United States ex rel. Fisher v. Network Software Associates

227 F.R.D. 4, 60 Fed. R. Serv. 3d 1109, 2005 U.S. Dist. LEXIS 2545, 2005 WL 417746
CourtDistrict Court, District of Columbia
DecidedFebruary 22, 2005
DocketNo. Civ.A.99-3095PLF/JMF
StatusPublished
Cited by12 cases

This text of 227 F.R.D. 4 (United States ex rel. Fisher v. Network Software Associates) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

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United States ex rel. Fisher v. Network Software Associates, 227 F.R.D. 4, 60 Fed. R. Serv. 3d 1109, 2005 U.S. Dist. LEXIS 2545, 2005 WL 417746 (D.D.C. 2005).

Opinion

MEMORANDUM OPINION

FACCIOLA, United States Magistrate Judge.

This case was referred to me for discovery by Judge Friedman pursuant to LCvR 72.2(a). Currently pending and ready for resolution are three discovery motions. For the reasons stated herein, Defendants’ Motion to Stay Discovery [# 110] is denied, Relator’s Request for Scheduling Order and Motion Under Fed.R.Civ.P. 56(f) Relating to Defendants’ Motion for Partial Summary Judgment and Stay [#111] is granted in part and denied in part, and Defendant Network Software Associates, Inc., A Virginia Corporation’s Motion for Protective Order [# 118] is granted in part and denied in part.

[6]*6I. BACKGROUND

A. Factual Background

From November 23,1993, through July 18, 1997, Network California, NetSoft, and Network Virginia were involved in the U.S. Small Business Administration (“SBA”), Section 8(a) Minority Small Business Development Program (“Section 8(a) Program”). Third Amended Complaint and Demand for Jury Trial (“Complaint”) 1Í1Í1, 38-41. This program allows federal agencies and entities to “set aside” certain contracts for the sole benefit of the Section 8(a) Program participants. Id. 1126.

Relator brings this suit against defendants under the False Claims Act (“FCA”), 31 U.S.C. § 3729 et seq. Relator claims that defendants presented false claims, false statements, and false records and engaged in a conspiracy to enter into the Section 8(a) Program and obtain government contracts with little to no competition. Id. 111.

B. Defendants’ Motion for Partial Summary Judgment

On July 23, 2004, defendants filed a motion for partial summary judgment. While this motion is currently pending before Judge Friedman, it is necessary to refer to it in order to understand the discovery motions currently pending before me.

In their motion, defendants explain that relator’s third amended complaint contains allegations that defendants made false claims and statements to enable defendants to fraudulently obtain certain contracts and transactions. These contracts and transactions include: (1) contracts that the SBA set aside for entities owned and controlled by disadvantaged persons pursuant to the SBA’s Section 8(a) Program, (2) contracts through the General Services Administration (“GSA”) Schedule (“GSA Schedule Sales”), (3) open-market purchase orders with the government totaling between $2,500 and $100,000 (“Small Purchases”) and purchase orders valued at under $2,500 (“Micropurchases”), and (4) contracts with companies that subsequently made sales to the federal government (“Subcontracts”). Statement of Points and Authorities in Support of Defendants’ Motion for Partial Summary Judgment (“Def.’s Mot. Partial Summ. J.”) at 1.

Defendants explain that relator’s claims stem from defendants’ alleged false certifications of eligibility as a small, disadvantaged business under the Section 8(a) Program. Id. at 1-2. Defendants also note:

Relator’s suit does not challenge the fact that NSA was a bona fide “small business” under applicable Government regulations. Only NSA’s status as a small, disadvantaged business under the Section 8(a) Program is challenged. It is undisputed that NSA was at all operative times during the Limitations Period a legitimate small business under the governing regulations.

Id. at 2 n. 1.

Defendants further explain that their motion for partial summary judgment is limited to relator’s claims based on GSA Schedule Sales, Small Purchases and Micropurchases, and Subeontracts-not any claims based on defendants’ participation in the Section 8(a) Program. Defendants acknowledge that, with regard to these three types of contracts, an entity’s “small business status” is a relevant consideration under the federal regulations, but an organization’s small business status is distinct from its Section 8(a) or small, disadvantaged business (“SDB”) status. Defendants then argue that “[t]he rules governing these transactions during the Limitations Period establish conclusively that NSA’s 8(a) or SDB status was not material to award or payment, and such status could therefore not have been a condition of payment under the FCA....” Id. at 11. Because FCA liability does not attach unless the violations of the law were a prerequisite to gaining a benefit from the government, and because defendants read the complaint as alleging claims based only on NSA’s Section 8(a) or SDB status (not their small business status), defendants claim that the alleged violations cannot yield FCA liability. Accordingly, defendants seek a ruling by the court granting their motion for partial summary judgment and dismissing with prejudice relator’s claims concerning the GSA Schedule Sales, Small Purchases and Micro-purchases, and Subcontracts. Id. at 29.

[7]*7II. DISCUSSION

A. Defendants’ Motion to Stay Discovery

Defendants move this court for an order staying discovery until the court rules on their joint motion for partial summary judgment. Defendants contend that a stay is appropriate because, if the court grants their motion for summary judgment, many of relator’s claims will no longer be at issue in this ease, and the scope of discovery will be significantly limited. Defendants represent that, at the time they filed their motion to stay, there were no outstanding discovery requests and that they had already produced extensive discovery. Statement of Points and Authorities in Support of Defendants’ Motion to Stay Discovery. (“Def.’s Mot. to Stay”) at l.1

B. Relator’s 56(f) Motion

Relator opposes the motion to stay and contests defendants’ representation that they have met their discovery obligations. Relator’s Request for Discovery Scheduling Order and Motion Under Fed.R.Civ.P. 56(f) Relating to Defendants’ Motion for Partial Summary Judgment and Stay (“Rel.’s 56(f) Mot.”) at 1, 10. Relator also states that he “requires additional discovery of facts essential to his position” and requests additional discovery under Federal Rule of Civil Procedure 56(f). Id. at 1. Specifically, relator seeks additional discovery regarding “whether [djefendants’ falsification of NSA’s size status was ‘a prerequisite to obtaining a government benefit.’” Id. at 3 (citing United States ex rel. Hopper v. Anton, 91 F.3d 1261, 1266-67 (9th Cir.1996)). Relator further argues that, “[ajlthough [djefendants’ false certifications of ‘small’ business status were material as a matter of law, the factual issue of the states of mind of scores of government contracting officials

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227 F.R.D. 4, 60 Fed. R. Serv. 3d 1109, 2005 U.S. Dist. LEXIS 2545, 2005 WL 417746, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-ex-rel-fisher-v-network-software-associates-dcd-2005.