Mountain Law: Wheels of justice continue to spin for Lance Armstrong in fraud case
March 15, 2017
A recent ruling by a federal judge paved the way for a lawsuit against cyclist Lance Armstrong filed by his former teammate, Floyd Landis, and later joined by the federal government, to proceed to trial under a law known as the False Claims Act.
The FCA is considered the government's primary tool to combat fraud by federal contractors. It goes back to the civil war where President Lincoln promoted it to stop war profiteering. The plaintiff in an FCA case must prove that the defendant committed fraud against the government regarding a federal contract. Significantly, the law has a "whistleblower" provision that allows a private citizen to sue on behalf of the federal government and collect a bounty if the case is successful.
To recap the events that brought us here, the United States Postal Service sponsored a professional cycling team owned by a company called Tailwind and its predecessors from 1996 through 2004. Johan Bruyneel was the team's manager. Armstrong was the team's lead rider and he won six straight Tour de France titles between 1999 and 2004. The USPS paid Armstrong a total of about $32 million. The sponsorship agreement required the team members to follow the rules of cycling's governing bodies, which prohibited doping by using certain performance-enhancing substances and methods.
For many years, including during the period of USPS sponsorship, Armstrong denied doping. However, in 2012, one of cycling's governing bodies, the U.S. Anti-Doping Agency, issued a report concluding that Armstrong used banned performance-enhancing substances starting in at least 1998 and continuing throughout his professional career. Accordingly, the USADA disqualified all Armstrong's competitive results since 1998, including his Tour de France victories, and banned him from sport for life pursuant to the World Anti-Doping Code. Armstrong continued to deny doping for a time but then conducted a televised interview with Oprah Winfrey in 2013, where he admitted doping throughout his career, starting in the mid-1990s. There, he admitted engaging in banned practices during each of his Tour de France victories, including the six he won as a USPS rider.
Landis was Armstrong's USPS teammate from 2002 through 2004. There was reportedly bad blood when Landis left the USPS team to lead the rival Phonak Cycling Team. Landis won the 2006 Tour de France but was likewise stripped of the title after testing positive for banned substances. At that time, Armstrong had not yet admitted doping or been stripped of his own titles, and it's been suggested that Landis resented Armstrong continuing to be hailed as a hero while Landis suffered scorn. In any event, Landis filed the FCA suit against Armstrong, Bruyneel and Tailwind in 2013 and the federal government joined the suit shortly thereafter. If the suit is successful, the government will receive triple damages totaling more than $100 million and Landis will collect a multi-million-dollar bounty.
Armstrong clearly doped and lied on countless occasions to cover it up. One of his defenses is a claim that USPS received more value from the sponsorship than what it paid him, so there are no damages for purposes of the FCA. The government responds that USPS didn't receive fair value and suffered damages from having its brand tarnished by the doping. In February the presiding federal judge denied Armstrong's motion to dismiss the case. If the case doesn't reach a settlement, a jury will decide the outcome.
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There are no heroes in a case where one admitted doper stands to gain millions of dollars at the expense of another admitted doper. The whole thing seems like a slow-motion peloton crash. Greg LeMond officially remains the only American to have won the Tour de France.
Noah Klug is owner of The Klug Law Firm, LLC, in Summit. He may be reached at 970-468-4953 or Noah@TheKlugLawFirm.com.