts underlying the pending action." This provision is jurisdictional. See United States ex rel. Carter v. Halliburton Co., 710 F.3d 171, 181 (4th Cir.2013) ("[I]f an action is later filed that is based on the facts underlying [a] pending case, the court must dismiss the later case for lack of jurisdiction."). Importantly, the Supreme Court has recently reaffirmed
The jurisdictional analysis under § 3730(b)(5) is governed by the "material elements test." Carter, 710 F.3d at 182. Under this test, "a later suit is barred if it is based upon the `same material elements of fraud' as the earlier suit" even though the later suit may not involve identical facts and details. See id. Notably, the goal of the material elements test is to prevent less vigilant whistleblowers from using immaterial factual variations to allege fraudulent activity already known to the government. See id. Thus, where the allegations of fraud in an earlier suit "provide the government with enough knowledge of essential facts of the scheme to discover related fraud," actions on the related fraud are barred. See id.
Unisys correctly argues that Count II is barred because it was filed while Saunders was pending. As the Supreme Court recently held, as used in § 3730(b)(5) "[t]he term `pending' means `[r]emaining undecided; awaiting decision.'" Kellogg, 135 S.Ct. at 1978. Under this definition, Saunders was "pending" between April 6, 2012, when the original Complaint was filed, and December 26, 2014, when the parties filed a stipulation of dismissal. Relator filed the instant lawsuit in that timeframe, specifically on September 16, 2014. Yet, the parties dispute whether the allegations in Saunders were based on the same material elements of fraud as the instant lawsuit. In Unisys's view, the evolution of the allegations over the course of the Saunders litigation establish that the government was aware of the fraud asserted here in Count II. Relator, in turn, argues that when the instant action was initiated, the Saunders SAC alleged a fraudulent scheme different from the scheme alleged here, which bars the application of § 3730(b)(5).
Relator first argues that because the fraudulent scheme alleged in the Saunders SAC is different from the scheme alleged here in Count II, § 3730(b)(5) does not bar Count II. As relator explains, the scheme alleged in Count II of this action is simple: Unisys engaged in time-card fraud in order to maximize the number of hours billed under CLIN 4-AB, which resulted in Unisys's charging the government for more time and materials work than Unisys actually provided. In contrast, the fundamental purpose of the time-card scheme alleged in the Saunders SAC was to shift billing from the AB sub-CLINs to the AA sub-CLINs so as to prevent the contracting
This argument, which is based on the distinction between the type of fraud alleged, is unpersuasive. To begin with, a focus on the theory of fraud is inconsistent with the statutory language of § 3730(b)(5), which expressly focuses on "the facts," not the legal theory. Moreover, relator cites no authority for the proposition that the material elements test focuses on distinctions as to the theory of the fraud rather than the facts of the fraud. Indeed, it is difficult to see how the "material elements of fraud" that constitute the focus of the material elements test can be anything other than the factual bases for the fraud. After all, to speak of the "elements" of fraud is to speak of factual matters, namely (i) a material misrepresentation, (ii) scienter, (iii) reliance, and (iv) resulting harm. See United States ex rel Owens v. First Kuwaiti Gen. Trading & Contracting Co., 612 F.3d 724, 729 (4th Cir.2010) (stating the elements of an FCA claim). Further, a focus on the theory of fraud rather than the facts of fraud would deprive § 3730(b)(5) of much of its force because one set of facts can often give rise to multiple theories of fraud. See, e.g., Lee, 245 F.3d at 1053 (observing that a common set of facts could support either a false certification or worthless services claim). Thus, a difference in the scheme alleged is insufficient to avoid § 3730(b)(5)'s subject matter jurisdiction bar. As the text of the provision makes clear and as the provision's underlying purpose requires, the focus must be on the commonality of the facts in the earlier and later cases.
Relator next argues that Count II does not arise from the same facts as the Saunders complaints. In this respect, relator emphasizes three distinctions between Count II and the Saunders SAC. First, the CLINs at issue are different, and Unisys's scheme under CLIN 4 involved overcharging the government whereas Unisys's scheme under CLINs 1 and 2 involved the failure to disclose cost data to the contracting officer. Second, noting that under the material elements test "an examination of possible recovery ... aids in the determination of whether the later-filed complaint alleges a different type of wrongdoing on new and different material facts,"
Relator's factual arguments fail to persuade. At the most basic level, the allegations in Saunders and in Count II of the instant action allege a time-card scheme by which Unisys sought to maximize its billing under AB sub-CLINs.
Relator's argument that the allegations in Saunders do not encompass the allegations in Count II here — such that the Saunders complaints did not allege a systematic practice of overbilling — similarly fails. In the original Saunders Complaint, the relator alleged broadly that
Saunders Comp. ¶ 3. Thus, the original Saunders Complaint contained at least one allegation suggesting that the time-card scheme was occurring throughout TO 122. Although relator is correct that the allegations in Saunders subsequently focused exclusively on CLINs 1 and 2, the operative question is whether any allegation "provid[ed] the government with enough knowledge of essential facts of the scheme to discover related fraud." Carter, 710 F.3d at 182. And as the Seventh Circuit has observed in applying § 3730(b)(5), "[t]he allegations ... are what they are." Chovanec, 606 F.3d at 365. In light of the general allegation of time-card fraud under TO 122 and the specific allegations that this fraud was occurring under at least two separate CLINs, the government had sufficient information to make a further investigation into fraud under other CLINs "likely," which Carter teaches is sufficient to trigger the § 3730(b)(5) jurisdictional bar. See 710 F.3d at 182. Simply put, the allegations in Count II of the instant action are encompassed in the broad allegation in Paragraph 3 of the Saunders Complaint, and the specific allegations of fraud under CLINs 1 and 2 were sufficient to tip off
Relator's final factual argument — that relator does not stand to recover for fraud for which Saunders already recovered — does not alter the analysis. As relator's own cited authority makes clear, "an examination of possible recovery merely aids" in the material elements test analysis. Ortega, 240 F.Supp.2d at 13 (emphasis added). And as Ortega recognizes,
Id. For the reasons already discussed, the original Saunders Complaint alleged a sufficiently broad scheme to inform the government of possible fraud under CLIN 4. Thus, even though Saunders ultimately focused only on the fraud under CLINs 1 and 2, the fact that Saunders's potential recovery may have been limited does not overcome the fact that the government knew enough information to discover the related fraud alleged in Count II here.
In a final attempt to save Count II from dismissal under § 3730(b)(5), relator argues that by filing an Amended Complaint after Saunders was no longer pending, he has cured any jurisdictional defect. Relator's argument in this regard fails for two reasons. In part, relator's argument conflates a facial challenge to subject matter jurisdiction on the one hand and a factual challenge on the other. Moreover, portions of relator's argument are foreclosed by controlling Fourth Circuit authority.
As the Fourth Circuit has explained, "a defendant may challenge subject matter jurisdiction in one of two ways." Kerns v. United States, 585 F.3d 187, 192 (4th Cir.2009). In a facial challenge, the defendant argues that the facts as alleged in the complaint fail to establish a basis for subject matter jurisdiction. See id. In a factual challenge, the defendant attacks the truth of the factual predicate of subject matter jurisdiction. See id. The jurisdictional challenge presented here is factual, not facial. Accord United States ex rel. Palmieri v. Alpharma, Inc., 928 F.Supp.2d 840, 848 (D.Md.2013) (treating a § 3730(b)(5) challenge as factual). As the plain language of § 3730(b)(5) makes clear, a person may not "bring" an "action" while a factually related action is "pending." Whether an action is brought in contravention of § 3730(b)(5) is a question of fact. As already discussed, Saunders was a related
Relator's cited authorities do not compel a contrary conclusion. Relator cites Rockwell Int'l Corp. v. United States, 549 U.S. 457, 473-74, 127 S.Ct. 1397, 167 L.Ed.2d 190 (2007), for the proposition that "when a plaintiff files a complaint in federal court and then voluntarily amends the complaint, courts look to the amended complaint to determine jurisdiction." Yet, Rockwell is inapposite here; the cited rule applies to facial subject matter jurisdiction challenges, not factual subject matter jurisdiction challenges. See id. at 473, 127 S.Ct. 1397. Indeed, Rockwell was clearly a facial jurisdictional challenge. See id. (acknowledging that in Rockwell jurisdiction turned on "the relator's allegations"). Moreover, "Rockwell demonstrates that a plaintiff may amend himself or herself out of jurisdiction by withdrawing allegations that appeared in the original complaint, but did not state that a court may acquire jurisdiction through amendment." Carter, 144 F.Supp.3d at 882, 2015 WL 7012542, at *12 (internal quotations omitted). Here, the jurisdictional defect is not that relator failed to allege facts creating a basis for jurisdiction, but that relator — as a matter of fact — commenced his lawsuit while Saunders was pending. In sum, Rockwell does not apply here.
Relator next cites the First Circuit's decision in United States ex rel Gadbois v. PharMerica Corp., 809 F.3d 1 (1st Cir. 2015). In Gadbois, the relator filed a lawsuit that was barred by § 3730(b)(5) because it was based on facts materially indistinguishable from those in a pending lawsuit in Wisconsin. Id. at 3. While the case was on appeal from the district court's dismissal, the pending action in Wisconsin was settled and dismissed. Id. at 4. Thus, the relator sought a remand with leave to file a pleading under Rule 15(d), Fed. R. Civ. P., which would supplement the complaint with the additional fact that the Wisconsin action was no longer pending. Id. The First Circuit vacated and remanded to allow the relator to move before the district court for leave to file a Rule 15(d) pleading. In so deciding, the First Circuit held that such a supplemental pleading would be sufficient to cure the jurisdictional defect under § 3730(b)(5). In light of Gadbois, relator argues that his Amended Complaint, filed in February 2016, cures any jurisdictional defect under § 3730(b)(5) because the Amended Complaint was filed well after the dismissal of Saunders.
Gadbois cannot control here, however, because its reasoning is in tension with controlling Fourth Circuit authority. Specifically, Gadbois reasoned that the "venerable rule" that subject matter jurisdiction is determined based on whether it existed at the time the plaintiff filed the original complaint "is inapposite to the federal question context" unless there is some allegation
Even assuming, arguendo, that the foregoing analysis is incorrect, Gadbois is, in any event, unpersuasive as it relies on distinguishable cases while failing to adhere to the plain text of § 3730(b)(5),
Importantly, administrative exhaustion requirements serve a specific purpose: by channeling claims through an administrative process in the first instance, interested parties obtain notice of the claims and have the potential to resolve disputes more quickly and inexpensively than may typically be accomplished through litigation. See, e.g., Sydnor v. Fairfax Cnty., 681 F.3d 591, 593 (4th Cir. 2012) (discussing the role of administrative exhaustion in the employment discrimination context). In sharp contrast, § 3730(b)(5) serves an entirely different purpose, namely "to prevent parasitic lawsuits based on previously disclosed fraud." Carter, 710 F.3d at 181 (emphasis added).
Finally, relator argues as a matter of policy that treating the Amended Complaint as a supplemental pleading that overcomes the jurisdictional bar will promote efficiency. As the Supreme Court held in Kellogg, 135 S.Ct. at 1979, because a case ceases to be "pending" once decided or dismissed, a dismissal under the first-to-file bar must be without prejudice to refiling once the earlier action is no longer pending. Thus, the practical effect of dismissing Count II is simply that relator must re-file his lawsuit as a new action. Indeed, Gadbois described dismissal in an analogous situation as "a pointless formality" that "would needlessly expose the relator to the vagaries of filing a new action." 809 F.3d at 6. In Kellogg, however, the Supreme Court conceded that although there was "merit" to the argument that strict adherence to the plain language of § 3730(b)(5) "would produce practical problems," such concerns could not alter the statutory analysis. 135 S.Ct. at 1977. The same is true here. No doubt it would be more efficient to allow a jurisdictionally barred action to be saved by supplementation or amendment once the bar is removed, but to do so would be to ignore the language Congress enacted and the purpose Congress sought to achieve.
Thus, Count II must be dismissed without prejudice under § 3730(b)(5). Because an amendment cannot cure the jurisdictional fact that this action commenced during the pendency of a factually related case, leave to amend must be denied as futile. Nevertheless, Count II may be refiled as a new action, consistent with Kellogg.
Although the conclusion that the first-to-file bar precludes the assertion of Count II in this action is sufficient to resolve the instant motion, it is worth considering Unisys's res judicata argument, but only in the alternative.
In light of the foregoing, the only disputed issue with respect to res judicata is whether the claim in Count II shares an identity with the cause of action resolved by stipulated dismissal in Saunders. In the Fourth Circuit, "the traditional res judicata inquiry is modified in cases where the earlier action was dismissed in accordance with a release or other settlement agreement." Id. at 913. Specifically, "given the contractual nature of ... settlement agreements, the preclusive effect of a judgment based on such an agreement can be no greater than the preclusive effect of the agreement itself." Id. Thus, a judgment that rests on an agreement should be given effect according to the intention of the parties as understood under ordinary principles of contract law. See id. In Unisys's view, the Saunders Settlement Agreement covers all of the conduct alleged in the Saunders SAC, which Unisys further argues shares a nucleus of operative facts with the instant action such that res judicata applies to the whole of Count II. Relator, in turn, argues that the Saunders Settlement Agreement covers only the fraudulent billing schemes committed under CLINs 1 and 2.
Under the terms of the Saunders Settlement Agreement, the United States released Unisys from FCA liability only for "Covered Conduct." The Settlement Agreement defines "Covered Conduct" as "[t]he conduct alleged in the Second Amended Complaint and summarized" as "regarding Contract Line Item Numbers (CLINs) 0001 and 0002 of Task Order ("TO") 122." See Settlement Agreement, ¶ R-4. As such, relator argues that by focusing on the allegedly fraudulent scheme under CLINs 1 and 2, the Saunders Settlement Agreement manifests the parties' intent to cover only the conduct related to those CLINs. This argument, however, does not account for the nature of FCA liability. As the Fourth Circuit has explained, the FCA "attaches liability, not
But this does not end the analysis. As the Settlement Agreement makes clear, the claims for which the United States released Unisys from FCA liability were submitted beginning on March 11, 2008, and ending on October 7, 2010. See Settlement Agreement, ¶ R-4. In the Amended Complaint, however, relator alleges that false claims for payment under CLIN 4 were submitted between April 2008 and October 2011. See Am. Comp. ¶ 79. Thus, relator alleges that Unisys submitted false claims under CLIN 4 for an entire year beyond the Covered Conduct in the Saunders Settlement Agreement. Because these November 2010 through October 2011 false claims do not contain CLIN 1 or 2 fraud, they do not relate to the claims for which Unisys was released from liability, and res judicata does not bar suit on these claims.
Perhaps in anticipation of this result, Unisys notes that the Settlement Agreement was not incorporated into the dismissal order and is therefore not part of
Accordingly, in the event the analysis under § 3730(b)(5) is incorrect and subject matter jurisdiction exists, then res judicata would operate, but only to bar suit on those claims for payment that contained false statements as to both (i) CLIN 4 and (ii) either or both of CLIN 1 or CLIN 2. Thus, even if subject matter jurisdiction existed as to Count II, it would be appropriate to dismiss Count II with prejudice to the extent that it alleges liability for invoices submitted between March 11, 2008, and October 7, 2010.
For the foregoing reasons, Unisys's motion to dismiss must be granted. Count I must be dismissed with prejudice for failure to state a claim for worthless services, with leave to amend denied on the ground of futility because relator's proffered facts would not rescue the claim. Count II must be dismissed without prejudice to relator's re-filing the claim as a new FCA action. The res judicata analysis does not warrant dismissing portions of Count II with prejudice because the res judicata analysis applies if and only if the subject matter jurisdiction conclusion is incorrect.
An appropriate Order will issue.