Tour de Fraud? Lance Armstrong Settles FCA Claims Related to Doping Scandal
On April 19, 2018, former
professional cyclist Lance Armstrong announced that he and the government reached
a $5 million agreement to settle long-running FCA claims alleging he defrauded
the government by submitting false claims for millions of dollars in United
States Postal Service (“Postal Service”) sponsorship payments while lying about
his use of Performance Enhancing Drugs (“PEDs”). The $5 million was a small
fraction of the nearly $100 million in treble damages the government had
sought.
Armstrong, known for his
record seven consecutive Tour de France wins, was stripped of his titles in
2012 by the United States Anti-Doping Agency (“USADA”) after the Agency
concluded that there was “undeniable proof” that Armstrong not only used PEDs
himself but was the “ringleader” of the widespread and systematic use of PEDs among
Postal Service cycling team members. In addition to being stripped of his
cycling victories, he was banned from any further participation in professional
sports. This finding was later affirmed by the International Cycling Union. Originally,
Armstrong vehemently denied allegations of doping, even going so far as to
bring a libel suit against the Times of London and its source, a former team
masseuse, for publishing accusations of doping activities. However, in 2013, he
admitted to use of PEDs during a televised interview with Oprah Winfrey.
The $5 million settlement
resolves allegations against Lance Armstrong that were brought by Floyd Landis,
one of his former Postal Service cycling teammates, who also admitted to using
PEDs while on the team. Landis claimed that Armstrong, directly and through
team managers and spokesmen, made numerous false statements to the government
denying PED use in order to convince the Postal Service to renew its
sponsorship of the cycling team in 2000 and later to increase the sponsorship
amount due to Armstrong’s 1999 and 2000 results in the Tour de France. Landis also
alleged that Armstrong took active steps to conceal his doping for the duration
of the Postal Service sponsorship and beyond, including lying under oath about PED
usage during a 2005 arbitration regarding his entitlement to a bonus for his
2004 Tour de France win.
Although
the government independently investigated Armstrong for potential federal
crimes connected to the doping scandal and declined to bring charges, it
intervened in Landis’s qui tam case in
2013. Since that time, Armstrong combatted the FCA claims by arguing that the
government could not prove it suffered any harm as a result of his
misrepresentations, pointing to evidence that the Postal Service actually made
$163.7 million as a result of the sponsorship. The case had been scheduled to go
to trial in May of this year. As part of the settlement, Floyd Landis will
receive $1.1 million for his role in bringing the claims against Armstrong
forward.