March 18, 2013 4th Circuit published opinions

United States v Woods

Woods was convicted of multiple counts of tax fraud and identity theft. He appealed arguing his right to testify was unreasonably restricted, that a prosecutor’s statement in closing argument that he lied under oath was improper and that the jury charge failed to cover his good character and misstated elements of some of the identity theft charges. The panel affirmed. It held that the district court provided leeway to Woods to testify about facts and “themes” that he desired. I held that the prosecutor’s statements were plain error and admonished the government to stop making these kinds of remarks. However, because the documentary evidence against Woods and the evidence from 20 tax filers and identify theft victims coupled with the inconsistencies in his testimony was overwhelming evidence of guilt. The panel held the character charge should have been given as Woods offered character evidence and the government’s attempts to undermine that evidence was done in violation of circuit precedent and the issue was for the jury in any event. However, the panel held the error was harmless based on the same reasoning as for the improper argument. The panel held the jury instructions for identity theft accurately conveyed the law as to the definition of knowledge and the requirement to act without lawful authority. The panel again condemned the government’s misconduct in this case, but, held the cumulative effect did not undermine the verdict and affirmed all convictions and sentences.

United States ex rel. Carter v Halliburton Co.

Carter filed a qui tam case claiming Halliburton overcharged the government for contract work in Iraq. His first two complaints were dismissed. His third was also dismissed on statute of limitations and first to file grounds. The panel, with one judge dissenting in part, reversed and remanded. The majority held that the wartime statute of limitations suspension applied during undeclared warts as the statute applies when the country is “at war” not “at declared war”, declarations no longer are passed and the United States Supreme Court ruled that the laws of war apply in undeclared wars. The statute does not exclude realtor filed cases and there has been no proclamation or concurrent resolution ending the period of war. Thus, the third complaint was timely filed. The majority joined all other circuits to decide the issue and adopted the “same material elements” test to determine if two or more qui tam claims are related for purposes of determining which case is filed first. It held that third complaint and other cases filed in Texas and California all related to a scheme of falsely claiming labor costs when workers did not do work. Thus, they had the same material elements. However, the Texas and California cases have both been dismissed and there is no bar to Carter filing another case for his qui tam claim. The majority remanded for the district court to determine if the public disclosure bar applied to this claim. One judge concurred noting the plain language of the limitation suspension statute applies to realtor and government qui tam fraud suits and if congress wants to exclude realtor suits, they can amend the statute. The dissenting judge first agreed that the first to file bar does not bar suit here. However, he argued that the suspension statue does not mention realtor claims and thus, like the 4th Circuit held in a case about another statute extending the limitations period, the better reading is to limit the suspension statute to government initiated cases. Additionally, legislative history demonstrates that the suspension statute was passed out of concern that during war law enforcement is diverted to fighting espionage and other war related crimes and thus will not have the resources to fight fraud in war contracts. Finally, the majority’s reading creates incentives to delay realtor suits as the limitations period can be indefinitely suspended and claims will increase in value over time.

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