Appeals court affirms dismissal of False Claims Act case against city over transportation funding certifications.
Today in Detroit
The U.S. Court of Appeals for the Sixth Circuit has upheld a lower court's decision to grant summary judgment in favor of the city of Detroit in a False Claims Act lawsuit brought by two whistleblowers. The whistleblowers, Gregory Lynn and Paulette Hamilton, had alleged that Detroit made false certifications to receive transportation funding from the U.S. government.
This case highlights the challenges whistleblowers can face in proving fraud against government entities, even when they believe taxpayer funds have been misused. The appeals court's ruling suggests that forward-looking contractual promises, like the certifications made by Detroit, may not be subject to False Claims Act liability.
The whistleblowers, Gregory Lynn and Paulette Hamilton, are principals of a paratransit services provider called Enjoi Transportation. They alleged that Detroit made false certifications to the U.S. government in order to receive transportation funding. However, the appeals court agreed with the lower court's decision, stating that Detroit's certifications were forward-looking promises that do not constitute fraud under the False Claims Act.
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