http://www.rawstory.com/showarticle.php?src=http%3A%2F%2Fwww.washingtonpost.com%2Fwp-dyn%2Fcontent%2Farticle%2F2007%2F03%2F27%2FAR2007032700894_pf.htmlCourt Rules Against Whistle-Blower
By MARK SHERMAN
The Associated Press
Tuesday, March 27, 2007; 4:15 PM
WASHINGTON -- The Supreme Court left an 81-year-old retired engineer without a penny to show for his role in exposing fraud at a former nuclear weapons plant in a ruling that makes it harder for whistle-blowers to claim cash rewards.
James Stone stood to collect up to $1 million from a lawsuit he filed in 1989 against Rockwell International, now part of aerospace giant Boeing Co., over problems with environmental cleanup at the now-closed Rocky Flats nuclear weapons plant northwest of Denver.
A court eventually ordered Rockwell to pay the government nearly $4.2 million for false claims the company submitted. Stone could have received up to a quarter of Rockwell's payment, under the False Claims Act.
But Justice Antonin Scalia, writing in the 6-2 ruling Tuesday, said Stone was not entitled to recover any money because he lacked "direct and independent knowledge of the information upon which his allegations were based." Scalia said Stone had little connection to the jury's ultimate verdict against Rockwell.
The company must pay the entire penalty anyway. The only question before the court was whether Stone would get a cut.
The outcome was cheered by business groups that wanted the court to limit whistle-blowers in false claims lawsuits. Since Congress reinvigorated the Civil War-era law in 1986, those suits have returned $11 billion to the government. Recent high-profile cases include settlements with leading pharmaceutical manufacturers.
Robin Conrad, senior vice president of the U.S. Chamber of Commerce National Chamber Litigation Center, said the decision "is a very important victory for every government contractor."
The decision will cause whistle-blowers, or relators, to think twice before they file false claims lawsuits, said Peter B. Hutt II, an expert in false claims lawsuits in Washington.