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United States ex rel. Cohen v. City of Palmer

United States District Court, D. Alaska

July 15, 2014

THE UNITED STATES OF AMERICA ex. rel. ARLENE COHEN, Relator, Plaintiff,
v.
CITY OF PALMER, ALASKA, a Political Subdivision of the State of Alaska, Defendant.

ORDER RE MOTION TO DISMISS

SHARON L. GLEASON, District Judge.

Before the Court at Docket 47 is Defendant City of Palmer's Motion to Dismiss Second Amended Complaint ("SAC"). Palmer asserts the SAC should be dismissed with prejudice under Federal Rules of Civil Procedure 12(b)(6) and 9(b).[1] The motion has been fully briefed.[2] Oral argument was not requested by either party and was not necessary to the Court's decision. For the reasons set forth below, the motion will be granted and the SAC dismissed. Leave to amend will be granted only with respect to the stockpiling claim; the remaining claims will be dismissed with prejudice.

BACKGROUND

Arlene Cohen initiated this False Claims Act ("FCA") case on October 7, 2011 as Relator on behalf of the United States against the City of Palmer, Alaska.[3] She contends that beginning in 2009 and continuing through sometime in 2011-2013, Palmer violated the FCA in its use of American Recovery and Reinvestment Act ("ARRA") grant funds for two public works construction projects: a water main replacement project and a wastewater treatment plant improvement project.[4] On August 27, 2012, the United States declined to intervene.[5]

On November 9, 2012, Ms. Cohen filed the First Amended Complaint ("FAC").[6] On August 26, 2013, this Court issued an Order granting Palmer's motion to dismiss the FAC, with partial leave to amend.[7] The Court began by discussing the FCA's public disclosure rule, which bars an FCA action brought by a private individual if the allegations were "publicly disclosed"-unless the individual is an "original source" of the information.[8] The Court explained that the statute that sets out the public disclosure rule was amended effective March 23, 2010. Under the prior version of the statute, public disclosure deprived a court of subject matter jurisdiction, but under the amended version, public disclosure is grounds for dismissal.[9]

Relying on the prior version of the statute, the Court dismissed with prejudice Ms. Cohen's pre-March 23, 2010 ("pre-March 2010") claims for lack of subject matter jurisdiction. The Court found that the allegations forming the basis of these claims had been publicly disclosed, and that Ms. Cohen was not an original source of the information.[10]

With respect to the post-March 23, 2010 ("post-March 2010") claims, the Court did not address public disclosure. Instead, the Court found that these "claims... do not pass muster under Federal Rules of Civil Procedure 9(b) and 12(b)(6)."[11] The Court dismissed the claims with leave to amend.[12] The Court stated that Rule 9(b) requires a complaint to identify "the who, what, when, where, and how" of the alleged misconduct.[13]

In September 2013, Ms. Cohen's counsel withdrew from representation.[14] Ms. Cohen, now self-represented, filed the SAC on October 22, 2013.[15] The substance of the SAC does not differ materially from the FAC. In fact, many of the sentences in the first 14 pages of the SAC are identical to those set out in the 11-page FAC, although the SAC is a bit more detailed.[16] The remaining 31 pages of the SAC focus primarily on Ms. Cohen's investigation and her contention that she is an "original source" of the information forming the basis of her FCA claims against Palmer.[17]

Palmer moved to dismiss the SAC on January 6, 2014.[18] Ms. Cohen opposed on February 3, 2014, [19] and Palmer replied on February 25, 2014.[20] In March 2014, Ms. Cohen's former counsel reentered an appearance in this action, but he has made no other filings.[21]

DISCUSSION

I. Jurisdiction.

This Court has jurisdiction over the SAC's post-March 2010 claims under 28 U.S.C. § 1331 and 31 U.S.C. § 3732(a).

II. Standard of Review.

An explanation of the dismissal standard under Federal Rules of Civil Procedure 12(b)(6) and 9(b) is set forth in the ...


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