Qui Tam Whistleblower Michael Lindley Alleges Gallup Defrauded U.S. Government
Qui Tam Whistleblower Lawsuit Against Gallup Organization Joined by U.S. Government
Washington, D.C. The U.S. Department of Justice has joined a whistleblower qui tam lawsuit charging the Gallup Organization with perpetrating a multi-million dollar fraud in its contracts with the Department of the Treasury and the Department of State. The lawsuit is captioned U.S. ex rel. Lindley v. The Gallup Organization, Case No. 1:2009-cv-1985 (D.D.C. filed Oct. 21, 2009). Lawyers representing whistleblower Michael Lindley say that they intend to work with the government to prosecute the case and recover moneys that Gallup allegedly overcharged the taxpayers, and also to hold the company accountable for firing Lindley when he tried to stop the fraud.
Lindley, Gallup’s former Director of Client Services, filed the lawsuit under the False Claims Act in the United States District Court for the District of Columbia on October 21, 2009. Gallup hired Lindley in 2008 and honored him in January 2009 as “Rookie of the Year,” only to fire him six months later after he discovered the alleged widespread fraud on the government and insisted that Gallup put an immediate end to the wrongdoing.
Remarking on the significance of the Government’s intervention decision, whistleblower attorney Janet L. Goldstein, one of Lindley’s lawyers, explained, “The Justice Department intervenes in fewer than one out of every four whistleblower False Claims Act lawsuits filed. Its decision to proceed with False Claims Act charges against Gallup here strongly suggests that, in the Justice Department’s view, the company that calls itself ‘the most trusted name in polling’ may have violated the public trust.”
The lawsuit, which was brought on Lindley’s behalf by Washington D.C.-based qui tam law firm Vogel, Slade & Goldstein, LLP and whistleblower law firm Katz, Marshall & Banks, LLP, charges that Gallup defrauded the U.S. government by grossly inflating cost estimates that were provided to and used by federal agencies to set prices on Gallup’s sole-source contracts. According to qui tam attorney Robert L. Vogel, one of Mr. Lindley’s attorneys, when the government negotiates the price of a non-competitive contract, the government often relies on the contractor to submit honest estimates of its projected costs. The lawsuit asserts that, instead of submitting honest cost estimates, Gallup routinely inflated its projected costs and submitted those inflated costs estimates to the government, which enabled Gallup to garner huge profits from its government business. The Government has intervened on the allegations that Gallup violated the False Claims Act with respect to contracts with the U.S. Mint and State Department.
Lindley’s complaint, which was originally filed under seal and has now been made public, also accuses Gallup of corrupting the integrity of the government contracting process by offering a Gallup partnership to the director of FEMA’s Human Capital Division. According to the complaint, at the same time Gallup was engaged in pre-job-offer discussions with the FEMA official, the official was recommending to agency officials that FEMA fund a subcontract with Gallup. Although the Government has not intervened on Lindley’s claim that Gallup violated the False Claims Act in connection with the FEMA subcontract, the Government has stated that it intends to file other claims related to that subcontract.
The Department of Justice’s decision to intervene in Lindley’s action and to assume primary responsibility for the case follows a two-and-a-half year federal investigation of Lindley’s allegations by the DOJ.