[nfbmi-talk] Fw: are federallaws even enforced?
joe harcz Comcast
joeharcz at comcast.net
Wed Jul 31 13:57:30 UTC 2013
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From: joe harcz Comcast
To: blind democracy List
Sent: Wednesday, July 31, 2013 9:50 AM
Subject: are federallaws even enforced?
^ChEYCORDK,C14E5RKPM
^ERN^TH^ro^CHIGfN UNITED STATES DISTRICT COURT SCANNED
FOR THE WESTERN DISTRICT OF MICHIGAN $' '
UNITED STATES OF AMERICA, ex rel. [UNDER SEAL],
Plaintiffs,
1:11-cv-329
Robert Holmes Bell Civil Action No. y s. District Judge
v.
[UNDER SEAL]
JURY TRIAL DEMANDED
Defendants.
COMPLAINT (FALSE CLAIMS ACT 31 U.S.C. §§ 3729-3733)
CASE FILED IN CAMERA AND UNDER SEAL AS REQUIRED BY 31 U.S.C. $ 3730(b¥2)
SEE ALSO LOCAL RULE 5.7(d¥ii¥c)
UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF MICHIGAN
UNITED STATES OF AMERICA, ex rel. REBECCA OGLE,
5225 Pooks Hill Rd„ #505 North Bethesda, MD 20814,
Plaintiffs,
v.
PECKHAM, INC.,
3510 Capital City Blvd., Lansing, MI 48906-2102,
and
MITCHELL TOMLINSON,
2510 Capital City Blvd., Lansing, MI 48906-2102
Defendants.
FILED UNDER SEAL
Civil Action No.____________
JURY TRIAL DEMANDED
COMPLAINT
This Complaint alleges that Peckham, Inc. ("Peckham") and its CEO Mitchell Tomlinson have violated the False Claims Act, 31 U.S.C. §§ 3729 et seq., through a scheme to win and receive payments under federal contracts for which Peckham is ineligible to compete. The United States Government, through the Javits-Wagner-O'Day ("JWOD") program, sets aside certain contracts for nonprofit agencies that employ persons with severe disabilities. Peckham advertises itself to the Government as such an agency and regularly wins JWOD program contracts. In fact, Peckham's workforce is not substantially composed of severely disabled persons, and Peckham is therefore ineligible to receive funds from the federal Government under the JWOD program. Plaintiff Rebecca Ogle brings this civil action on behalf of and in the name
of the United States of America under the qui tam provisions of the federal False Claims Act, 31 U.S.C. §§3729-3733, and alleges:
JURISDICTION AND VENUE
1. Counts I and II are civil actions by Plaintiff Rebecca Ogle, acting on behalf of and in the name of the United States, against Defendants Peckham, Inc., and Mitchell Tomlinson under the federal False Claims Act, 31 U.S.C. §§ 3729-3733. This Court has jurisdiction pursuant to 28 U.S.C. §§ 1331 and 1345, and 31 U.S.C. § 3732(a).
2. This Court has personal jurisdiction over the Defendants pursuant to 31 U.S.C. § 3732(a), because the Defendants transact substantial business in this judicial district.
3. Venue is proper in this judicial district pursuant to 31 U.S.C. § 3732(a), because the Defendants transact substantial business in this judicial district, and because some of the alleged acts proscribed by 31 U .S.C. § 3729 occurred in this judicial district.
4. The allegations and transactions set forth in this Complaint have not been publicly disclosed through any of the means enumerated in 31 U.S.C. § 3730(e)(4)(A).
5. Rebecca Ogle has direct knowledge of the matters alleged herein, and her knowledge is independent from any allegations or transactions that may have been publicly disclosed through any of the means enumerated in 31 U.S.C. § 3730(e)(4)(A). In an interview on February 25, 2011, Ms. Ogle voluntarily provided the information set forth herein to federal law enforcement agents.
PARTIES
6. Plaintiff Rebecca Ogle ("Relator" or "Plaintiff') is a United States citizen with a residence at 5225 Pooks Hill Rd., #505 North, Bethesda, MD 20814. She has worked in the field of disability policy for more than twenty years, in both the private and public arenas. Ogle
started her own consulting business in March 2009. She currently works with a variety of organizations on employment and disability-rights issues, as well as with private companies that are committed to employing large numbers of disabled workers.
7. Defendant Peckham, Inc. ("Defendant" or "Peckham"), is a non-profit community rehabilitation organization founded in 1976 to provide vocational rehabilitation and competitive employment opportunities to people with disabilities. It is incorporated in Michigan. Its headquarters are located at 3510 Capital City Blvd., Lansing, MI 48906-2102, with several more offices throughout Michigan and Iowa. Peckham operates four primary business lines: supply chain solutions (shipping services), business services (administrative support), environmental services (janitorial and maintenance), and apparel manufacturing. Through the JWOD program, Peckham has been awarded lucrative contracts with numerous government agencies, including several military agencies and the Department of State. Among the contracts Peckham has been awarded based on its status as a community rehabilitation organization are the following: with the Department of the Army, contract no. W911QY09F0214 ($33.8 million), contract no.
W911QY05F0009 ($23.9 million), contract no. W911QY06F0069 ($12.7 million), and contract no. W911QY09F0138 ($ 11.0 million); with the Department of State, contract no. SAQMMA09C0004 ($15.5 million and $12.6 million); and with the Department of the Navy, contract no. M6785410F3050 ($12.4 million).
8. Defendant Mitchell Tomlinson, during all times relevant to the Complaint, has been the CEO of Peckham. Tomlinson has known about and authorized Peckham's conduct that is described in this Complaint, and because Tomlinson is ultimately responsible for Peckham's conduct, he has caused Peckham to engage in this conduct.
THE JWOD PROGRAM
9. The Javits-Wagner-O'Day Act, 41 U.S.C. § 8501 et seq., established a program (the "JWOD" program, also referred to as the "AbilityOne" program) by which the federal government procures certain enumerated goods and services exclusively from non-profit companies, often referred to as Community Rehabilitation Providers ("CRPs"), that serve and employ individuals who are blind or otherwise severely intellectually or physically disabled. The JWOD program is the largest single source of employment for people with severe disabilities in the United States.
10. For purposes of the JWOD program, in order for a person to be considered severely disabled, that person must have a disability that "constitutes a substantial handicap to employment and is of a nature that prevents the individual from currently engaging in normal competitive employment." 41 U.S.C. § 8501(8). Under this definition, a person's status as "severely disabled" takes into account not only the nature of the person's disability, but also the person's work history. The regulations implementing the JWOD Act specifically exempt from eligibility those persons who have overcome the restrictions imposed by their disability and are able to be competitively employed. 41 C.F.R. 51-1.3.
11. The JWOD program is administered by a small, independent federal agency called the Committee for Purchase From People Who Are Blind or Severely Disabled,
sometimes known as the AbilityOne Committee ("the Committee" or "AbilityOne"). AbilityOne consists of 15 members appointed by the President, 11 from various federal agencies and departments and 4 from the private sector, selected for their involvement and expertise in the employment of people with disabilities. AbilityOne publishes in the Federal Register a procurement list of the goods and services it deems appropriate for the federal government to
purchase through the JWOD program. AbilityOne also determines the fair market price for such goods and services.
12. Once a product or a service is added to AbilityOne's procurement list, federal agencies are required to procure that product or service "from a qualified nonprofit agency for the blind or a qualified nonprofit agency for other severely disabled in accordance with regulations of the Committee and at the price the Committee establishes." 41 U.S.C. § 8504(a). See also 41 C.F.R. 51-5.2. In other words, contracts for those products and services are removed from the general, competitive bidding process and awarded only to qualified CRPs at fixed prices. AbilityOne also encourages federal agencies to issue the longest-term contracts possible when ordering under the JWOD Act, further ensuring steady employment for its constituency and retaining business for its network of CRPs. 41 C.F.R. 51-6.3.
13. As directed by statute, AbilityOne works with two central non-profit agencies to implement and administer the JWOD Act: National Industries for the Blind ("NIB") and NISH (formerly known as National Industries for the Severely Handicapped). NIB and NISH lead wide networks of hundreds of smaller CRPs that serve the blind and disabled communities.
They act as go-betweens between their networks, AbilityOne, and federal contracting entities. They disseminate information to their members about AbilityOne contracts; assist members in bidding for contracts; report on and recommend certain CRPs to AbilityOne and the federal agency administering a contract; and directly allocate federal procurement orders to their members. NIB and NISH also play a role in overseeing whether participating CRPs are complying with the program's regulations. 41 C.F.R. 51-3.2.
14. In order to participate in the JWOD program, a CRP must "employ| ] blind or other severely disabled individuals for at least 75 percent of the hours of direct labor required for
the production or provision of the products or services." 41 U.S.C. § 8501 (6). "Direct labor" "includes all work required for preparation, processing, and packing of a product, or work directly relating to the performance of a service," but not "supervision, administration, inspection, or shipping." Id., at (3).
15. As part of the qualification process, a CRP that employs severely handicapped persons submits an Initial Certification form to NISH. 41 C.F.R. 51-4.2(c). The Initial Certification form for NISH members is Committee Form 402 (Exhibit A). On this form, a CRP reports the number and percentage of direct-labor hours paid to people with and without severe disabilities, and signs a statement certifying the truthfulness of that data. The CRP also certifies that it maintains "a file containing adequate evidence of the disability on each direct-labor employee who is blind or has other severe disabilities.. .verifying that the individual meets the Committee's criteria per 41 CFR 51-4.3."
16. In order to remain qualified to participate in the JWOD program, a CRP that employs severely handicapped persons must submit an Annual Certification form (Committee Form 404) to NISH (Exhibit B). On Committee Form 404, the CRP re-certifies the information reported in the Initial Certification form. 41 C.F.R. 51-4.3(a). The Annual Certification form also requires a CRP to report the direct-labor hours paid to severely disabled and non-severely- disabled employees under JWOD program contracts, as well as the actual number of severely disabled, direct-labor employees working for the CRP.
17. As the certification forms indicate, CRPs must maintain documentation on their workforce that demonstrates the company's eligibility to contract with the federal government through the JWOD program. In each employee's file, the CRP includes a government certification of the employee's disability or a signed report to that effect from a licensed health
care professional. Additionally, the CRP maintains reports on each employee certifying that that individual is unable to "engag[e] in normal competitive employment. These reports shall be signed by a person or persons qualified by training and experience to evaluate the work potential, interests, aptitudes, and abilities of persons with disabilities." 41 C.F.R. 51-4.3(c).
18. CRPs must reevaluate their employees' employment potential and update their records annually. Violating the regulations implementing the JWOD program, including those concerning a CRP's eligibility, can result in expulsion from the program. 41 C.F.R. 51-4.5(b).
THE FRAUDULENT SCHEME
19. In Spring 2010, Relator was informed by one of her consulting clients, a CRP called the National Telecommuting Institute ("NTI"), that NTI intended to aggressively pursue a call-center contract with the Defense Logistics Agency ("DLA"). Relator learned from NTI that one of the competitors for the project was Peckham, a CRP that employed severely disabled persons. Relator had become familiar with Peckham during her time on the Presidential Task Force, and she knew that, many years earlier, Peckham had been investigated for possibly violating rules of the JWOD program.
20. Relator learned that Peckham was seeking to procure several AbilityOne contracts that required significantly higher-level skills than what was ordinarily required to perform contracts set aside under the JWOD program. One of these contracts was a very large contract to manufacture apparel for the military. Historically, NISH members have been able to perform federal contracts involving work such as janitorial, mailroom, landscaping, and laundry services, or very simple assembly-line work, such as placing items in military bags. Recently, however, NISH has been pushing for more complex—and therefore more remunerative—contracts to be set aside for its members.
21. Some individuals with significant disabilities are certainly capable of performing higher-skilled labor. However, Relator believed it would not be possible for Peckham to find and hire enough such individuals in the Lansing area to fill the requirements of the military apparel contract. This is especially true given that such employees must be able to commute to Peckham's factories in a climate that can pose difficulties for persons who are severely disabled.
22. Relator learned that during a meeting involving NISH regional directors and officials from Peckham and other CRPs, David Dubinsky, Executive Director of the Pacific West Regional Office of NISH, had warned against NISH pursuing increasingly complex contracts. Dubinsky cautioned that his region had had to forfeit a contract because the CRP could not find and hire enough individuals to do the work who qualified as severely disabled and were unable to engage in normal, competitive employment.
23. Relator had severe doubts about whether Peckham had really been able to fulfill the requirements of an earlier AbilityOne contract for the State Department (involving passports) by hiring the required number of individuals who had significant disabilities and were unable to engage in normal, competitive employment. Relator did not believe that Peckham was capable of finding the additional eligible workers to fulfill the sought-after DLA contract.
24. Between April and June 2010, Relator communicated with Tony Young, NISH's Senior Public Policy Strategist, and Andrew Houghton, chairperson of AbilityOne, and made numerous requests that AbilityOne audit Peckham. AbilityOne declined to conduct a full audit. However, in July 2010, Houghton arranged for Peckham to host a meeting for himself and Relator at Peckham's headquarters in Lansing, Michigan.
25. On July 12, 2010, Relator and Houghton were met in Lansing by Mitchell Tomlinson, CEO of Peckham. Tomlinson took them to the facility where Peckham was performing the contract work for the State Department. Peckham managed the visit carefully, introducing Relator and Houghton only to three previously selected employees. Nevertheless, Relator, who uses a wheel chair, got Peckham's administrators to allow her to tour the State Department area. There, she saw few signs of accommodations for people with disabilities, and she succeeded in speaking with one Peckham employee who had not been pre-approved. This woman had no apparent physical disability other than excess weight and some difficulty walking, and she mentioned to Relator her previous record of employment.
26. After her tour, Relator raised her concerns about the make-up of the workforce with a vice president of Peckham. Instead of addressing Relator's concerns, the vice president responded: "What would you do if a mother of two young children came to you for a job? And the only way for them to get a job was for you to give them one?"
27. After lunch, Tomlinson took Relator and Houghton to a second, much larger facility where Peckham fills logistics contracts. During their tour of the facility, Relator viewed an enormous, open space where Peckham employees sewed what appeared to be military garments at a frantic pace. Relator saw no persons with visible disabilities, and she saw no accommodations for such persons. Most of the employees worked while standing up.
28. At this facility, Relator was introduced to another Peckham employee named Benny, who read prepared remarks that he had composed for a previous event on Capitol Hill. Several high-ranking Peckham officials sat in on this "conversation," inhibiting frank dialogue. Nonetheless, Benny spoke candidly with Relator after his speech, revealing that until he came to Peckham, he had not known that he was disabled. Moreover, Benny said that after his hiring, he had attempted to recruit some of his drunken neighbors, assuring them that all they needed to do to find a job was apply to Peckham and get declared "disabled." As Benny talked, Peckham's staff looked increasingly nervous and uncomfortable.
29. Additionally, Relator was flabbergasted to learn during Benny's presentation that he was required to sew more than 100 zippers into a garment per hour. Individuals with significant physical disabilities would certainly have great difficulty meeting this quota. Benny himself had been diagnosed as mentally disabled, with bipolar disorder. Relator has worked with individuals with significant mental disabilities, and she has observed that their medications often impose a slowing-down effect. Moreover, these individuals often have a limited ability to concentrate for any length of time, let alone sew more than 100 zippers an hour.
30. After the meeting with Benny, Peckham allowed Relator to view the office suite that houses its large staff of rehabilitation specialists. As noted above, CRPs are required to maintain files on each employee containing certifications from licensed health care professionals as to the quality and severity of the employee's disability. In Relator's experience, many such employees working on AbilityOne contracts receive confirmation of their disabled status from the federal or state government in connection, for example, with the Social Security Disability Insurance program or a state Vocational Rehabilitation program. In contrast, most of Peckham's
employees, like Benny, are certified disabled by the in-house staff, removing a layer of government oversight from the proceedings.
31. Throughout her visit, Relator witnessed many Peckham employees driving to and from the facilities in their own vehicles—an impossibility for many severely disabled individuals and, in Relator's experience, highly unusual for a workplace where such individuals are employed. Much more commonly, CRPs offer bus services to their workforce. In response to Relator's queries, Peckham officials stated that the employees did not experience difficulties with Michigan's harsh winters.
32. During the entire day, Relator did not see more than a half-dozen individuals with visible disabilities, and some of those whom she did encounter did not appear "significantly disabled" within the meaning of the JWOD statute. At the end of the day, in a conversation with Houghton at the airport, Relator was adamant that Peckham's workforce could not possibly comply with the requirements of the JWOD program. Houghton agreed, but to Relator's dissatisfaction, stated, "Legislation will fix it."
33. Peckham and Tomlinson have been defrauding the federal government, and enriching themselves, through Peckham's illegal participation in the JWOD program which is supposed to benefit some of the country's most vulnerable individuals. Peckham has avoided market competition for federal contracts, and it has raised its profit margins by employing workers who may be significantly more capable and efficient than those envisioned by the contracting agencies to be performing their contracts. Peckham's able-bodied workforce also enables it to bid on contracts that are more lucrative than the contracts that are usually set aside under the JWOD Act.
COUNT I; KNOWINGLY PRESENTING FALSE CLAIMS
(31 U.S.C. § 3729(a)(1) (2008), § 3729(a)(1)(A) (2009))
34. Plaintiff re-alleges and incorporates the allegations contained in paragraphs 1 through 33, as if fully set forth herein. This Count is a civil action against Defendants Peckham, Inc., and Mitchell Tomlinson for violating 31 U.S.C. § 3729(a)(1) (2008) or, alternatively, 31 U.S.C. § 3729(a)(1)(A) (2009).
35. Defendant Peckham has knowingly presented, and Defendant Tomlinson has knowingly caused to be presented, false claims for payment to officials or employees of the United States Government. These claims are false insofar as they request payment from federal agencies under the terms of the JWOD program, when Defendants know that Peckham is ineligible to participate in that program.
36. Because of the Defendants' conduct under this Count, the United States has suffered substantial actual damages.
COUNT II: FALSE RECORDS OR STATEMENTS
(31 U.S.C. § 3729(a)(2) (2008), § 3729(a)(1)(B) (2009))
37. Plaintiff re-alleges and incorporates the allegations contained in paragraphs 1 through 33 as if fully set forth herein. This Count is a civil action against Defendants Peckham and Tomlinson for violating 31 U.S.C. § 3729(a)(2)(2008) or, alternatively, 31 U.S.C. § 3729(a)(l)(B)(2009).
38. Defendant Peckham has knowingly made or used, and Defendant Tomlinson has knowingly caused to be made or used, false statements for the purpose of getting false or fraudulent claims paid or approved by the Government. These false statements include, but are
not limited to: false Initial Certification forms for NISH (Committee Form 402), false Annual Certification forms for NISH (Committee Form 404), false reports concerning the disability status of Peckham employees, and false reports certifying that Peckham's employees are unable to engage in normal competitive employment. Defendants have made or used these false statements, or caused them to be made or used, with the specific intent to get paid by the United States Government.
39. Because of Defendant's conduct under this Count, the United States has suffered substantial actual damages.
PRAYER FOR RELIEF
Plaintiff demands judgment against the Defendant as follows:
a. That by reason of the violations of the False Claims Act alleged in Counts I and II, this Court enter judgment in favor of the United States and against the Defendant in an amount equal to three times the amount of damages the United States Government has sustained because of Defendant's actions, plus a civil penalty of not less than Five Thousand Five Hundred Dollars ($5,500.00) and not more than Eleven Thousand Dollars ($11,000.00) for each violation of31 U.S.C. § 3729;
b. That the Relator, as a qui tam Plaintiff in Counts I and II, be awarded the maximum amount allowed pursuant to Section 3730(d) of the False Claims Act or any other applicable provision of law;
c. That Plaintiff be awarded all costs of this action, including reasonable attorneys' fees and court costs; and
d. That Plaintiff has such other relief as the Court deems just and proper.
JURY TRIAL DEMANDED
Plaintiff demands that this matter be tried before a jury.
Respectfully submitted,
C
NACHT, ROUMEL, SALVATORE, BLANCHARD & WALKER, P.C.
^TTavid M. <BIanchard (P67190) 101 N. Main Street, Ste. 555 Ann Arbor, MI 48104-1477 (734) 663-7550 dblanchard at nachtlaw. com
VOGEL, SLADE & GOLDSTEIN, LLP
Robert L. Vogel
1718 Connecticut Avenue, NW, 7th Fl. Washington, DC 20009 (202) 537-5904 rvogel at vsg-law.com
Attorneys for Rebecca Ogle
Dated: March 31, 2011
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