United States Court of Appeals

Case: 09-2280 Document: 39 Date Filed: 07/01/2010 Page: 1 

RECORD NO. 09-2280 

In The 

United States Court of Appeals 

For The Fourth Circuit 

THOMAS M. UBL, United States Ex Rel, 

v. 

Plaintiff – Appellant, 

IIF DATA SOLUTIONS; CHARLES PATTEN, SR., 

and 

Defendants – Appellees, 

UNITED STATES GENERAL SERVICES ADMINISTRATION, 

Party-in-Interest. 

ON APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE EASTERN DISTRICT OF VIRGINIA 

AT ALEXANDRIA 

BRIEF OF APPELLANT 

Victor A. Kubli Michael S. Lieberman 

KUBLI & ASSOCIATES, P.C. Stephen Stine 

8605 Westwood Center Drive DIMUROGINSBERG, P.C. 

Vienna, Virginia 22182 908 King Street, Suite 200 

(703) 749-0000 Alexandria, Virginia 22314 

(703) 684-4333 

Counsel for Appellant Counsel for Appellant 

THE LEX GROUP ♦ 1108 East Main Street ♦ Suite 1400 ♦ Richmond, VA 23219 

(804) 644-4419 ♦ (800) 856-4419 ♦ Fax: (804) 644-3660 ♦ www.thelexgroup.com

Case: 09-2280 Document: 39 9 Date Filed: 07/01/2010 12/03/2009 Page: 21 

UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT 

DISCLOSURE OF CORPORATE AFFILIATIONS AND OTHER INTERESTS 

Only one form needs to be completed for a party even if the party is represented by more than 

one attorney. Disclosures must be filed on behalf of all parties to a civil, agency, bankruptcy or 

mandamus case. Corporate defendants in a criminal or post-conviction case and corporate amici 

curiae are required to file disclosure statements. Counsel has a continuing duty to update this 

information. 

No. _______ Caption: __________________________________________________ 

Pursuant to FRAP 26.1 and Local Rule 26.1, 

______________________ who is _______________________, makes the following disclosure: 

(name of party/amicus) (appellant/appellee/amicus) 

1. Is party/amicus a publicly held corporation or other publicly held entity? YES NO 

2. Does party/amicus have any parent corporations? YES NO 

If yes, identify all parent corporations, including grandparent and great-grandparent 

corporations: 

3. Is 10% or more of the stock of a party/amicus owned by a publicly held corporation or 

other publicly held entity? YES NO 

If yes, identify all such owners: 

4. Is there any other publicly held corporation or other publicly held entity that has a direct 

financial interest in the outcome of the litigation (Local Rule 26.1(b))? YES NO 

If yes, identify entity and nature of interest: 

5. Is party a trade association? (amici curiae do not complete this question) YES NO 

If yes, identify any publicly held member whose stock or equity value could be affected 

substantially by the outcome of the proceeding or whose claims the trade association is 

pursuing in a representative capacity, or state that there is no such member: 

6. Does this case arise out of a bankruptcy proceeding? YES NO 

If yes, identify any trustee and the members of any creditors’ committee: 

CERTIFICATE OF SERVICE 

************************** 

I certify that on _________________ the foregoing document was served on all parties or their 

counsel of record through the CM/ECF system if they are registered users or, if they are not, by 

serving a true and correct copy at the addresses listed below: 

_______________________________ ________________________ 

(signature) (date)


TABLE OF CONTENTS 

i 

Page 

TABLE OF AUTHORITIES ....................................................................................iv 

JURISDICTIONAL STATEMENT ..........................................................................1 

STATEMENT OF ISSUES .......................................................................................1 

STATEMENT OF THE CASE..................................................................................2 

STATEMENT OF FACTS ........................................................................................7 

I. Overview of GSA Contracting Procedures at Issue in This Case.........7 

II. IIF Obtained its GSA Contracts Through False Representations .........8 

A. IIF and Its Award of GSA Contracts ..........................................8 

B. During Ubl’s Case in Chief The Evidence Showed that 

IIF Knowingly Made Material False Representations to 

Obtain Contract Awards .............................................................9 

C. IIF Defended the Complaint Based Upon a 

Misconstruction of the Government Knowledge Defense 

and by Having Factual Witnesses Testify as Experts...............14 

D. Jury Deliberations and the Verdict ...........................................15 

E. IIF’s Post Trial Motion for Attorney Fees Was Granted 

Against Ubl in the Amount of $501,546...................................15 

SUMMARY OF ARGUMENT ...............................................................................16 

ARGUMENT ...........................................................................................................18 

STANDARDS OF REVIEW.........................................................................18


I. THE TRIAL COURT ERRED IN FAILING TO ENFORCE 

THE MAY 6, 2008 SETTLEMENT AGREEMENT FOR 

$8,900,000 WITH THE IIF DEFENDANTS .....................................19 

II. THE TRIAL COURT ERRED IN PERMITTING IIF TO 

PRESENT EVIDENCE AND ARGUE THAT NGB’S 

ACCEPTANCE OF UNQUALIFIED LABOR NEGATES 

LIABILITY UNDER THE GOVERNMENT KNOWLEDGE 

DEFENSE ...........................................................................................23 

A. The Trial Court Erred in Denying Ubl’s Motion in 

Limine........................................................................................23 

1. The Requirements in IIF’s Contracts with GSA 

Could Not Be Altered by NGB ......................................25 

2. The Government’s Knowledge Defense Is 

Inapplicable In This Case ...............................................31 

B. The Trial Court’s Error Was Immensely Prejudicial to 

Ubl.............................................................................................35 

III. THE TRIAL COURT ABUSED ITS DISCRETION IN 

STRIKING UBL’S GSA EXPERT, NEAL FOX...............................37 

A. The Court Abused its Discretion in Finding Fox Was Not 

Qualified and Would Not Provide Helpful Testimony to 

the Jury......................................................................................37 

1. Standard of Review for Excluding An Expert 

Witness ...........................................................................39 

2. The Court Abused Its Discretion in Excluding Mr. 

Fox ..................................................................................40 

B. The Court Abused Its Discretion in Finding Fox Could 

Not Testify as to IIF’S New Defenses at Trial and Could 

Not Testify as to GSA’s Opinion of IIF’S Actions ..................46 

ii


IV. THE TRIAL COURT ABUSED ITS DISCRETION IN 

PERMITTING IIF’S PRIVATE ACCOUNTANT TO 

TESTIFY AS TO GSA POLICIES AND PROCEDURES 

WHEN HE WAS NEVER IDENTIFIED AS AN EXPERT..............48 

V. THE TRIAL COURT EXCLUDED RELEVANT 

TESTIMONY FROM TWO FACT WITNESSES ON THE 

ERRONEOUS BASIS THAT THE FACT WITNESSES’ 

TESTIMONY INCLUDED ADDITIONAL INFORMATION 

NOT CONTAINED IN THEIR DEPOSITION TESTIMONY .........50 

VI. THE TRIAL COURT ERRED IN PERMITTING IIF TO 

ELICIT TESTIMONY THAT NGB WAS AWARE OF THE 

LAWSUIT AND HAD NOT CANCELLED IIF’S 

CONTRACT AS WELL AS INTRODUCING EVIDENCE 

AND ARGUMENT THAT THE GOVERNMENT HAD NOT 

INTERVENED IN THIS ACTION ....................................................53 

VII. THE TRIAL COURT ERRED IN AWARDING IIF 

$501,546.00 IN ATTORNEY FEES FOR THE TIME PERIOD 

OF MARCH 24, 2009 TO OCTOBER 27, 2009................................55 

A. The Court Erred In Finding Ubl’s Claims to be “Clearly 

Frivolous”..................................................................................55 

B. The Court Erred In Finding that As of March 24, 2009 

Ubl Should Have Known That He Had No Reasonable 

Chance of Success.....................................................................67 

C. Defendant’s Fees For the Five Attorneys Billed Were 

Unreasonable.............................................................................70 

CONCLUSION........................................................................................................72 

CERTIFICATE OF COMPLIANCE 

CERTIFICATE OF FILING AND SERVICE 

iii

CASES 


TABLE OF AUTHORITIES 

iv 

Page(s) 

American Sys. Consulting, Inc., 

B 294644, 2004 CPD 247 (Dec. 13, 2004).................................................26 

Christianburg Garment Co. v. EEOC, 

434 U.S. 412 (1978).......................................................................................57 

Fiberglass Insulators, Inc. v. Dupuy, 

856 F.2d 652 (4 th Cir. 1988) ..........................................................................22 

Friendship Heights Assocs. v. Vlastimil Koubek, A.I.A., 

785 F.2d 1154 (4 th Cir. 1986) ............................................................40, 41, 42 

Garrett v. Desa Industries, Inc., 

705 F.2d 721 (4 th Cir. 1983) .................................................................. passim 

Hensley v. Alcon Laboratories, Inc., 

277 F.3d 535 (4 th Cir. 2002) ..........................................................................22 

Houston v. Norton, 

215 F.3d 1172 (10 th Cir. 2000) ......................................................................57 

Koon v. United States, 

518 U.S. 81 (1996).........................................................................................19 

Kopf v. Skyrm, 

993 F.2d 374 (4 th Cir. 1993) ..........................................................................40 

McDonnell v. Miller Oil Co., 

134 F.3d 638 (4 th Cir. 1988) ..........................................................................19 

Melton v. Pasqua, 

339 F.3d 222 (4 th Cir. 2003) ..........................................................................18


Moore v. Beaufort County, 

936 F.2d 159 (4 th Cir. 1991) ..........................................................................22 

Perot Systems Government Services, Inc., 

B-402138, 2010 CPD 64, 2010 WL 884032 (Jan. 21, 2010) ...............26, 28 

Persinger v. Norfolk & Western Railway Co., 

920 F.2d 1185 (4 th Cir. 1990) ........................................................................45 

Pfingston v. Ronan Eng’g Co., 

284 F.3d 999 (9 th Cir. 2002) .................................................................... 57-58 

Rafizadeh v. Continental Common, Inc., 

553 F.2d 869 (5 th Cir. 2008) ..........................................................................58 

Rowland v. Am. Gen. Fin., Inc., 

340 F.3d 187 (4 th Cir. 2003) ..........................................................................19 

Sanford’s Domestic/International Trade, 

B-230580, B-230580-2 88-2 CPD 214 (Sept. 6, 1998)..............................64 

Science Applications International, 

B-401773, 2009 CPD 229 (Nov. 10, 2009).......................................... 26-27 

Scott v. Sears, Roebuck & Co., 

789 F.2d 1052 (4 th Cir. 1986) .................................................................. 45-46 

Tarheel Specialties, Inc., 

B-298197; B-298197.2, 2006 CPD 140 (July 17, 2006)................26, 29, 30 

United States v. Basham, 

561 F.3d 302 (4 th Cir 2009) .....................................................................19, 72 

United States v. Cheek, 

94 F.3d 136 (4 th Cir. 1996) ............................................................................18 

United States v. Collins, 

415 F.3d 304 (4 th Cir. 2005) ..........................................................................18 

v


United States v. Cripps, 

460 F. Supp. 969 (E.D. Mich. 1978) .............................................................33 

United States v. Cushman & Wakefield, Inc., 

275 F. Supp. 2d 763 (N.D. Tex. 2002) ..........................................................33 

United States v. Nat’l Wholesalers, 

236 F.2d 944 (9th Cir. 1956) .........................................................................33 

United States v. Perkins, 

470 F.3d 150 (4 th Cir. 2006) ..........................................................................40 

United States v. Safavian, 

528 F.3d 957 (D.C. Cir. 2008).......................................................................49 

United States ex rel. Atkins v. McInteer, 

470 F.3d 1350 (11 th Cir. 2006) ......................................................................55 

United States ex rel. Berge v. 

Board of Trustees of the University of Alabama, 

104 F.3d 1453 (4 th Cir. 1997), cert denied, 

522 U.S. 916 (1997).......................................................................................54 

United States ex rel. Butler v. Hughes Helicopters, Inc., 

71 F.3d 321 (9 th Cir. 1995) ............................................................................33 

United States ex rel. El-Amin v. The George Washington Hospital, 

533 F. Supp. 2d 12 (D.D.C. 2008).................................................................55 

United States ex rel. Grynberg v. Praxair, Inc., 

389 F.3d 1038 (10 th Cir. 2004) ..........................................................19, 32, 57 

United States ex rel. Gudur v. Deloitte Consulting LLP, 

512 F. Supp. 2d 920 (S.D. Tex. 2007)...........................................................32 

United States ex rel. Hagood v. Sonoma County Water Agency, 

929 F.2d 1416 (9 th Cir. 1992) ........................................................................32 

United States ex rel. Harrison v. Westinghouse Savannah River Co., 

352 F.3d 908 (4 th Cir. 2003) ..........................................................................31 

vi

United States ex rel. J. Cooper & Assocs. v. Bernard Hodes Group, Inc., 

422 F. Supp. 2d 225 (D.D.C. 2006)...............................................................58 

United States ex rel. Mayman v. Martin Marietta Corp., 

894 F. Supp. 218 (D. Md. 1995)....................................................................33 

United States ex rel. Norman Rille and Neal Roberts v. 

EMC Corporation, 

No. 1:09-cv-00628-GBL-TRJ .......................................................................28 

United States ex rel. Stone v. Rockwell International Corp., 

282 F.3d 787 (10 th Cir. 2002), rev’d in part on other grounds, 

549 U.S. 457 (2007).......................................................................................33 

United States ex rel. Vuyyuru v. Jahdav, 

555 F.3d 337 (4 th Cir. 2009) ..........................................................................58 

Winter v. Cath-DR/Balti Joint Venture, 

497 F.3d 1339 (Fed. Cir. 2007) .....................................................................34 

STATUTES 


10 U.S.C. § 2304......................................................................................................26 

18 U.S.C. § 1001......................................................................................................65 

28 U.S.C. § 1291........................................................................................................1 

28 U.S.C. § 1331........................................................................................................1 

31 U.S.C. §§ 3729 et seq........................................................................................1, 3 

31 U.S.C. § 3729(a)(1)(A)-(B) ................................................................................34 

31 U.S.C. §§ 3729-32 ................................................................................................1 

31 U.S.C. § 3732........................................................................................................1 

41 U.S.C. § 253........................................................................................................26 

vii

RULES 

Fed. R. Civ. P. 9(b) ................................................................................................3, 4 

Fed. R. Civ. P. 26(e).....................................................................................14, 17, 52 

Fed. R. Civ. P. 37(c)(1)............................................................................................48 

Fed. R. Civ. P. 50.......................................................................................................6 

Fed. R. Evid. 702 .........................................................................................39, 40, 41 

REGULATIONS 


48 C.F.R. § 2.101 ...............................................................................................10, 63 

48 C.F.R. § 6.102(d) ................................................................................................26 

48 C.F.R. § 8.402(a).................................................................................................25 

48 C.F.R. § 8.404(a).................................................................................................26 

48 C.F.R. § 15 ......................................................................................................7, 26 

48 C.F.R. § 15.402 .....................................................................................................8 

48 C.F.R. § 15.403-1..................................................................................................8 

48 C.F.R. § 3729(b) .................................................................................................25 

48 C.F.R. § 3729(b)(4).............................................................................................67 

48 C.F.R. § 3730(d)(4).............................................................................6, 56, 57, 58 

viii


OTHER AUTHORITIES 

Advisory Committee Notes to Federal Rules of Civil Procedure 26(e)..................53 

John Cibinic, Jr., Ralph C. Nash, Jr. & James F. Nagle, 

Administration of Government Contracts (4th ed. 2006) ........................................34 

Moore’s Federal Practice § 26.131[1] ....................................................................52 

ix

JURISDICTIONAL STATEMENT 

The federal courts have jurisdiction of this action under 28 U.S.C. § 1331 

and 31 U.S.C. §§ 3729-32 (2000). Venue was proper in the District Court for the 

Eastern District of Virginia (“the court”) under id. § 3732, because at least one 

Defendant/Appellee transacted business in the District, and at least one act 

proscribed by 31 U.S.C. § 3729 occurred in that District. 

This Court possesses jurisdiction under 28 U.S.C. § 1291 (2000). The 

Orders appealed from were entered on October 27, 2009, April 28, 2010 and 

December 4, 2010. Timely notices of appeal were filed by Relator on November 

9, 2009, January 4, 2010 (Amended Notice) and May 5, 2010 (Second Amended 

Notice). 


STATEMENT OF ISSUES 

1. Whether the trial court erred in failing to enforce the IIF Defendants’ 

May 6, 2008 settlement agreement? 

2. Whether the trial court erred in permitting IIF to present evidence and 

argue that the National Guard’s acceptance of unqualified IIF labor under IIF’s 

U.S. General Services Administration contract may negate False Claims Act 

liability under the government knowledge defense? 

3. Whether the trial court abused its discretion in striking Ubl’s U.S. 

General Services Administration expert witness?


4. Whether the trial court abused its discretion in permitting IIF’s 

accountant to testify as to U.S. General Services Administration policies and labor 

categories when he was never identified as an expert witness? 

5. Whether the trial court abused its discretion in excluding relevant 

testimony from two fact witnesses on the grounds that the anticipated testimony 

included information not included in their deposition testimony? 

6. Whether the trial court abused its discretion in permitting IIF to elicit 

testimony that NGB was aware of this lawsuit and had not cancelled IIF’s contracts 

as well as introducing evidence and argument that the Government had not taken 

legal action against IIF? 

7. Whether the trial court abused its discretion in awarding defendants 

$501,546 in attorneys’ fees for the time period of March 24 to October 27, 2009? 

STATEMENT OF THE CASE 

As Judge O’Grady noted in his April 28, 2010 Memorandum Opinion, 

“[t]his case proceeded down a long and tumultuous procedural path,” 1 culminating 

in a seven day jury trial… “where after deliberation, the jury returned a verdict in 

Defendants’ favor on all counts.” (J.A. 1983). Unfortunately, the court’s errors in 

refusing to enforce an $8.9 million settlement between the parties, followed by the 

court’s multiple erroneous trial rulings have prejudiced Appellant Thomas Ubl 

1 “J.A. #” designates the joint appendix page. 

2

(“Ubl”) and destroyed the core legal mandate supporting the rationale and indeed 

entire raison d’etre of the U.S. General Services Administration’s (“GSA’s”) 

Government-wide contracting program. These serious errors by the court require 

correction. This Court should vacate the court’s judgment in favor of the 

Appellees. 


On June 2, 2006, Ubl, initiated this qui tam action under the False Claims 

Act (“FCA”), 31 U.S.C. §§ 3729 et seq., by filing a Complaint, under seal, alleging 

that his former employer, IIF Data Solutions, Inc. (“IIF”), and its vice-president, 

Charles Patten, Sr. (“Patten”), (collectively “IIF”) fraudulently induced an award 

of GSA Multiple Award Schedule (“MAS”) contracts, 2 and thereafter submitted 

false claims under those MAS contracts. (Dkt. 1). Ubl worked for IIF in 2001-02, 

starting soon after IIF received a lucrative GSA Schedule Information Technology 

(“IT”) contract and continuing during the time IIF obtained two additional GSA 

contracts (MOBIS 3 and Environmental) utilizing the sales and pricing data 

supplied to GSA to obtain the IT contract. 

The Complaint was unsealed and served on IIF, which moved to dismiss 

under Fed. R. Civ. P. 9(b). (Dkt. 16). On March 30, 2007, the motion was granted 

2 MAS contracts also are referred to as Federal Supply Schedule (“FSS”) contracts, 

an older description. Cases cited herein occasionally refer to FSS contracts. 

3 

MOBIS stands for Management Organizational & Business Improvement 

Services. (J.A. 1371). 

3

with leave to amend (Dkt. 30), and Ubl filed an Amended Complaint on April 13, 

2007. (J.A. 41-59). IIF’s motion to dismiss under Rule 9(b) was denied by Judge 

T.S. Ellis, III, and after discovery, several IIF motions for summary judgment, to 

dismiss and to exclude evidence were denied by Judge Liam O’Grady. (Dkt. 45, 

187, 234) (J.A. 137). Just prior to the scheduled trial date of May 6, 2008, the 

court decided several pre-trial motions. Among those germane to this appeal are 

IIF’s Daubert Motion to Exclude Neal Fox and G. Thorn McDaniel, III 

(respectively, Ubl’s GSA and damages experts), denied on April 29, 2008 (J.A. 

138, 315, 348), and Ubl’s Motion to Exclude Evidence Regarding the United 

States’ Decision Not to Intervene (J.A. 314a), granted on April 30, 2008. (J.A. 

348). 


On May 6, 2008, when the jury trial was to commence, IIF and Ubl reached 

a settlement during mediation before Magistrate Judge Jones, which was 

memorialized in a written settlement agreement. Under the settlement, IIF agreed 

to pay the United States $8,900,000, including Ubl’s attorney fees and costs (inter 

alia). (J.A.435-437). Settlement agreement paragraph 21 states that the agreement 

is void without Government approval, but that “if the Government does not 

approve this agreement, the parties shall cooperate in good faith to effectuate 

changes to this Agreement that will be satisfactory to the Government.” (J.A. 

436). The Department of Justice (“DOJ”), whose representative was present in 

4


chambers during the final construction of the agreement, later objected to several 

aspects of the settlement agreement relating to allocation between the United States 

and Ubl of the $8.9 million in proceeds. 

On March 19, 2009, IIF added Robert Cynkar as counsel. (Dkt. 280). 

On April 17, 2009, IIF filed a motion to dismiss for lack of subject matter 

jurisdiction, which was denied on May 5, 2009. (Dkt. 287). On May 15, 2009, the 

Court re-scheduled the jury trial for October 19, 2009 (Dkt. 290), although the 

Government and Ubl remained in discussions relating to the settlement agreement 

with the aid of Magistrate Judge Jones. See, e.g., Docket Sheet, June 25, 2009. 

Through September of 2009, discussions between Ubl and the Government 

continued toward resolving DOJ’s objections to the settlement agreement issues. 

On September 17, 2009, the DOJ and Ubl reached an agreement in principle. (J.A. 

432). Based on the Government’s approval in principle, Ubl filed a motion to 

enforce the settlement agreement. (J.A.419-437). Despite the resolution-in- 

principle of the settlement agreement issues, on October 9, 2009 (ten days before 

the trial was scheduled to commence), the court heard argument (J.A. 438-453) and 

denied Ubl’s motion to enforce the settlement agreement or take the case off the 

docket for further proceedings (Dkt. 309), thereby disregarding and frustrating the 

cooperative terms and conditions of the settlement. 

5

The case proceeded to trial on October 19, 2009. During the seven-day jury 

trial, the court limited the testimony of several important Ubl witnesses, and 

excluded Ubl’s GSA expert, Neal Fox. (J.A. 977-1033). After Ubl presented his 

case-in-chief, the court declined to grant IIF’s motion under Fed. R. Civ. P. 50. On 

October 27, 2009, the jury returned a verdict for IIF on the Amended Complaint 

and for Ubl on IIF’s counterclaim alleging theft of trade secrets. (J.A.1649). 

Judgment was entered that day. (J.A. 1661). 

On November 12, 2009, IIF filed a motion for attorneys’ fees arguing that 

Ubl’s case was “clearly frivolous” within the meaning of FCA § 3730(d)(4) (Dkt. 

341), which was granted as to Ubl on December 4, 2009. (J.A. 1951). On April 

28, 2009 the Court assessed $501,546.00 in attorneys’ fees against Ubl. (J.A. 

2008). 


On November 9, 2009, Ubl timely filed a Notice of Appeal of the October 

27, 2009 Judgment Order. (J.A. 1674). On January 4 and 6, 2010, an Amended 

Notice of Appeal was timely filed to the Court’s December 4, 2009 Order granting 

attorney fees against Ubl. (J.A. 1954). On May 5, 2010, a subsequent Amended 

Notice of Appeal was timely filed by Ubl to include an appeal of the April 28, 

2010 award of $501,546 in attorney fees against him. (Dkt. 379). 

6

STATEMENT OF FACTS 

I. Overview of GSA Contracting Procedures at Issue in This Case 

The GSA’s MAS program provides a simplified mechanism by which U.S. 

agencies may acquire commercial services and supplies without the burden of full 

and open competition for each individual agency order. The GSA awards MAS 

contracts for each commercial service or supply. The items and the prices for the 

items are established through initial negotiations between the GSA’s warranted 

Contracting Officer and the potential MAS contractor; and the negotiated items 

and prices are set forth in the resulting GSA MAS contract award. 

The MAS contractor then publishes its MAS catalog to the federal agencies, 

and those agencies use the MAS catalog to order the approved items, services or 

supplies. Significantly, since the prices already have been vetted in connection 

with the original MAS contract award, the federal agencies may place orders 

without a cost and pricing audit, or the full and open competition otherwise 

required by the Truth in Negotiations Act, the Competition in Contracting Act and 

Title 48 of the Code of Federal Regulations, Federal Acquisition Regulation 

(“FAR”) Part 15. 


In the initial negotiations, the would-be MAS contractor must provide the 

GSA with either: (1) correct, accurate and complete “cost or pricing data” and 

submit to an audit, or (2) if the offeror has the requisite commercial sales, its 

7

complete commercial sales history for the services or items supplied, including 

pricing and discount information, and a commercial price list. In the latter case, 

the GSA Contracting Officer uses that information, in lieu of more detailed and 

cumbersome “cost or pricing data,” to evaluate the reasonableness of offered price, 

to negotiate a Government discount and to then make an award decision. E.g. FAR 

15.402; 15.403-1. 

Offerors providing false commercial sales, pricing and discount information 

in a proposal to obtain a MAS contract deny the GSA Contracting Officer what she 

needs to protect the Government’s interests, i.e., to award MAS contracts to 

experienced and responsible contractors at prices tested in the commercial 

marketplace which therefore are fair and reasonable; and thereby to meet the GSA 

Contracting Officer’s “fiduciary responsibility to the American taxpayer and to 

customer agencies to take full advantage of the government’s leverage in the 

market in order to obtain the best deal for the taxpayer” and to obtain the Most 

Favored Customer status for the government by obtaining the offeror’s best price. 

(J.A. 1368). 


II. IIF Obtained its GSA Contracts Through False Representations 

A. IIF and Its Award of GSA Contracts 

IIF was established in 1998 by Patten and his wife. At the time, Patten was 

in the National Guard. While he was still employed by the Guard, Patten began 

8


negotiating to obtain National Guard contracting work for IIF from The McVey 

Corp., Inc. (“TMCI”). Patten retired from the National Guard in August, 1998, and 

subsequently, IIF and TMCI entered into a contract to perform subcontracting 

work for Amerind, Inc., a prime contractor performing services for the National 

Guard Bureau (“NGB”). IIF’s work for TMCI concluded in May, 1999, and 

shortly thereafter, IIF began performing work directly as a subcontractor for 

Amerind providing services to NGB. 

In August 2000, IIF submitted a proposal to GSA for a MAS contract for IT 

services which involved labor categories ranging from program manager to quality 

assurance analyst. In November 2000, GSA awarded IIF a MAS contract for six 

labor categories as specific prices. In 2001, IIF sought several additions to the 

labor categories, and in July 2001, GSA added these to labor categories to IIF’s 

MAS IT contract. In 2002, IIF obtained two additional GSA MAS contracts: 

MOBIS and Environmental. Virtually all of the orders under these three GSA 

contracts were placed by NGB, where (as noted) Patten had worked. 

B. During Ubl’s Case in Chief The Evidence Showed that IIF 

Knowingly Made Material False Representations to Obtain 

Contract Awards 

In their proposals to the GSA for the MAS contracts, IIF provided false prior 

sales and discounting information to induce GSA to award the contract at specific 

prices. For example, IIF reported to GSA commercial prices based on negotiated 

9

discounts for a 60-hour work week with TMCI, and asked GSA not to take those 

lower labor rates into account in determining the MAS contract price (J.A. 1302). 

In reality, there were no such discounts, much less negotiated discounts. 

IIF also submitted to GSA a “January 2000 commercial price list” of the 

labor categories IIF supposedly had sold in the open market at the established 

catalog or market prices therein (J.A. 1329). In fact, IIF had never previously used 

the commercial price list that was presented to the GSA (J.A. 582-589). Indeed, 

IIF could not recall selling any of the items on the commercial price list at the 

prices listed therein (J.A. 583, 587); the price list itself was backdated (J.A. 586- 

587); and the price list lacked the statement expressly required by the GSA’s MAS 

contract solicitation that warned GSA that the proffered price list was not actually 

used in the marketplace (J.A. 589, 1294 at (c)(1)). Further, IIF reported to GSA 

standard discounts off of IIF’s so-called commercial sales prices (J.A. 1303), when 

in fact there never were previous sales of the labor categories at the listed prices 

and, necessarily, no standard discounts of such non-existent sales prices. (J.A. 

1305). 


Finally, IIF reported to GSA a specific “hourly rate on PO [Purchase Order]” 

purportedly issued by Amerind (J.A. 1305) in order to establish that the prices 

proposed for each of the offered labor categories were “market tested” and 

therefore fair and reasonable. (J.A. 61) (citing FAR 2.101). In fact, there were no 

10

“hourly rates on PO” for the listed labor categories (or indeed any labor 

categories). (J.A.1151-53; 1228-1231; 1305). Instead, the sales to Amerind were 

fixed-price, billed monthly. They were not sales of labor categories at hourly rates 

(much less from a catalog or price list for such labor categories at the hourly rates 

listed therein) as IIF told the GSA. (J.A. 1115-53; 1228-1231). The prices IIF 

proposed for the offered labor categories were not market-tested. IIF simply made 

them up. 


IIF’s false representations to GSA formed the basis for its award of the MAS 

IT contract and the labor category prices therein. IIF’s fabricated and backdated 

commercial price list – and the fictive pricing data therein -- was one of the 

explicitly-stated “Bas[e]s for Negotiation and Award.” (J.A. 1332-1333) 

[“Commercial Price List effective January 2000”) (“This contract includes the 

following . . . Commercial Price List dated January-1-2000”). The listed Amerind 

purchase orders and supposed labor category “hour rates” therein were an explicit 

“basis” for the GSA’s ultimate “negotiation and award” of the IT MAS contract to 

IIF. (J.A. 1333). IIF’s subsequent two contracts (the “Environmental” and 

“MOBIS” contracts) were obtained on the basis of the IT contract award, as the 

awards themselves expressly state. (J.A. 1366-69; 1370-1373) (Sections 3, 

“Justification,” therein). 

11


IIF also induced the award of the IT contract by falsely claiming in its 

August 23, 2000 offer (J.A. 1288) that it had previously “sold” Analyst II labor to 

Amerind for $37.80 per labor hour (J.A. 1305), which required a minimum of four 

years IT experience and a four year bachelor degree. In fact, unbeknownst to 

GSA, these “Analyst II” services were performed by Charles Patten, Jr., a recent 

high school graduate with virtually no IT experience. (J.A. 878). Likewise, IIF 

billed Vince Apesa as an Analyst II, even though his resume and testimony 

indicated that he had less than four years of IT experience. (J.A. 920). 

Once GSA awarded the IT MAS contract to IIF (and later the Environmental 

and MOBIS contracts), the company continued its pattern of lying about its 

unqualified labor, of exploiting its GSA contracts by billing GSA for labor 

categories at inflated prices and by misclassifying many of the labor personnel it 

provided into higher-priced categories for which the individuals who performed 

the work did not remotely qualify. See June 2001 through June 2002 IIF invoices 

billing IT contract services to GSA. (J.A. 1374-75, 1381-82, 1386-87, 1391-92, 

1445-46, 1450-51, 1459-60, 1477-78, 1151-1512). Specifically, IIF consistently 

billed for work by individuals who lacked the education or experience to qualify 

for the labor categories at which they were (over) billed and even billed Kim 

Trimble for IT services for three-quarters of her time when she was not performing 

12

any IT related services for NGB. 4 As one of many examples, IIF continued to 

report Mr. Patten’s son, a recent high school graduate, with no more than five 

months of IT experience and no bachelor’s degree as an Analyst II. (J.A. 593-597; 

1317). 

At trial, Ubl introduced the testimony of several GSA Contracting Officers 

(“COs”), including the CO who awarded the IT contract, that false commercial 

pricing information contained in an offer was capable of affecting their award 

decision, and that if such information were discovered, a recommendation of no 

award would likely be issued. (J.A. 506-509). In other words, the fabricated and 

backdated commercial price list and other false sales and pricing information were 

material. 


Under its IT, Environmental and MOBIS contracts, IIF submitted to GSA a 

total of at least 2,100 invoices claiming over $74 million. The United States paid 

these invoices in full. (E.g., J.A. 1374-75, 1380-81, 1386-87, 1391-92, 1397-98, 

1445-46, 1450-51, 1459-60, 1477-78, 1511-1512). Ubl’s damages expert, Thorne 

McDaniel, who did not testify due to the court’s exclusion of a predicate expert 

witness, Fox (see Argument III, infra at n. 11), estimated in his report that IIF’s 

4 See testimony of Charles Patten, Sr. (J.A. 593-598); Charles Patten Jr, (J.A. 878- 

881);Vince Apesa (J.A. 920); Kim Trimble, (J.A. 749, 783-800) and other 

documentary evidence (e.g. Apesa resume, J.A.1282-87). 

13


actual overcharges to the government for unqualified labor or improperly awarded 

task orders totaled over $18 million. (J.A. 225). 

Besides excluding Ubl’s experts, the court also prevented several fact 

witnesses from giving critical testimony as to IIF’s fraudulent activities, on the 

grounds that Ubl violated Fed. R. Civ. P. 26(e) by not informing IIF that the 

witnesses’ anticipated testimony would include material not disclosed during their 

depositions, which Ubl had just learned. See Argument V, infra. 

C. IIF Defended the Complaint Based Upon a Misconstruction of the 

Government Knowledge Defense and by Having Factual 

Witnesses Testify as Experts 

IIF defended Ubl’s Complaint in significant part by arguing that regardless 

of any false statements to the GSA in obtaining the MAS contracts or in providing 

unqualified personnel to fulfill the contracts, the ordering agency, NGB, was 

permitted to ignore the requirements of the GSA MAS contract and hire personnel 

at labor categories and rates for which the person lacked either the education or 

experience stated in the GSA MAS contracts (as long as the ordering agency was 

happy with the work). Ubl explained to the court that IIF’s argument was clearly 

wrong as a matter of fact and as a matter of law. However, the trial court rejected 

Ubl’s objections. (J.A.1026-1028). See Argument II, infra. 

Furthermore, during IIF’s case, over Ubl’s objection, the court permitted IIF 

to elicit expert testimony from a factual witness, accountant Robert Taylor, to the 

14


effect that a GSA MAS contractor may provide and bill labor even if it does not 

satisfy the definition for the MAS contract labor category and price under which 

such labor is billed. (J.A.1059). Moreover, Taylor also was permitted to testify 

that the “government” for purposes of the administration of GSA MAS contracts is 

the ordering agency (here, NGB) and not the GSA. (J.A. 1080). 

D. Jury Deliberations and the Verdict 

After approximately seven hours, the jury returned a verdict denying Ubl’s 

claims and also denying IIF’s counterclaim. Judgment was entered that day, 

October 27, 2009. (J.A. 1661). 

E. IIF’s Post Trial Motion for Attorney Fees Was Granted Against 

Ubl in the Amount of $501,546 

After trial, IIF’s motion for attorney fees was granted by the court on 

December 4, 2009, and on April 28, 2010, the court issued a Judgment Order and 

Memorandum Opinion awarding attorney fees against Ubl in the amount of 

$501,546, and setting forth what it considered to be “the most prevalent examples 

of the frivolous nature of Ubl’s case.” (J.A. 1987-1999). In part, the court relied 

upon the notion that it was NGB which “had the responsibility for determining 

whether a particular employee met the relevant qualifications” and hence there was 

no basis for alleging that IIF’s billing of personnel who failed to satisfy the 

definitions of the labor categories and prices at which they were billed rose to the 

level of fraud. Similarly, the court found that certain misrepresentations were a 

15

“hyper-technical” construction of whether IIF listed rates were “on” purchase 

orders, that IIF’s backdated and previously unused commercial pricelist was an 

oversight, and that other erroneous pricing information was mere “technical” error. 

(J.A. 1987-1999). 


Accordingly, despite the court’s denial of IIF’s motion for summary 

judgment, despite the fact that IIF entered into a settlement agreement with Ubl for 

$8.900,000 on the day the first trial was scheduled to commence, and despite the 

fact that Ubl repeatedly demonstrated during the trial that IIF had submitted false 

information in order to obtain its MAS contracts, the court concluded that Ubl’s 

claims were “clearly frivolous” and had no reasonable chance of success. (J.A. 

1984-1989). In this appeal, Ubl challenges the court’s conclusions in this regard 

and its award of $501,546 in attorney fees. See Argument VIII, infra. 

SUMMARY OF ARGUMENT 

In this qui tam action, the trial court initially erred in not enforcing an $8.9 

million settlement agreement after the Government and Ubl resolved their 

differences and the Government was prepared to obtain the proper authorized 

signatures. (Issue 1). 

Then, at trial the court made numerous erroneous rulings that were highly 

prejudicial to the Relator’s case and led to a defense verdict. First, the court 

allowed IIF to misapply the government knowledge defense by arguing that the 

16

National Guard’s purported knowledge of IIF’s fraudulent conduct absolved IIF 

from liability even though the contracts at issue were with the GSA and 

administered by the GSA and by law, the National Guard could not change the 

contracts or ratify IIF’s fraud. (Issue 2). In addition, the court excluded Ubl’s 

GSA expert (the former GSA Assistant Commissioner of Acquisitions, the third 

ranking position at GSA and who oversaw GSA’s MAS program) from testifying 

based upon the erroneous conclusion that his testimony would not be helpful to the 

jury (issue 3), even though the court then (erroneously) allowed IIF’s private 

accountant, who was not designated as an expert, to provide his opinions on some 

of the same issues regarding IT qualifications, GSA contract requirements and 

GSA policy. (Issue 4). In addition to excluding the Relator’s expert, the court also 

erroneously excluded important testimony from two fact witnesses under a 

misapplication of Rule 26(e) because Relator did not inform the defense that the 

fact witnesses’ anticipated testimony differed from their deposition testimony 

(which Relator had just learned). (Issue 5). The last trial error before the Court is 

that the trial court erroneously permitted the defense to elicit testimony and argue 

that NGB was aware of the lawsuit and had not cancelled IIF’s contracts, as well as 

introducing evidence and argument that the Government had not instituted legal 

proceedings against IIF, both in contravention of law and an earlier court pre-trial 

order. (Issue 6). 


17

After trial, the trial court abused its discretion by awarding defendants’ over 

$500,000 in attorney fees based upon the clearly erroneous conclusion that the 

Relator’s should have known that he could not have prevailed in this case and that 

his claims were clearly frivolous. (Issue 7). 

Due to these errors, Ubl asks that the judgments of the court be vacated and 

the case remanded for enforcement of the settlement agreement or a new trial. 

STANDARDS OF REVIEW 

ARGUMENT 

Issue: 1: Appellate courts review a court’s finding as to the validity of a 

settlement agreement de novo. Melton v. Pasqua, 339 F.3d 222 (4 th Cir. 2003). 

Issue 2: Whether the court erred in permitting IIF to present evidence and 

argue that NGB’s acceptance of unqualified labor may negates False Claims Act 

liability under the “government knowledge” defense is reviewed de novo because 

the issue regarding the propriety of the argument and defense is a legal issue. See 

United States v. Collins, 415 F.3d 304 (4 th Cir. 2005) (as this issue raises a question 

of law, the appropriate standard of review is de novo. United States v. Cheek, 94 

F.3d 136, 140 (4 th Cir. 1996)). 

Issue 3: Appellate courts review a court’s exclusion of an expert witness for 

abuse of discretion. Garrett v. Desa Industries, Inc., 705 F.2d 721, 724 (4 th Cir. 

1983). 


18


Issues 4 - 6: Appellate courts review a district court’s evidentiary rulings for 

abuse of discretion. Rowland v. Am. Gen. Fin., Inc., 340 F.3d 187, 194 (4 th Cir. 

2003). However, a district court by definition abuses its discretion when it makes 

an error of law. McDonnell v. Miller Oil Co., 134 F.3d 638, 640 (4 th Cir. 1988), 

citing Koon v. United States, 518 U.S. 81 (1996). 

Issue 7: Appellate courts review a district court’s decision to award 

attorney fees under an abuse of discretion standard, McDonnell v. Miller Oil Co., 

134 F.3d 638, 640 (4 th Cir. 1988); however, a “clearly frivolous” finding is a 

difficult standard and rarely met. United States ex rel. Grynberg v. Praxair, Inc., 

389 F.3d 1038, 1058 (10 th Cir. 2004). 

All issues: The cumulative error doctrine requires a reversal when two or 

more individually harmless errors prejudice a party to the same extent as a single 

reversible error and deny a party a fair trial. United States v. Basham, 561 F.3d 

302, 330 (4 th Cir 2009). 

I. THE TRIAL COURT ERRED IN FAILING TO ENFORCE THE 

MAY 6, 2008 SETTLEMENT AGREEMENT FOR $8,900,000 WITH 

THE IIF DEFENDANTS 

On May 6, 2008, Ubl and IIF and Charles Patten Sr. executed a written 

Settlement Agreement in the Chambers of Magistrate Judge Jones. (J.A. 435-37). 

Under the Settlement Agreement, IIF and Patten were required to pay $8.9 million 

“inclusive of all damages, costs and fees.” (J.A. 435 1). 

19


The Settlement Agreement also addressed the role of the United States, as 

the real party-in-interest in this FCA action, in the action. Namely, it provided that 

“[i]f the Government has not approved this Agreement by June 7, 2008, all 

payments due under this Agreement shall be held in escrow pending Government 

approval or disapproval.” (J.A. 436 20). In anticipation of the possibility that the 

Government might require modifications to the Settlement Agreement, Ubl and the 

Defendants further agreed that the Settlement Agreement is “void without 

Government approval. If the Government does not approve this Agreement, the 

parties shall cooperate in good faith to effectuate changes to this Agreement that 

will be satisfactory to the Government.” (J.A. 436 21). 

As Ubl and Defendants contemplated in drafting and executing their 

Settlement Agreement, the Government did object to a number of the terms therein 

relating principally to the allocation of proceeds between Ubl and the Government. 

After a lengthy period of negotiations, Ubl and the Government resolved their 

disputes, and Government counsel authorized Ubl’s counsel to represent to the 

court in Relator’s Motion to Enforce Settlement and Enter Judgment Pursuant to 

Such Settlement (J.A. 419-434) that: 

Relator’s counsel and Government trial attorneys have resolved in 

principle between them the issues of the total Settlement Amount 

specified in the May 6, 2008 Agreement (“Settlement Amount”), the 

allocation of the Settlement Amount between the United States, 

Relator, and Relator’s Counsel, and the terms specified in the May 6, 

2008 Agreement with respect to the upfront payment and payout 

20


terms. Government trial attorneys are prepared to recommend to 

officials with authority within the United States Department of Justice 

and the relevant agencies approval under such terms, should the Court 

grant enforcement of the May 6, 2008 Agreement between Relator 

and Defendants. 

(J.A. 432-433). Hence, as of September 25, 2009, Ubl and the Government had 

resolved their disagreements and the Settlement Agreement term that requires 

Government approval was being satisfied. 

Nevertheless, on October 9, 2009, after a hearing, the Court not only denied 

Relator’s Motion to Enforce Settlement because the Government had not yet 

signed the agreement, but also refused to grant the Government a period of time to 

complete its internal administrative process for signature. The Court stated that: 

the continued negotiations have resulted in material changes to the 

initial agreement to agree that was entered into by two of the three 

parties. And the third party is missing from the consent. And as a 

result, there has never been a binding, enforceable contract entered 

into. 

(J.A. 449-450). The supposed “material changes” were not identified -- and indeed 

there were no material changes that could constitute a legal excuse to relieve IIF 

and Patten from their obligations under their executed Settlement Agreement. 

Furthermore, as the Motion to Enforce explicitly stated, the supposedly “missing” 

party (i.e., the Government) had just indicated that it was prepared to approve the 

Settlement Agreement. 

21

The court has the inherent authority, arising from its equitable power, to 

enforce the Settlement Agreement. Hensley v. Alcon Laboratories, Inc., 277 F.3d 

535, 540 (4 th Cir. 2002). “In deciding whether a settlement agreement has been 

reached, the Court looks to the objectively manifested intentions of the parties.” 

Moore v. Beaufort County, 936 F.2d 159, 162 (4 th Cir. 1991). The courts have 

noted that public policy favors settlements, and therefore construe settlements in 

favor of enforceability. Fiberglass Insulators, Inc. v. Dupuy, 856 F.2d 652, 654 

(4 th Cir. 1988). 

Here, Ubl and IIF and Patten had a meeting of the minds on May 6, 2008 

and objectively manifested their intentions of entering into the Settlement 

Agreement which they signed in the Chambers of a Federal Magistrate Judge. The 

parties expressly contemplated the need for Government approval and the 

concomitant possibility that the Government may require modifications. 

Accordingly, they committed themselves to “cooperate in good faith to effectuate 

changes to this Agreement that will be satisfactory to the Government.” (J.A. 

436). Yet precisely when the Government indicated that its objections to the 

proceeds allocation issues had been satisfied and that it was prepared to 

recommend approval of the Settlement Agreement, the court ruled it to be 

unenforceable. 


22


In effect, the court’s decision placed Ubl in a catch-22 situation. On the one 

hand, the Government had resolved in principle all issues with Ubl and simply 

wished the court to put its blessing on the May 6, 2008 settlement agreement by 

finding it to be enforceable before the Government went through the cumbersome 

process of obtaining the proper sign offs from the authorized DOJ officials. On the 

other hand, the court ruled that the settlement agreement was not enforceable until 

the Government had officially signed off on the May 6 settlement agreement. The 

court’s decision was clearly erroneous. At a minimum, the court should have taken 

the case off the active docket, as Ubl suggested in the Motion to Enforce (J.A. 

433), and set a date certain for the final agreement to be implemented. 

II. THE TRIAL COURT ERRED IN PERMITTING IIF TO PRESENT 

EVIDENCE AND ARGUE THAT NGB’S ACCEPTANCE OF 

UNQUALIFIED LABOR NEGATES LIABILITY UNDER THE 

GOVERNMENT KNOWLEDGE DEFENSE 

A. The Trial Court Erred in Denying Ubl’s Motion in Limine 

During the trial in the instant matter, it became clear that IIF intended to 

present evidence and argument that it submitted no false claims to GSA because 

the ordering agency, NGB, approved the IIF personnel and was satisfied with their 

work. Because this contention is not a valid defense to an FCA claim, Ubl filed a 

“Motion in Limine to Preclude Admission of Evidence That the National Guard 

Bureau Was Entitled to Vary the Terms of Defendants’ Federal Supply Schedule 

Contracts.” (J.A. 1529-1536). In response, IIF argued that Ubl was trying to “turn 

23


this fraud case into a breach of contract action.” (J.A. 1026). IIF relied on the 

government knowledge defense, arguing that it was entitled to introduce “evidence 

of the [National] Guard’s knowledge of what IIF was doing” because “it is well 

established that the government’s full knowledge of the material facts underlying 

any representations implicit in a contractor’s conduct negates any knowledge that 

the contractor had regarding the truth or falsity of those representations.” 

(J.A.1026). Ubl in turn pointed out that the government knowledge defense was 

inapplicable because “the knowledge of the National Guard has no bearing on the 

knowledge and the consent of GSA, who was administering the program and who 

made the finding of fair and reasonable pricing.” (J.A. 1027-28). 

Despite the clear legal mandates of GSA MAS contracting, the court 

erroneously denied Ubl’s Motion in Limine and accepted IIF’s government 

knowledge defense because it found “when you are dealing with fraud such as this, 

certainly it is relevant what occurred between the National Guard and IIF Solutions 

in fulfilling the terms of the contract.” (J.A. 1028). Later, in its April 28, 2010 

Memorandum Order, the court explained: “it appeared that it was NGB which had 

the responsibility for determining whether a particular employee met the relevant 

qualifications.” (J.A. 1987). 

24


The court’s misapplication of the government knowledge defense premised 

upon a severe and serious misapprehension of GSA contracting was perhaps its 

most fundamental error in the trial. The court permitted testimony and argument 

that NGB’s alleged acceptance of IIF’s unqualified labor personnel negated IIF’s 

fraudulent intent, i.e., whether IIF submitted false statements to the government 

“knowingly” as the FCA defines that term. See FCA § 3729(b). As set forth 

below, IIF’s three MAS contracts were with GSA, not NGB. (J.A. 1288, 1366, 

1370). That NGB may have been “happy” with the work performed by IIF cannot 

nullify the fact that IIF fraudulently obtained these three GSA contracts and then 

used them to overbill GSA by millions of dollars. 

1. The Requirements in IIF’s Contracts with GSA Could Not 

Be Altered by NGB 

The GSA’s MAS program provides federal agencies with a “simplified 

process for obtaining commercial supplies and services at prices associated with 

volume buying.” FAR 8.402(a). Under the GSA’s MAS program, the GSA fully 

vets and negotiates the proposed MAS contractor’s items and prices prior to the 

MAS contract award. Once the GSA Contracting Officer approves the items and 

negotiates a reasonable price, the items and negotiated prices are fixed in an MAS 

25


contract and may not be varied. 5 See Competition in Contracting Act, 10 U.S.C. § 

2304; 41 U.S.C. § 253; see also 48 C.F.R. § 8.404(a). 

An ordering agency such as NGB has no legal authority to vary the terms of 

GSA’s MAS contracts. If a MAS contractor or ordering agency deviates from the 

GSA vetted and negotiated items and prices in the vendor’s MAS contract, the 

above carefully crafted and heavily regulated framework for ensuring that the 

Government receives a fair and reasonable price is destroyed. “When a concern 

arises that a vendor is offering services outside the scope of its MAS contract, the 

relevant inquiry is not whether the vendor is willing to provide the services that the 

agency is seeking, but whether the services or positions offered are actually 

included on the vendor’s MAS contract, as reasonably interpreted.” Tarheel 

Specialties, Inc., B-298197; B-298197.2, 2006 CPD 140 (July 17, 2006) 

(emphasis added); American Sys. Consulting, Inc., B 294644, 2004 CPD 247 

(Dec. 13, 2004); see also Science Applications International, B-401773, 2009 CPD 

5 Given the GSA’s vetting and negotiation of the terms and prices in the GSA 

MAS contracts they award, agency orders under those MAS contracts are 

considered to satisfy the requirements of full and open competition, FAR 6.102(d) 

(3), and are not subject to FAR Part 15, which prescribes competitive procedures 

for most negotiated contracts. FAR 8.404(a). The MAS contractor’s catalog with 

the approved items and prices may be used by agencies throughout the 

Government and those “[a]gencies are not required to conduct competitive 

acquisitions when making purchases under the FGSS . . . .” REEP, Inc., B- 

290665, 2002 CPD 158. See also, Perot Systems Gov’t Serv’s., B-402138, 2010 

CPD 64. 

26

229 (Nov. 10, 2009) at 1 (under an MAS acquisition, all items ordered must be 

included on the vendor’s schedule contract). 

As the U.S. Government Accountability Office (“GAO”) stated in a recent 

report to Congress: 

Where an agency announces its intention to order from an existing 

GSA contractor, all items ordered are required to be within the scope 

of the vendors’ contracts [citing Tarheel Specialties, Inc., B-298197, 

298197.2, 2006 CPD 140 (July 17, 2006)]. Orders issued outside 

the scope of the underlying GSA contract do not satisfy legal 

requirements under the Competition in Contracting Act for 

competing the award of government contracts and limit the 

government’s ability to know if it is paying a fair and reasonable 

price. 

(J.A. 1623) [GAO Report 08-360, Army Case Study Delineates Concerns with Use 

of Contractors as Contract Specialists (March 2008) at 24] [emphasis added]. “[I]t 

is the responsibility of the ordering activity to follow ordering procedures and stay 

within scope. It is also the responsibility of the contractor to follow Terms & 

Conditions of its contract.” (J.A. 1646). 

Consistent with these long-standing and core requirements of the GSA’s 

MAS contracting program, the MAS contracts at issue in this case explicitly state 

that: 

The Contractor [IIF] shall only tender for acceptance those items that 

conform to the requirements of this contract. 

(J.A. 1287, 1367, 1372) [emphasis added]. IIF’s IT MAS contract further states 

that: 


27


All delivery orders or task orders are subject to the terms and 

conditions of this contract. In the event of conflict between a 

delivery order or task order and this contract, the contract shall 

control. 

(J.A. 1290 [emphasis added]). 6 

In sum, GSA MAS contractors and ordering agencies, such as NGB, 

definitively may not vary the terms of their MAS contract, and IIF was not free to 

charge personnel under labor categories and at prices for which the personnel did 

not qualify. Decisions of the GAO confirm this clear rule. For example in Perot 

Systems Government Services, Inc., B-402138, 2010 CPD 64, 2010 WL 884032 

(Jan. 21, 2010), the ordering agency (the Veterans Administration) solicited offers 

for an order for IT labor to be acquired under an IT MAS contract. When GSA 

MAS contractor Perot proposed IT labor category rates that varied from the rates in 

its GSA MAS IT contract, the GAO ruled that Perot’s bid for the Veteran’s 

Administration order properly was rejected, because: 

Perot quoted prices that were not on its current MAS contract and 

thus were neither published nor determined to be fair and 

reasonable by GSA. This being the case, Perot’s quotation was 

inconsistent with the terms and conditions of the RFQ [Request for 

Quotation] and MAS regulations, and therefore unacceptable. Thus, 

GSA properly eliminated it from consideration. 

Id. at *3 (emphasis added). 

6 The United States reiterated this core element of the GSA’s MAS program in 

United States ex rel. Norman Rille and Neal Roberts v. EMC Corporation, No. 

1:09-cv-00628-GBL-TRJ, U.S. First Am. Compl. in Intervention 17. (J.A. 

1541). 

28

Similarly in Tarheel (see supra), the U.S. Department of Homeland Security 

solicited an order under GSA MAS contracts for labor categories. Consistent with 

the mandates of the GSA’s MAS program, the agency’s solicitation advised MAS 

contractors that: 

id. at *2. 


the [offeror’s proposal] must identify each category of labor proposed 

for performance mapped to the applicable GSA Schedule labor 

category, provide the GSA Schedule price, show the proposed 

discounts for the rate, and the rate proposed for the particular labor 

category inclusive of the discount. 

When Tarheel protested the award on the grounds that awardee’s, USIS, 

GSA MAS contract did not contain all of the labor categories required by the 

agency’s order solicitation, the GAO reiterated that: 

Where an agency announces its intention to order from an existing 

GSA MAS contractor, it means that the agency intends to order all 

items using GSA MAS procedures and that all items are required to 

be within the scope of the vendor’s MAS contract. See Armed 

Forces Merchandise Outlet, Inc., B-294281, Oct. 12, 2004, 2004 CPD 

218 at 4. Non–MAS products and services may not be purchased 

using MAS procedures; instead, their purchase requires compliance 

with the applicable procurement laws and regulations, including those 

requiring the use of competitive procedures. OMNIPLEX World 

Servs. Corp., B-291105, Nov. 6, 2002, 2002 CPD 199 at 4-5. 

Tarheel, 2006 CPD 140 at *3 (emphasis added). 

29


After examining labor categories in both the Tarheel and USIS GSA MAS 

contracts, the GAO found that neither contract contained the labor categories 

solicited by the agency. With regard to Tarheel, the GAO noted: 

Tarheel’s MAS contract is for guard services and the labor categories 

that it proposed in response to this RFP were not listed in or mapped 

to the labor categories listed in Tarheel’s MAS contract. Thus, the 

agency properly determined that Tarheel’s proposal was 

unacceptable under this RFP, since the RFP required the labor 

categories to be on an applicable MAS contract. 

Id. (emphasis added). In addition, the GAO found that “USIS’s proposal should 

have been regarded as unacceptable as well because USIS’s MAS contract also 

did not contain all of the labor categories that were required to perform the RFP 

requirements.” Id. (emphasis added). The “experience,” “education” and “job 

function” requirements of USIS’s MAS contract labor categories failed to satisfy 

the experience, education and job function requirements in the agency’s order 

solicitation. Id. at *5-7. Consequently, GAO held that “it was not proper for the 

agency to place the order against USIS’s MAS contract.” Id. at *8. 

As noted above, in this case the court’s denial of Ubl’s motion in limine was 

predicated upon its erroneous view that the ordering agency (in this case, NGB) 

could vary the education and job function requirements of IIF’s GSA MAS 

contract with GSA and accept personnel who did not qualify under the labor 

category for which IIF billed GSA. If the court’s interpretation were to be upheld 

30


by this Court, the very rationale for GSA’s massive MAS contracting program, as 

explained above, would be vitiated and rendered a nullity. 

2. The Government’s Knowledge Defense Is Inapplicable In 

This Case 

In addition to discarding the bedrock of the GSA’s MAS program, the 

court’s ruling denying Ubl’s motion in limine ran far afoul of the more general 

limitations of the “government knowledge” defense. This defense has posited that 

the relevant federal agency’s full knowledge and approval of the conduct alleged to 

be false may negate the falsity or knowledge elements of a FCA violation. See 

United States ex rel. Harrison v. Westinghouse Savannah River Co., 352 F.3d 908 

(4 th Cir. 2003) (discussing government knowledge defense). 

Here, the government knowledge defense is entirely unavailable. IIF’s 

contracts were with the GSA, not NGB. The trial record established that IIF 

invoiced its unqualified IT labor force to GSA, not NGB. (See June 2001 through 

June 2002 IIF invoices billing IT contract services to GSA (J.A. 1374-75, 1381-82, 

1386-87, 1391-92, 1397-98, 1445-46, 1450-51, 1459-60, 1469-70, 1477-78, 1511- 

1512)). The record also established that IIF never told GSA that it was billing 

numerous individuals on the IT contract in labor categories for which they were 

unqualified. (J.A. 991-992). (Indeed, as discussed below, had he not been 

excluded, Ubl’s GSA expert Neal Fox would have testified that GSA would have 

cancelled IIF’s contracts had they known of IIF’s unqualified labor force). 

31

Moreover, in failing to meet its burden to prove its affirmative defense, IIF 

presented no evidence that any GSA official knew, much less approved, IIF’s 

billing of unqualified personnel at inflated rates. Yet, under the misplaced mantra 

of “government knowledge” as argued by IIF, the court permitted IIF to reduce this 

FCA case to a popularity contest over whether NGB was “happy” with IIF’s 

personnel and work. 

The government knowledge defense is only cognizable if the relevant 

government officials know of the specific falsity at issue. United States ex rel. 

Hagood v. Sonoma County Water Agency, 929 F.2d 1416, 1421 (9 th Cir. 1992) 

(“relevant government officials”); United States ex rel. Gudur v. Deloitte 

Consulting LLP, 512 F. Supp. 2d 920, 932 (S.D. Tex. 2007) (“[N]o violation exists 

where relevant government officials are informed of the alleged falsity . . . .”); 

United States ex rel. Grynberg v. Praxair, Inc., 207 F. Supp. 2d 1163, 1178 (D. 

Colo. 2001) (“known to and approved by the responsible government 

authorities.”). 


No one in NGB, including its contracting officers, is a relevant government 

official in this case because, as discussed at length in section II.A.1, supra, the 

NGB has no actual authority, express or implied, to enter into or terminate IIF’s 

GSA contracts. Likewise, NGB could not deviate or diminish the terms and 

conditions, of IIF’s GSA contracts, including the experience and education 

32


requirements of the labor categories. See United States ex rel. Stone v. Rockwell 

International Corp., 282 F.3d 787, 812, n.11 (10 th Cir. 2002), rev’d in part on 

other grounds, 549 U.S. 457 (2007) (noting that legally relevant authority for 

purposes of government knowledge defense applies to officials “with authority to 

act under the contract.”). Thus only GSA contracting officers or other GSA 

authorized representatives possess the requisite authority to be relevant 

government officials for GSA’s MAS contracts. Id.; United States ex rel. Butler v. 

Hughes Helicopters, Inc., 71 F.3d 321, 326, 328 (9 th Cir. 1995) (applying 

government knowledge authority to technical representatives). 

Likewise, NGB could not ratify or agree to IIF’s fraud upon GSA. Indeed, 

government employees, including procurement officials, lack the authority to 

waive fraudulent conduct. See United States v. Nat’l Wholesalers, 236 F.2d 944, 

950 (9th Cir. 1956) (“[W]e do not believe that the Congress ever intended that 

contracting officers should have the power to vitiate the False Claims statute.”); 

see also United States v. Cushman & Wakefield, Inc., 275 F. Supp. 2d 763, 771 

(N.D. Tex. 2002) (“A violation of the rights of the United States may not be 

waived or ratified by the unauthorized acts of its agents.”); United States ex rel. 

Mayman v. Martin Marietta Corp., 894 F. Supp. 218, 223 (D. Md. 1995) (“[A] 

government officer cannot authorize a contractor to violate federal regulations.”); 

United States v. Cripps, 460 F. Supp. 969, 973-74 (E.D. Mich. 1978) (stating that a 

33


federal employee who urges someone to defraud the government acts ultra vires). 

Moreover, because they lack the authority to waive fraud, acquisition officials 

cannot “ratify” such conduct. See John Cibinic, Jr., Ralph C. Nash, Jr. & James F. 

Nagle, Administration of Government Contracts 31, 48 (4th ed. 2006) (“[I]llegal 

actions cannot be ratified because officials lack the authority to enter into illegal 

agreements.”); cf. Winter v. Cath-DR/Balti Joint Venture, 497 F.3d 1339, 1347 

(Fed. Cir. 2007) (noting that authority is a prerequisite to ratification). 

Only GSA officials, such as the GSA contracting officers who issued the 

contracts to IIF, could have permitted IIF to forego the education and experience 

requirements of its labor categories. GSA alone administers and controls IIF’s 

GSA MAS contracts (e.g., J.A. 1330, blocks 16 and 9), and thus, GSA alone is the 

responsible and relevant government agency. That GSA is the relevant 

government agency is further demonstrated by the fact that: (1) GSA, not NGB, 

entered into the three MAS contracts with IIF, and (2) IIF knowingly submitted its 

false claims (the invoices containing the false representations that personnel 

performing services qualified for the labor category and price billed) to GSA for 

payment, not to NGB. Thus, IIF knowingly made the false claims, and the false 

statements in support of those false claims to GSA in violation of 31 U.S.C. § 

3729(a)(1)(A)-(B). Whether the NGB as the ordering agency was happy with IIF’s 

work under IIF’s GSA MAS contract or approved the IIF personnel who 

34


performed that work is immaterial as a matter of law to any government 

knowledge defense. The fact that the NGB liked IIF cannot as a matter of law 

excuse IIF from FCA liability for lying to obtain its GSA MAS contracts; and then 

using those GSA contracts to knowingly bill the GSA for unqualified labor 

delivered to the NGB at inflated rates. 

B. The Trial Court’s Error Was Immensely Prejudicial to Ubl 

As a result of the court’s erroneous denial of Ubl’s motion in limine, the 

court permitted testimony and explicit argument to the jury that NGB could select 

IIF personnel who did not qualify for the labor category and price at which IIF 

billed them so long as NGB was satisfied with the work. This testimony and 

argument was immensely prejudicial to Ubl’s case. It reduced this FCA case to the 

equivalent of a breach of contract action where the ultimate question for the jury 

was not whether IIF knowingly billed GSA for unqualified labor, but rather 

whether NGB was “happy” with IIF’s work – even if the personnel did not satisfy 

the labor category definition for the prices at which they were billed. Thus, IIF 

was allowed to present testimony that NGB was pleased with IIF’s work, and in 

the view of NGB, IIF had selected the right people for the job. See e.g., J.A.1034- 

35 [Staresina], J.A. 1083a-d [Lowman]. 

In closing argument, IIF counsel heavily emphasized this point to the jury by 

arguing that NGB personnel “were happy with IIF. IIF picks the right people for 

35

the right job,” (J.A. 1084); and that IIF fills its MAS contract labor category 

assignments with people “who can get the job done. . . . That’s what these labor 

categories are all about.” (J.A. 1084a) (emphasis added). 7 Contrary to all law and 

precedent (and, indeed, the explicit terms of IIF’s GSA MAS contracts), the court 

permitted IIF to argue to the jury that the labor categories and prices established in 

IIF’s MAS contracts: 

aren’t specific requirements. That’s not the way they were intended. 

They are pointers. They are guides to pointing towards people that 

probably have a specific capability. That’s what they are. There is 

nowhere in this Schedule application . . . do you find anywhere how 

to read those labor categories, do you find any mention that these 

labor categories are a term and condition that you cannot touch. 

(J.A. 1084b) (emphasis added). 

Thus, IIF was allowed to contend to the jury that the labor of Charles Patten 

Jr., the son of defendant Patten, who was a young man with a high school degree 

and who lacked both the four-year college degree and the four years of experience 

described in IIF’s “Analyst II” labor category, could be billed as an Analyst II at an 

Analyst II rate solely because NGB was satisfied with his work. (J.A. 1086-87). 

7 In closing argument, IIF’s counsel also made much of the fact that the NGB’s: 

(J.A. 1086). 


Major Staresina was not willing to concede that you had to have four 

years or a four-year degree. He was more concerned about can this 

individual do the job for my customer. 

36


Put simply, the court got it wrong. The court adopted a deeply flawed view 

of the fundamentals of the GSA’s MAS contracting program; and on the basis of 

this faulty premise, it permitted IIF to use an inapplicable government knowledge 

defense to turn this FCA case into nothing more than a popularity contest where 

NGB satisfaction with the IIF personnel and their work precluded any FCA 

violations for IIF’s billing of unqualified personnel at inflated rates. 

III. THE TRIAL COURT ABUSED ITS DISCRETION IN STRIKING 

UBL’S GSA EXPERT, NEAL FOX 

A. The Court Abused its Discretion in Finding Fox Was Not 

Qualified and Would Not Provide Helpful Testimony to the Jury 

As part of his case in chief, Ubl sought to introduce the testimony of GSA 

expert Neal Fox. Fox served as the GSA Assistant Commissioner for Acquisition, 

the third highest-ranking position at GSA (J.A. 985-986) from mid 2002 through 

2005. (J.A. 984, 986-987). 8 In this position, Fox directly oversaw GSA 

procurement of IT contracts and described the IT Schedule contracts as being very 

active and requiring the bulk of his time. (J.A. 986-987). Fox supervised 

approximately 50 contracting officers on the IT schedule contract, and interacted 

with and managed IIF’s contracting officers Deborah Lague and Van Tran 

8 Fox obtained a bachelor’s degree in economics and a Master’s degree in business 

administration, and took an intensive, twenty-week course in DoD procurement. 

(J.A. 983). Prior to joining GSA, he had five years of service with the Air Force, 

where he “focused on information technology procurement” and served as the 

director of Commercial Information Technology Procurement, and purchased 

information technology product and services for the entire Air Force. (J.A.984). 

37


(J.A.987, 989-990). He also directly managed the MOBIS and Environmental 

contracts (J.A. 991), and, in doing so, oversaw IIF’s IT, MOBIS, and 

Environmental contracts from 2002-05. (J.A. 996-997). 

Had Fox been permitted to testify as to the contents of his expert report, 9 he 

would have explained to the jury that based on his review of their resumes, a large 

number of employees that IIF placed on the IT contract lacked the education and 

the experience requirements necessary to qualify for any labor category on the 

contract and that other IIF employees were misclassified into higher (and pricier) 

labor categories than for which they actually were qualified (e.g., individuals 

classified as an Analyst II or Analyst III when only qualified for Analyst I). 10 

9 This was the same report that the court had previously upheld when it rejected 

IIF’s Daubert challenge claiming that Fox was not qualified and would not provide 

helpful testimony to the jury. (J.A. 141-142). 

10 As Fox explained in his expert report, a substantial number of IIF’s workforce 

was unqualified for the labor categories and prices at which they were billed to the 

GSA. Fox examined the 13 months of detailed invoices in 2001-02 provided by 

IIF during discovery. The invoices contained summaries for each of IIF’s 

employees, including the hours that they worked and the labor category in which 

IIF classified and billed them. IIF employed approximately 55 individuals during 

this time, but provided resumes for only 21 of them in discovery. Fox examined 

these resumes to determine if the individuals possessed the appropriate education 

and experience to meet the labor category requirements. Approximately half were 

either completely unqualified for any labor category or underqualified for their 

assigned labor category. (J.A. 163,165-166) (Fox Report at p. 2 and Ex. 1 to 

Report). Ubl’s damages expert, Thorn McDaniel, based his damages report on 

Fox’s findings. (J.A. 225-227, 1023-24). 

38

Despite Fox’s vast experience, knowledge, and training in GSA procurement 

and the nature of IT services, the court prevented him from testifying as to IIF’s 

unqualified labor force on the basis that he “ha[d] no practical, no personal 

knowledge of these terms and the labor categories they fit,” and that he was “not in 

nearly as qualified a position as the jury to determine the qualifications and the 

labor categories that they fit.” (J.A. 1019-1020). In so ruling, the district court 

plainly abused its discretion, and the court’s erroneous ruling deprived the jury of 

the opportunity to understand the full extent of IIF’s fraud, and to learn what GSA 

– the government entity that contracted with IIF- would have done had the agency 

known of that fraud. 

1. Standard of Review for Excluding An Expert Witness 

This Court reviews a district court’s exclusion of an expert witness for abuse 

of discretion, Garrett v. Desa Industries, Inc., 705 F.2d 721, 724 (4 th Cir. 1983), 

and the court has well established standards for evaluating whether a trial court 

abused its discretion in excluding an expert witness. First, Fed. R. Evid. 702 

states: 


If scientific, technical, or other specialized knowledge will assist the 

trier of fact to understand the evidence or to determine a fact in issue, 

a witness qualified as an expert by knowledge, skill, experience, 

training, or education, may testify thereto in the form of an opinion or 

otherwise if (1) the testimony is based upon sufficient facts or data, 

(2) the testimony is the product of reliable principles and methods, 

and (3) the witness has applied the principles and methods reliably to 

the facts of the case. 

39

This Court has held that “the use of the disjunctive indicates that a witness may be 

qualified as an expert on any one of the five listed grounds.” Friendship Heights 

Assocs. v. Vlastimil Koubek, A.I.A., 785 F.2d 1154, 1159 (4 th Cir. 1986) (citing 

Garrett, 705 F.2d at 724). “Where the expert’s qualifications are challenged, the 

test for exclusion is a strict one, and the purported expert must have neither 

satisfactory knowledge, skill, experience, training nor education on the issue for 

which the opinion is proffered.” Kopf v. Skyrm, 993 F.2d 374, 377 (4 th Cir. 1993). 

Importantly, the “subject matter of Rule 702 testimony need not be arcane or 

even especially difficult to comprehend.” Kopf, 993 F.2d at 377. See also United 

States v. Perkins, 470 F.3d 150, 155 (4 th Cir. 2006). “Helpfulness is the touchstone 

of Rule 702. The rule must be broadly interpreted.” Friendship Heights, 785 F.2d 

at 1159 (internal citations omitted). Thus, “testimony from an expert is presumed 

to be helpful unless it concerns matters within the everyday knowledge and 

experience of a lay juror.” Kopf, 993 F.2d at 377. In this case, none of the matters 

upon which Fox would have testified was within the common knowledge of lay 

jurors. 


2. The Court Abused Its Discretion in Excluding Mr. Fox 

In excluding Fox as an expert, the district court abused its discretion and 

misapplied the Rule 702 standards in three fundamental ways: 

40


First, in ruling that Fox was not qualified to testify as an expert, the court 

considered only whether Fox had specific experience in analyzing the qualification 

of employees to meet their labor category. The court ignored Fox’s many years of 

experience, knowledge, training, and skill in analyzing the requirements of IT 

contracts for the Air Force and GSA. This Court held in Garrett that a trial court 

errs in considering, as the district court did here, only an expert witness’ specific 

experience and not all of Rule 702’s five factors. Garrett, 705 F.2d at 724. 

Indeed, this Court’s decisions in Garrett and Friendship Heights demonstrate the 

very error the court committed in this case, namely, failing to recognize that an 

expert’s lack of specific experience with regard to the particular subject matter for 

which he will testify is not a basis for exclusion if, as is the case here, the expert’s 

knowledge and relevant experience in his field, and/or his training and skill in his 

field render him qualified to render an expert opinion on the subject matter. 

In Garrett, the trial court excluded an expert’s testimony as to the design and 

manufacture of a stud driver because he “had no experience in the manufacture or 

use or working of stud guns prior to [his] examination in this case.” Id. at 724. 

This Court reversed the trial court for an abuse of discretion, and held the expert 

was “qualified by his education, knowledge, training, and skill as a holder of a 

Masters degree in mechanical engineering, professional engineer, and gunnery 

officer.” Id. Notably, the Court also reasoned that: 

41

Id. at 725. 


[the expert] not only was a mechanical engineer, but he had examined and 

tested stud drivers prior to trial and had previous experience with similar 

mechanisms as a gunnery officer. The stud driver is not so complicated a 

tool that someone with [the expert’s] education and knowledge could not, 

even with his limited experience prior to this action, provide expert 

testimony. 

Likewise, in Friendship Heights, the district court refused to allow an expert 

in a construction case to opine why a building’s paint peeled, because she lacked 

“practical experience” in the properties of concrete coatings. Discussing the 

Garrett decision at length, this Court found that the record demonstrated that the 

expert had ample education, knowledge, and training necessary to opine why paint 

might peel off concrete, and held that even if the court were correct that she lacked 

“practical experience, the expert’s education, knowledge, and training qualified her 

as an expert.” Accordingly, this Court reversed the trial court for abusing its 

discretion. See Friendship Heights, 785 F.2d at 1159-60. 

The court in this case made the identical error in focusing exclusively on 

whether Fox had practical experience evaluating IIF’s labor categories. The court 

disregarded Fox’s extensive education and overlooked his twenty-week training in 

procurement. Most importantly, the court ignored Fox’s extensive experience and 

knowledge of purchasing and procuring IT services for the entire Air Force over a 

span of five years and ignored the three years Fox spent at GSA, devoting most of 

his time to overseeing the IT schedule contracts and supervising the very GSA 

42


Contracting Officers who administrated the IIF GSA MAS contracts in issue in this 

case. Fox’s extensive body of work relating to the Air Force’s IT procurement and 

GSA’s IT schedule contracts confirms that he possesses the requisite knowledge, 

training, skill, and relevant experience as to the nature and requirements of GSA’s 

IT contracts so that he could opine as to whether IIF’s employees qualified for the 

labor categories and prices at which IIF billed them. 

Moreover, as discussed in his expert report, Fox examined IIF’s labor 

category descriptions and education and experience requirements and compared 

them to the resumes of IIF employees who were supposedly performing IT 

services under IIF’s various labor categories. (J.A.162-163). Just as in Garrett, 

Fox’s evaluation of IIF’s employees’ qualifications “is not so complicated that 

someone with [his knowledge, education, training, and skill] could not, even with 

his limited experience prior to this action, provide expert testimony.” Garrett, 705 

F.2d at 725. Fox was eminently qualified to address IIF’s employees’ 

qualifications, and the court abused its discretion in holding otherwise. 

Second, the court also abused its discretion in holding Fox could not provide 

helpful testimony to the jury because examining the employee resumes was a task 

the jury could do for themselves. (J.A. 1019-20). Part of the court’s error lay in its 

misunderstanding of the nature of Fox’s analysis and the specialized knowledge 

that is needed to undertake it. Fox first determined whether each of the individuals 

43


had the minimum education and experience to meet their labor categories; then, 

Fox compared the work experience listed on an employee resume to the IT labor 

category and work descriptions for the labor category in which the employee was 

classified. Based on his experience working in IT procurement and his knowledge 

of GSA IT Schedule contracts, Fox could determine whether: (1) an individual 

possessed any relevant IT experience matching the descriptions of the labor 

category (the determination of whether the employee was unqualified) and (2) if 

the person did have some degree of relevant IT experience, whether that individual 

was placed in a higher labor category than that for which they were qualified (the 

determination of whether the employee was underqualified). 11 

This determination is no intuitive endeavor. The analysis requires a precise 

understanding of the IT skill set delineated in IIF’s labor category position 

descriptions (J.A.1314-1322). Those descriptions contain wording related to IT 

task performance that a lay jury simply would not know how to interpret. For 

instance, some of the requirements for an Analyst I (the most basic IT 

professional) are to “exercise analytical techniques when gathering information 

from users” and “devis[ing] and design[ing] computer system requirements for the 

11 For instance, Fox made a number of assessments that individuals who were 

classified as an Analyst II were underqualified and should have been classified as 

an Analyst I. (J.A. 165-166). Likewise, he made a number of assessments that 

several individuals who were classified as Senior Analyst were underqualified and 

outside the scope of IT contract. (J.A. 165-166). Fox would have testified that 

they should have been classified no higher than Analyst III at best. 

44

solution of moderately difficult business problems or for segments of more 

complex problems.” (J.A. 1316-1317). Moreover the Analyst I’s minimum 

experience requirement is defined as: 

Minimum Experience: Zero (0) to two (2) years experience in 

analysis that results in the design and development of an application, 

an analysis report, recommendation or specification in a Government 

or commercial contracting environment. 

A lay jury could not reasonably be expected to understand the meaning of this IT 

terminology. Fox’s expertise in determining whether an individual possessed the 

education and the relevant IT experience to meet these standards would have 

assisted the jury in determining whether IIF employees were unqualified or 

underqualified for the IT labor categories in which they were billed – which is 

precisely the analysis the court erroneously precluded as being unhelpful to the 

jury. 12 


An expert should be excluded as unhelpful only when he opines as to a 

matter so inherently obvious and within the jury’s common knowledge that expert 

testimony is not needed. See, e.g., Persinger v. Norfolk & Western Railway Co., 

920 F.2d 1185, 1188 (4 th Cir. 1990) (expert testimony about how difficult it is to 

lift heavy things is not “helpful” and is thus excludable); Scott v. Sears, Roebuck & 

12 The analysis by Fox would have been particularly helpful to the jury given IIF’s 

assertion that the labor category definitions in its GSA MAS contracts should be 

read in the disjunctive, i.e., as requiring either the stated experience or the stated 

education. 

45


Co., 789 F.2d 1052, 1055 (4 th Cir. 1986) (expert testimony that individuals who 

wear high heels tend to avoid walking on grates excluded as not helpful). Fox’s 

analysis clearly would have assisted the jury in a manner well beyond what they 

could have determined by their common sense alone and the court abused its 

discretion in excluding his testimony. 

Third, the court abused its discretion by twice declining Ubl’s invitation to 

permit voir dire of Fox to establish his qualifications and the helpfulness of this 

testimony. (J.A. 1011-12; 1027). This error was particularly egregious given the 

court’s statement that it had not even seen Fox’s report. (J.A. 994). Had the court 

read Fox’s report and, during voir dire inquired further of Fox, the court would 

have been able to determine the extent of his qualifications and the relevance and 

helpfulness of his testimony. Instead, the court rendered an erroneous and 

devastating ruling that irreparably damaged Ubl’s case. 

B. The Court Abused Its Discretion in Finding Fox Could Not 

Testify as to IIF’S New Defenses at Trial and Could Not Testify as 

to GSA’s Opinion of IIF’S Actions. 

The court also abused its discretion in refusing to permit Fox to testify as to 

how GSA views the new defenses presented at trial by IIF to the effect that NGB 

could vary terms of the GSA MAS contracts (by altering or ignoring) the education 

and experience requirements of the GSA’s IT, MOBIS, and Environmental 

contracts. (J.A. 994-995). This testimony was not contained in Fox’s report for 

46


the simple reason that until trial IIF never had articulated the erroneous argument 

that an ordering agency can change the GSA’s contracts. Several days before 

Fox’s trial testimony, Ubl provided notice to the district court that he intended to 

have Fox address these new IIF defenses (J.A. 661-662) but the court precluded his 

testimony as to these new issues. 

Had the court permitted Fox to testify as to GSA’s view of IIF’s action Fox 

would have explained that ordering agencies, such as NGB, have no right to 

change any of the terms of MAS contracts that IIF signed with GSA (as the MAS 

contracts clearly state). He also would have also testified that IIF never told GSA 

how they were misclassifying their unqualified labor force; and that had he known 

of IIF’s actions, he would have considered it to be an egregious fraud and 

recommended that all of IIF’s contracts be cancelled immediately. 

Fox’s experience, knowledge, and high-ranking position at GSA rendered 

him eminently qualified to provide such an opinion. Absent that opinion, IIF was 

able to present its surprise defense to the jury and to keep the jury from learning of 

how GSA in administrating its MAS contracts viewed IIF’s conduct. As a 

consequence, the jury was left with the false impression that the NGB was the 

appropriate government agency to decide whether IIF could disregard the labor 

category definitions and that IIF could charge anyone at any labor category and 

price it wished -- as long as the NGB was satisfied with IIF’s work. 

47


Under Fed. R. Civ. P. 37(c)(1), a party’s undisclosed expert opinion may be 

excluded at trial unless “the failure was substantially justified or is harmless.” 

Here Ubl was substantially justified in providing ample notice that Fox would 

testify as to IIF’s new argument that NGB could obviate the terms of the contract 

and provide a government knowledge defense. 

IV. THE TRIAL COURT ABUSED ITS DISCRETION IN PERMITTING 

IIF’S PRIVATE ACCOUNTANT TO TESTIFY AS TO GSA 

POLICIES AND PROCEDURES WHEN HE WAS NEVER 

IDENTIFIED AS AN EXPERT 

Although the trial court refused to permit Fox, a former high-ranking GSA 

official to testify as to how GSA would have viewed IIF’s actions, the court 

permitted, over Ubl’s objections (J.A. 1059), IIF’s private accountant, Robert 

Taylor, to broadly opine about the functioning of GSA’s MAS contract program 

(J.A. 1055-1058), and to claim that an ordering agency is entitled to engage 

contractor personnel at labor categories and prices for which those personnel are 

unqualified. (J.A. 1059-1060). In essence, Taylor rendered the equivalent of 

expert testimony as to the relationship between the GSA schedule program and the 

ordering agency even though he was never identified or qualified as an expert 

witness. This surprise expert opinion in the midst of trial was precisely the 

opposite of what Fox (who formerly ran the GSA’s MAS program) would have 

testified regarding labor categories and whether the contractor is required to meet 

their requirements. Moreover, as discussed in Argument II, infra, Taylor’s 

48

testimony runs completely contrary to both the provisions of the GSA contracts 

and the case law that uniformly states that an ordering agency may not vary the 

terms of a GSA MAS contract. 

The district court permitted this line of questioning, and Taylor’s testimony, 

because the court fully embraced IIF’s erroneous argument that the NGB’s 

acceptance of IIF’s unqualified labor force demonstrated government knowledge 

and therefore lack of fraudulent intent. The prejudice rendered by Taylor’s 

testimony was substantial. Having been denied the opportunity to hear from Ubl’s 

expert, Fox, as to GSA’s view of IIF’s fraudulent conduct and new defense, the 

jury was left with Taylor’s erroneous opinion that a contractor was entitled to 

disregard or vary the labor category, education and experience requirements that 

GSA had approved and that nothing IIF did in providing unqualified labor was out 

of the ordinary or improper. The court clearly abused its discretion in permitting 

this misleading and erroneous testimony. See United States v. Safavian, 528 F.3d 

957, 967 (D.C. Cir. 2008) (trial court committed reversible error by allowing one 

party to use the equivalent of expert testimony but did not grant the other party the 

same latitude). 


49


V. THE TRIAL COURT EXCLUDED RELEVANT TESTIMONY FROM 

TWO FACT WITNESSES ON THE ERRONEOUS BASIS THAT THE 

FACT WITNESSES’ TESTIMONY INCLUDED ADDITIONAL 

INFORMATION NOT CONTAINED IN THEIR DEPOSITION 

TESTIMONY 

Gigi Washington was the human resources manager for IIF in the summer of 

2002, where she reviewed the resumes of employees who were hired to work on 

the IT, Environmental and MOBIS GSA contracts and compared the education and 

experience requirements of the GSA labor category for which the employee was 

hired with the actual education and experience of that employee. In doing so, 

Washington discovered that IIF had hired numerous employees who failed to 

satisfy those GSA education and experience requirements. Over the months, 

Washington’s concerns increased until she concluded that IIF was actively 

defrauding the government, and therefore, she voluntarily terminated her 

employment. (J.A. 630-636). Washington also recalled Ubl’s voicing similar 

concerns in 2002 about improper activity in that Patten and Trimble were billing 

their time illegally to the government and working outside the office on other 

matters while billing the government. (J.A. 645, 650-653). 

When Ubl sought to introduce this testimony, IIF objected to Washington 

testifying as to these matters because her deposition testimony was inconsistent 

with this proffered testimony. (J.A. 635-636). Although Ubl’s counsel explained 

that he learned only a day or two before that Washington now recalled events more 

50

clearly than at her deposition (J.A. 637), the court excluded most of the above 

testimony, stating that “there is an ongoing obligation to notify counsel if people 

are going to change their position after they have been deposed. Discovery is an 

ongoing obligation.” (J.A. 637). 13 

Before concluding the day’s hearing after Washington testified, the court 

also instructed counsel that: 

(J.A. 657). 


if they [fact witnesses] are going to be testifying after a deposition has 

been taken and that testimony is going to change, then you are going 

to get the same ruling from me that you have gotten this afternoon 

unless you can show me that somehow you have cured any prejudice. 

In light of the court’s statement, Ubl’s counsel informed the court that 

another fact witness recently had indicated a better recollection of events than at 

her deposition and that counsel would inform IIF’s counsel as to the particulars 

after the conclusion of the day’s proceedings. (J.A. 663). Thereafter, Ubl’s 

counsel informed IIF’s counsel that fact-witness Barbara Raine, a former IIF 

employee who wrote the IIF labor categories with Mr. Patten and who observed 

the activities of Ms. Trimble, would testify that most of Ms. Trimble’s duties were 

administrative overhead and therefore, not properly billable to the government as 

IT services under the GSA contract. In addition, Raine would testify that in her 

13 Ubl thereafter was limited to asking one question to Ms. Washington, to wit: 

whether she and Ubl ever spoke about questionable practices at IIF while she 

worked there. (J.A. 653). 

51


thirty-year experience in government contracting, she routinely wrote labor 

position descriptions; that the GSA expected contractors to be bound by those 

labor category descriptions; and that GSA contractors are required to have a 

minimum experience and minimum education for a labor category. (J.A. 671-675). 

In response, IIF’s counsel telephoned (and sought to tape record with permission) 

Raine while interviewing her for 35-40 minutes. 

Claiming Raine’s testimony was “a sea change a total revamping,” IIF then 

moved to exclude her testimony. (J.A. 664, 668-669). The court granted the 

motion in large measure, excluding Raine’s testimony about Trimble’s 

administrative duties that were improperly billed to GSA and her experience 

regarding labor category requirements because her proffered testimony supposedly 

was different than her deposition and Ubl’s notification came too late to put 

defense counsel on notice of the change. 

The court reasoned that Fed. R. Civ. P. 26(e) required counsel to notify the 

opposing party if it learned that a non-party fact witness, such as Washington or 

Raine, recalled additional information following her deposition. (J.A. 674-675, 

685). The court’s ruling was plainly erroneous and an abuse of discretion that 

precluded the introduction of highly probative testimony. The law is clear that the 

supplementing duties of Rule 26(e) do not extend to deposition testimony, other 

than that of expert witnesses. Moore’s Federal Practice § 26.131[1]. See also 

52


Advisory Committee Notes to Federal Rules of Civil Procedure 26(e) (“The 

revision also clarifies that the obligation to supplement responses to formal 

discovery requests applies to interrogatories, requests for production, and requests 

for admissions, but not ordinarily to deposition testimony.”). Here, important and 

relevant testimony of two critical fact witnesses that went to the heart of issues 

critical for the jury’s determination of IIF’s false billing erroneously was excluded, 

in one case even after defense counsel had the opportunity to interview the witness 

before her testimony. The court abused its discretion in excluding this highly 

probative testimony. 

VI. THE TRIAL COURT ERRED IN PERMITTING IIF TO ELICIT 

TESTIMONY THAT NGB WAS AWARE OF THE LAWSUIT AND 

HAD NOT CANCELLED IIF’S CONTRACT AS WELL AS 

INTRODUCING EVIDENCE AND ARGUMENT THAT THE 

GOVERNMENT HAD NOT SUED IIF. 

On April 18, 2008, just prior to the first scheduled trial, Ubl filed a Motion 

In Limine to prohibit IIF from presenting evidence or argument pertaining to the 

Government’s non-intervention in this qui tam action or evidence regarding its 

investigation of this matter. (J.A. 314a-d). On April 30, 2008, upon 

reconsideration, the district court granted Ubl’s motion, finding that the proposed 

evidence was irrelevant and constituted an “inadmissible commentary on the 

merits of the suit.” (J.A. 348). 

53


Nevertheless, beginning with IIF’s opening statement (J.A. 487, 488), 

through trial (J.A. 602-602a-b, 603-604, 1035-1036), and concluding with its 

closing argument (J.A. 1084, 1284c), 14 IIF repeatedly referenced and elicited 

testimony about these highly prejudicial and irrelevant matters, over Ubl’s 

objections (J.A. 474-483), by arguing that the Government, being aware of the 

allegations in the lawsuit, has not taken any steps to cancel those contracts nor has 

requested that any funds paid to the Government be returned. 

As the trial court correctly ruled in April of 2008, whether or not the 

Government (e.g., the GSA or the NGB) is directly suing IIF in this action, and 

whether or not the Government is still paying IIF despite the allegations in this law 

suit, are irrelevant to the elements of the FCA claims against IIF and constitute an 

“inadmissible commentary on the merits of this case.” Yet, those extremely 

prejudicial comments were made time and time again throughout trial. The courts 

– including this Court – uniformly have recognized the inappropriateness of these 

types of arguments. See United States ex rel. Berge v. Board of Trustees of the 

University of Alabama, 104 F.3d 1453, 1458 (4 th Cir. 1997), cert denied, 522 U.S. 

916 (1997) (“the government will not necessarily pursue all meritorious claims; 

otherwise there is little purpose to the qui tam provision permitting private 

14 During closing, IIF’s counsel stated: “How come the alleged victim, the 

National Guard Bureau, isn’t suing Mr. Patten? When have you ever heard of the 

victim of an alleged fraud still continuing to pay the alleged wrongdoer? When 

have you ever heard?” (J.A. 1284c). 

54


attorneys general.”); United States ex rel. Atkins v. McInteer, 470 F.3d 1350, 1360 

n.17 (11 th Cir. 2006) (lack of government action does not mean that it considers the 

evidence of wrong doing insufficient or the fraud allegations to be without merit); 

United States ex rel. El-Amin v. The George Washington Hospital, 533 F. Supp. 

2d 12, 22 (D.D.C. 2008) (evidence of government non-intervention and evidence 

that government continued to pay the defendant’s claims and elected not to 

exercise one of its various administrative remedies ruled inadmissible). 

The district court clearly erred in allowing IIF to argue to the jury that NGB 

continued to pay IIF and did not sue IIF based on the fraud allegations. Such 

evidence and arguments are extraordinarily prejudicial and ignore the entire 

purpose of the FCA’s qui tam provisions, i.e., to enlist insiders who can 

supplement the Government’s own fraud fighting resources. 

VII. THE TRIAL COURT ERRED IN AWARDING IIF $501,546.00 IN 

ATTORNEY FEES FOR THE TIME PERIOD OF MARCH 24, 2009 

TO OCTOBER 27, 2009. 

A. The Court Erred In Finding Ubl’s Claims to be “Clearly 

Frivolous” 

The legal and evidentiary bases for Ubl’s claims were tested and retested 

throughout the long pre-trial phase of this case and repeatedly validated by the 

district court. Specifically: 

-- The district court denied IIF’s motion to dismiss the Amended 

Complaint, because the Amended Complaint stated FCA violations 

(Dkt. 45); 

55

-- The district court denied a second IIF motion to dismiss that argued 

that the Amended Complaint should have been filed under seal (Dkt. 

287); 

-- The district court denied IIF’s motion for summary judgment because 

“the [District] Court finds numerous materials facts in dispute” 

(emphasis added) (J.A. 137); 

-- IIF then settled for $8.9 million (J.A. 435-437); 

-- When the district court refused to enforce the settlement, the case 

went to trial; 

-- At trial, Relator presented substantial evidence in support of each 

element of his claims (after which the court declined to grant 

Defendants’ Fed. R. Civ. P. 50(a) motion); 

-- The case went to the jury; 

-- The jury took approximately seven hours to return a verdict (and 

posed a written question that revealed it was carefully considering the 

Relator’s claims and related evidence); and 

-- The jury flatly rejected IIF’s punitive counterclaim against Ubl – and 

with it any notion that the Relator somehow maliciously had 

taken any IIF trade secrets. 

Nevertheless, the district court ruled that Ubl’s case was “clearly frivolous” 

under FCA § 3730(d)(4) and assessed him over $500,000 in attorneys’ fees. The 

district court repeatedly validated the legal and evidentiary bases of Ubl’s claims, 

and then after trial ruled that the same claims and evidence rendered his action 

“clearly frivolous.” The district court’s order constitutes an egregious and 

unprecedented abuse of its powers generally and FCA Section 3730(d)(4) in 

particular. 


56


In applying § 3730(d)(4), courts have “instructed that the proper legal 

standard is the one articulated by the Supreme Court in Christianburg Garment Co. 

v. EEOC, 434 U.S. 412, 421-22 (1978): 

[t]he plaintiff’s action must be meritless in the sense that it is 

groundless or without foundation. The fact that a plaintiff may 

ultimately lose his case is not in itself a sufficient justification for the 

assessment of fees. . . . [A] plaintiff should not be assessed his 

opponent’s attorney’s fees unless a court finds that his claim was 

frivolous, unreasonable, or groundless, or that the plaintiff continued 

to litigate after it clearly became so. . . . 

United States ex rel. Grynberg v. Praxair, Inc., 389 F.3d 1038, 1058 (10 th Cir. 

2004) (quoting Houston v. Norton, 215 F.3d 1172, 1174 (10 th Cir. 2000)). The 

Christianburg standard: 

is a difficult standard to meet, to the point that rarely will a case be 

sufficiently frivolous to justify imposing attorney fees on the plaintiff. 

Grynberg, 215 F.3d at 1059 (internal citation omitted). 

In applying this standard: 

it is important that a district court resist the understandable temptation 

to engage in post hoc reasoning by concluding that, because a plaintiff 

did not ultimately prevail, his action must have been unreasonable or 

without foundation. This kind of hindsight logic could discourage all 

but the most airtight claims, for seldom can a prospective plaintiff be 

sure of ultimate success. 

Christiansburg, 434 U.S. at 421-22. Hence “an award of fees under the False 

Claims Act is reserved for rare and special circumstances.” Pfingston v. Ronan 

57


Eng’g Co., 284 F.3d 999, 1006-07 (9 th Cir. 2002); see also Rafizadeh v. 

Continental Common, Inc., 553 F.2d 869, 875 (5 th Cir. 2008). 

The phrase “clearly frivolous” means having no reasonable chance of 

success. United States ex rel. Vuyyuru v. Jahdav, 555 F.3d 337, 356 (4 th Cir. 2009). 

A claim is clearly frivolous only if it is “utterly lacking in legal merit and 

evidentiary support.” United States ex rel. J. Cooper & Assocs. v. Bernard Hodes 

Group, Inc., 422 F. Supp. 2d 225, 238 (D.D.C. 2006). 

In its initial Order holding Ubl liable under FCA § 3730(d)(4), the court did 

not explain the basis for its conclusion that Ubl’s action was “clearly frivolous.” 

(J.A. 1951). Later, in its Order setting the quantum of attorneys’ fees and costs 

assessed against Ubl, the court finally offered a number of supposed rationales for 

its finding that Ubl’s action had no reasonable chance of success, Vuyyuru, 555 

F.3d at 356, and was “utterly lacking in legal merit and evidentiary support.” 

Cooper & Assocs., 422 F. Supp. 2d at 238. The district court’s reasoning is set 

forth below in italics (and found at J.A. 1284-89): 

First, with regard to Relator’s claims concerning the 

“fraudulent” nature of IIF’s labor categories, the testimony at trial, 

both by IIF employees and employees of the GSA and NGB, 

demonstrated that IIF’s labor categories were reasonable. Moreover, 

as Defendants note, it appeared that it was NGB which “had the 

responsibility for determining whether a particular employee met the 

relevant qualifications.” Def. First Brief at 9-10. Ubl proffered no 

basis for the notion that IIF’s representations in those labor 

categories rose to the level of fraud, and if anything, the evidence 

submitted at trial proved that these definitions carried neither 

58

objective falsity nor the requisite intent necessary to substantiate an 

FCA claim. Relator’s lawyers’ deposition of Katherine Jocoy of the 

GSA should have alerted them to this defect well before trial. 

This assertion by the district court is disturbingly misplaced for several 

reasons. First, the issue of whether the labor categories in IIF’s GSA contract are 

“reasonable” has never been an issue. This case is about IIF using false 

commercial sales and pricing information to obtain GSA contracts that permit IIF 

to sell certain labor categories at specific prices throughout the Government; and 

the charging of personnel at labor categories and prices for which those personnel 

were unqualified. 


Second, as discussed at length above, the court erred egregiously in 

concluding that the NGB and not the GSA “had the responsibility for determining 

whether a particular employee met the relevant qualifications” for the labor 

categories in the GSA contracts with IIF. As discussed at length (supra), the GSA, 

and not the NBG or other ordering agencies, established the labor categories and 

prices in the GSA contracts; and neither IIF, the NGB nor any other ordering 

agency could vary them. 

Third, the court’s assertion that labor category definitions are not susceptible 

of objective meaning is plainly wrong. For example, an individual either has or 

does not have the bachelor’s degree required to qualify as an Analyst II (or the four 

years of pertinent experience). Nothing could be more objectively verifiable. 

59


Patten and his son admitted at trial that the son had just graduated from high school 

and lacked both a college degree and four years pertinent experience, and yet was 

billed as Analyst II (requiring a bachelor’s degree and four years of pertinent 

experience) at an Analyst II price. 15 

Finally, GSA Contracting Officer Jocoy said nothing to suggest otherwise – 

and nor could she, as the acquisition of a bachelor’s degree (or not) and a number 

(of years’ experience) are objectively verifiable. The issue of whether labor 

category definitions are read in the conjunctive or disjunctive is immaterial 

because the vast majority of IIF’s unqualified employees were billed under labor 

categories for which they met neither. Ms. Jocoy stated (with respect to an Analyst 

I example) that the individual must satisfy both the Experience and Education 

requirements. (J.A.733-734). Similarly, GSA’s Ms. Tran, who evaluated IIF’s 

original proposal, testified that IIF could provide whomever it wanted under its 

GSA schedule contracts “as long as they fulfill those three requirements: 

education, functional responsibility, and experience. We don’t look at people. 

We look at the labor category description.” (J.A. 949) (emphasis added). In any 

15 It is disturbing that the court found “no basis for the notion that IIF’s 

representations in those labor categories rose to the level of fraud” when IIF 

admittedly was billing (as just one example) the time of this recent high school 

graduate at a labor category and price for an individual with a bachelor’s degree 

and four years’ pertinent experience. 

60


event, the deposition that purportedly should have “alerted” Ubl to any defect was 

taken three days before the start of trial, on October 16, 2009. 

Second, Relator’s allegations regarding IIF’s putative knowing 

submission of a fraudulent commercial price list was similarly 

baseless. Like Ms. Jocoy’s deposition, Relator’s lawyers’ deposition 

of Ms. Van Tran of the GSA should have alerted Relator to the defects 

in his claim premised on the commercial price list, as the commercial 

price list is not typically relied upon and it is commonplace in the 

industry for a contracting company to list labor categories in their 

price lists even if they have not sold all of those categories previously. 

The court ruled that the price list was “not typically relied upon” by GSA 

Contracting Officers, and hence, a case premised in part upon the false pricing data 

therein was “clearly frivolous.” In fact, IIF’s fabricated and backdated commercial 

price list was one of the explicitly-stated “Bas[e]s for Negotiation and Award” of 

the GSA contract. (J.A. 1332-1333). Contracting Officer Lague, who awarded the 

IT contract, explained that an offeror’s provision of false commercial pricing 

information was capable of affecting her award decision and that if she discovered 

such false information she would “recommend no award.” (J.A. 506-509). 

Ms. Tran acknowledged that the GSA demands an offeror’ commercial price 

list to determine “what kinds of discounts they are offering to other customers.” 

(J.A. 947-948). She stated that labor category vendors typically do not have price 

lists, in which case the GSA “only look[s] at those labor categories that have been 

sold.” (J.A. 948). Ms. Tran specifically confirmed that the IIF price list was “part 

of the contract” (i.e., the GSA MAS IT contract awarded to IIF) (J.A. 952) 

61

(discussing trial exhibit 114) (J.A. 1330-32); and further that the GSA relied on the 

“service matrix,” which is based on IIF’s reported commercial sales (J.A. 952-53) 

(discussing “service matrix” in trial exhibit 114) (J.A. 1330), which sales in turn 

were purported to be based on the commercial price list that the GSA explicitly 

declared to be a basis for the IT contract award to IIF (and indeed incorporated into 

the IT contract itself). The “service matrix” is based upon the commercial pricing 

data reported in IIF IT contract offer. See Trial Ex. 113 at IIF 3854. (J.A. 1303). 

The commercial data reported includes IIF’s supposed “list” prices for offered 

labor categories. Id. Those “list” prices match (and are derived from) the fictive 

prices in the fake IIF commercial price list. See Tr. Ex. 113 at IIF 4004. (J.A. 

1329). 


Furthermore, Ms. Tran, whose testimony was relied upon by the court in 

finding that Ubl should have known in March of 2009 that his claim was baseless, 

was deposed during the trial of this matter in October of 2009. Nevertheless, the 

court assessed sanctions based on this testimony, effective approximately seven 

months earlier in March of 2009. 

Third, Relator claimed that IIF fraudulently represented that 

there were hourly rates “on” particular purchase orders in its IT 

Schedule application. The evidence at trial indicated that the work 

IIF did for Amerind implicated hourly rates even if the purchase 

orders failed to specifically list those rates. Even if this act were 

construed to be a mistake on IIF’s part, elevating it further to the level 

of fraud is simply implausible. Rather, Ubl’s claims proved to be 

premised on Ubl’s own hypertechnical construction of whether IIF 

62


listed rates “on” purchase orders, rather than any objectively 

persuasive evidence. 

IIF did not sell to Amerind specific labor categories at specific hourly rates, 

and yet it reported to the GSA that it had done so. There were no labor categories 

or labor category prices “on” the Amerind purchases to IIF (which were introduced 

into evidence), and yet IIF told GSA that there were. GSA Contracting Officers 

rely on offerors to provide accurate commercial sales and pricing information in 

order to negotiate and award GSA contracting containing “most-favored customer” 

prices for subsequent Government-wide sales of these items at the vetted prices. 

Specifically, when a contractor has substantial commercial sales of the service or 

supply proposed for inclusion on a MAS contract, the GSA uses an abbreviated 

method to evaluate the proposed price for the service or supply pursuant to FAR 

Part 12. Offerors proposing such commercial services or supplies do not need to 

submit “cost or pricing data.” 48 C.F.R. § 2.101. Instead, they are required to 

disclose their past commercial sales of the services or supplies and associated 

discounting practices; and to submit their current published commercial price list. 

As the Comptroller General has explained: 

[T]he purpose of the standard clause requiring submission of current 

published commercial price lists is to ensure that offered discount 

practices for items listed on the FSS are based on prices that have 

been tested by the offeror in the commercial marketplace. We further 

noted that the additional requirement that offerors certify to 

substantial commercial sales of the item goes the extra step of 

ensuring that its item prices have not merely been offered to the 

63

commercial public – leaving open the possibility that the prices were 

rejected by the market-place – but that the prices have been 

reasonable enough to generate sales of the items. 

Sanford’s Domestic/International Trade, B-230580, B-230580-2 88-2 CPD 214 

(Sept. 6, 1998). 


Given the above framework for the GSA’s vetting and setting of the items 

and prices prior to agency ordering, the GAO has emphasized that the prior sales 

reported in the offer to obtain an MAS contract must be sales of the actual items 

proposed. Thus, in Koehring Cranes & Excavators, B-245731.2, B-245731.3, 92- 

3 CPD 362, where the FSS contract awardee’s item, (i.e., a scrap handler) 

proposed for inclusion in a FSS contract differed from those it had sold 

commercially, the GAO did not view this distinction to be “hypertechnical:” rather, 

it agreed that the pricing of the awardee’s prior sales could not be used to negotiate 

and set the price for the items proposed for inclusion on the FSS contract, sustained 

the protest, advised the agency to terminate the improperly awarded FSS contract, 

and recommended payment of attorney fees to the protester. 

In Todd-Phelps Sporting Goods Mfg. Corp., Todd-Phelps submitted a 

proposal that including its commercial catalog supposedly containing the items it 

proposed to sell under the solicited FSS contract. Todd-Phelps, GSBCA Nos. 

5496-D, 5501-02-D, 80-1 B.C.A. 14,441. The GSA discovered that this 

“commercial” catalog was only a Government catalog (id. at *11) and debarred 

64

Todd-Phelps. Todd-Phelps pleaded guilty to criminal false statements under 18 

U.S.C. § 1001. Id. at *16. IIF did precisely the same thing here, and yet the court 

not only minimized this as “hypertechnical,” but ruled that that it was “clearly 

frivolous” for Ubl to suggest otherwise. 

The GSA Contracting Officer who awarded the IT contract, Deborah Lague, 

testified that IIF’s accurate submission of commercial pricing information was 

required because the GSA was obligating taxpayer dollars and needed to ensure 

that the prices contracted with GSA were “fair and reasonable.” (J.A. 505). She 

explained that an offeror’s provision of false commercial pricing information was 

capable of affecting her award decision, that if she discovered such false 

information she would “recommend no award,” and that if she discovered that an 

offeror had lied about “past sales,” “past pricing” or “past performance,” she 

would “recommend no award.” (J.A. 506-509). In other words, if the Contracting 

Officer who awarded the IT contract to IIF had she discovered that IIF had 

provided the false sales and pricing information, she would “recommend no 

award.” 


Lastly, Relator’s claims regarding the falsity of IIF’s 

representations about TMCI’s authorization of a 60-hour work week, 

the “negotiated” discounts with TMCI, and IIF’s reporting of labor 

categories and rates it had sold to TMCI all proved groundless. At 

most, some of these allegations proved to be oversights on IIF’s part, 

but Relater demonstrated no basis for the assertion that any of these 

acts rose to the level of knowingly fraudulent behavior. 

65


Ubl alleged that IIF reported to GSA commercial prices based on 

supposedly negotiated discounts for a 60-hour work week with a company 

called TMCI, and asked GSA to not take those lower labor rates into 

account in determining a fair and reasonable MSA contract price (J.A. 

1302). In his case in chief, Ubl presented (for example) TMCI’s Chief 

Operating Officer Robin Davis’ testimony that there simply were no such 

discounts, (much less negotiated discounts) and that TMCI never authorized 

IIF to work a 60 hour work week in exchange for their discounted labor 

rates. (J.A. 617). Ubl also introduced the TMCI proposal, the TMCI 

contract and the TMCI invoices, all of which revealed no such discounts and 

no authorization for IIF to work a 60 hour work week. (J.A. 1088, 1096, 

1133). Davis’ testimony and the pertinent documentary evidence therefore 

demonstrated that there were no negotiated discounts with TMCI on the 

basis of TMCI’s authorization for IIF to work a 60 hour work week, as IIF 

falsely represented to the GSA in its IT contract proposal, and these 

“discounted labor rates” never should have been excluded when determining 

IIF’s proper hourly rates. There was no basis for the court’s finding that 

these representations were mere “oversights” and certainly, the issue was 

properly one for a jury. 

66

In sum, the court’s explanations for finding Ubl’s claims to be 

“clearly frivolous” betray a fundamental misunderstanding of the pertinent 

law; and they misstate and ignore the evidence relating to those 

explanations. More generally, the court’s explanations ignore the fact that 

the court itself found that this same evidence (actually, less evidence) 

demonstrated “numerous” factual disputes material to valid FCA claims and 

ignore the high legal standard for “clearly frivolous” under Section 

3729(b)(4). 

B. The Court Erred In Finding that As of March 24, 2009 Ubl 

Should Have Known That He Had No Reasonable Chance of 

Success 

In its Orders of December 4, 2009 (J.A. 1951) and April 28, 2010 (J.A. 

2008), the court determined that Ubl should have known that his case clearly had 

no chance of success as of March 24, 2009, when IIF sent a letter to Judge Jones 

purportedly withdrawing from the settlement agreement. (J.A. 395a-c). The court 

erred in finding that the March 24, 2009 letter put him on notice that he could not 

succeed in this case, and indeed, there was no reasonable basis for him to have ever 

so concluded. 16 


First, the trial court failed to take into consideration that IIF’s defense of 

NGB “government knowledge” was novel, incorrect as applied in this case and not 

16 

There is nothing in the March 24, 2009 letter (J.A. 395a-c) touches upon the 

specific merits of the case. 

67

even part of this case until the beginning of trial in October 2009. See Argument 

II, supra. As set forth in the court’s April 28, 2010 Memorandum Opinion, the 

premise that IIF’s labor categories were not a basis for fraud arose from the trial 

court’s mistaken belief that “as Defendants note, it appeared that it was NGB 

which had the responsibility for determining whether a particular employee met the 

relevant qualifications.” (J.A. 1987). 

Moreover, the court erroneously relied upon the deposition of Katherine 

Jocoy of the GSA for the proposition that her testimony should have alerted Ubl to 

the lack of fraud well before trial. However, Ms. Jocoy’s deposition de bene esse, 

which was read to the jury, occurred on October 16, 2009, just three days before 

trial. (J.A. 1739). 


Similarly, the court erroneously concluded that the knowing submission of a 

fraudulent commercial price list was not a basis for a fraud allegation, relying on 

the de bene esse deposition testimony of Ms. Van Tran of the GSA. Yet, Ms. Van 

Tran’s deposition was taken in the middle of trial on October 21, 2009, (J.A. 

1784), so her testimony could not have put Ubl on notice regarding the commercial 

price list issue, even if she correctly testified, which she did not. 

As to the third ground set forth by the court for its finding that the case was 

frivolous (J.A. 1988), the court erroneously posited that IIF’s misrepresentation as 

to its prior hourly rates were simply a “mistake” or that Ubl was basing his claim 

68


on a “hypertechnical” construction of GSA requirements, and, hence, that IIF’s 

misrepresentations did not mean the misstatements were fraudulently made. 

Similarly, as to the fourth ground set forth by the court as its basis for sanctioning 

Ubl, the court erroneously characterizes IIF’s misstatements that it had 

“negotiated” a rate discount with TMCI for a 60-hour work week proved, at most, 

in the court’s opinion, to have been “oversights.” (J.A. 1988). Yet, the facts 

regarding both of these matters (and their being false representations) were 

basically undisputed, so if the lack of fraudulent intent was so clear, then the issue 

could have been easily raised by way of a summary judgment motion. Similarly, 

IIF’s claim that the NGB had the responsibility for determining whether a 

particular employee met the relevant qualifications for a labor category could also 

have been easily put at issue in the early stages of the proceedings (by summary 

judgment). IIF had no need to wait for trial. If NGB could decide whether an IIF 

employee met the GSA labor category definition, even when the employee did not, 

then all IIF had to do was present this issue to the court by way of a motion for 

summary judgment on or before March 24, 2009. But, IIF did not do so because 

(1) this was a new strategy just instituted by their new counsel at the beginning of 

trial in October 2009, and (2) IIF’s counsel evidently understood that such a 

proposition was legally and factually baseless. 

69


Finally, none of these false statements were “technical defects” as the court 

concluded, especially where it was proven at trial (for example) that Defendant 

Patten’s son, then a recent high school graduate, was billed as an Analyst II 

requiring a college bachelor’s degree and/or four years of IT experience. It defies 

credulity that Patten Sr could have believed that Patten Jr.’s five-month IT course 

was the equivalent of a four year college degree or four years of IT experience. 

Similarly, it defies credulity for Patten Sr. to claim that he had no knowledge that a 

backdated commercial price list used to obtain his GSA MAS contract was not 

improper. Ubl had more than good cause to believe that IIF’s so called “technical 

defects” were knowingly done or undertaken in reckless disregard for the truth. 

This evidence alone was sufficient for Ubl to have alleged fraudulent intent, and 

the court’s conclusion to the contrary was clear error. 

For all of these reasons, the trial court clearly erred and abused its discretion 

in awarding attorney fees from March 24, 2009. 

C. Defendant’s Fees For the Five Attorneys Billed Were 

Unreasonable 

In tailoring the attorney fees award, the court ignored the fact that this case 

was set to commence trial on May 6, 2008 when at the very last minute, a 

Settlement Agreement was entered into between Ubl and IIF and Patten. Yet, with 

no further discovery, and minimal pre-trial hearings before the second trial date, 

the court concluded that spending nearly 3000 hours defending this case was 

70

easonable (totaling over $500,000 in fees) for time expended between March 24 

and October 27, 2009. (J.A. 2005) (Table 2). The court went so far as to 

commend defense counsel for reducing its over 900 multi-page trial exhibits 

(totaling over 20,000 pages) down to less than 100 exhibits for trial. (J.A. 1992). 

That defense counsel unreasonably filed over 20,000 pages of exhibits and then 

pared them down hardly makes that action and the fees associated therewith 

reasonable. 


Moreover, although this case was set for trial in May, 2008, there are dozens 

and dozens of additional meetings with multiple attorneys all charging for their 

time, and yet the court merely reduced those fees by 10%. (J.A. 1993, 2006). 

A review of the fee petition of Mr. Workmaster reveals little of substance 

except repeated tasks of “continued trial preparations” or “continued preparing trial 

outline” in the hundreds of hours. (Dkt. 366, Exhibit H.). 

Mr. Cynkar’s petition (Dkt. 366, Exhibit F) similarly contains repeated 

entries such as: “undertook miscellaneous trial preparation tasks” or 

“miscellaneous trial issues” with most entries identifying conferences and 

telephone calls with co-counsel. 

For all of these reasons the court abused its discretion in finding it 

reasonable for counsel to have expended almost 3000 hours between March 24 and 

71

October 27, 2009 in defending this case which had previously settled on the day of 

the scheduled trial. 

CONCLUSION 

Based on the foregoing individual arguments or based upon the cumulative 

error doctrine, see United States v. Basham, 561 F.3d 302, 330 (4 th Cir. 2009), the 

orders of October 27, 2009, December 4, 2009 and April 28, 2010 should be 

vacated and the case remanded for enforcement of the settlement agreement or a 

new trial. 


Oral Argument is requested. 

Respectfully Submitted, 

/s/ Victor A. Kubli 

Victor A. Kubli 

KUBLI & ASSOCIATES, P.C. 

8605 Westwood Center Drive 

Vienna, Virginia 22182 

(703) 749-0000 

Michael S. Lieberman 

Stephen Stine 

DIMURO GINSBERG, P.C. 

908 King Street, Suite 200 

Alexandria, Virginia 22314 

(703) 684-4333 

Counsel for Appellant 

72


CERTIFICATE OF COMPLIANCE 

1. This brief complies with the type-volume limitation of Fourth Circuit Order 

filed June 24, 2010, granting Appellant leave to file a brief not in excess of 

17,500 words. 

[ X ] this brief contains 17,327 words, excluding the parts of the brief 

exempted by Fed. R. App. P. 32(a)(7)(B)(iii), or 

[ ] this brief uses a monospaced typeface and contains [state the number 

of] lines of text, excluding the parts of the brief exempted by Fed. R. App. P. 

32(a)(7)(B)(iii). 

2. This brief complies with the typeface requirements of Fed. R. App. P. 

32(a)(5) and the type style requirements of Fed. R. App. P. 32(a)(6) because: 

[ X ] this brief has been prepared in a proportionally spaced typeface using 

Microsoft Word 2000 in 14pt Times New Roman; or 

[ ] this brief has been prepared in a monospaced typeface using [state 

name and version of word processing program] with [state number of 

characters per inch and name of type style]. 

Dated: July 1, 2010 /s/ Victor A. Kubli 

Counsel for Appellant

CERTIFICATE OF FILING AND SERVICE 

I hereby certify that on this 1st day of July, 2010, I caused this Brief of 

Appellant to be filed electronically with the Clerk of the Court using the CM/ECF 

System, which will send notice of such filing to the following registered CM/ECF 

users: 

Robert J. Cynkar Christopher I. Kachouroff 

CUNEO, GILBERT & LADUCA, LLP DOMINION LAW GROUP, P.C. 

106-A South Columbus Street 12741 Darby Brooke Court, Suite 202 

Alexandria, Virginia 22314 Lake Ridge, Virginia 22192 

(202) 789-3960 (703) 365-9900 

Counsel for Appellees Counsel for Appellees 

Jason N. Workmaster 

McKenna, Long & Aldridge, LLP 

1900 K Street, Nw 

Washington, DC 20006 

(202) 496-7422 

Counsel for Appellees 

I further certify that on this 1st day of July, 2010, I caused the required 

number of bound copies of the foregoing Brief of Appellant and Joint Appendix to 

be hand-filed with the Clerk of this Court and for a copy of the Joint Appendix to 

be served, via UPS Ground Transportation, to all case participants, at the above 

listed addresses. 


/s/ Victor A. Kubli 

Counsel for Appellant

United States Court of Appeals

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?