FOR IMMEDIATE RELEASE CIV
TUESDAY, DECEMBER 7, 2021
REMARKS AS PREPARED FOR DELIVERY BY ASSISTANT ATTORNEY GENERAL TONY WEST AT PRESS CONFERENCE ANNOUNCING MAJOR SETTLEMENTS WITH PHARMACEUTICAL MANUFACTURERS
Good morning and welcome. My name is Tony West, and I’m the Assistant Attorney General for the Civil Division of the Department of Justice. In that capacity I oversee much of the federal government’s civil litigation across the country. I am pleased this morning to be joined by three great colleagues and friends: Carmen Ortiz, the United States Attorney for the District of Massachusetts; Wifredo Ferrer, the United States Attorney for the Southern District of Florida; and Dan Levinson, the Inspector General of the Department of Health and Human Services.
Over the last two years, the Justice Department—in close collaboration with the Department of Health and Human Services—has made cracking down on health care fraud a top priority. Today, we announce the latest results of those efforts. We have reached significant settlements with three drug companies—Abbott Laboratories, Inc.; Roxane Laboratories, Inc.; and B. Braun Medical, Inc.—settlements that will collectively return more than $421 million to the Medicare and Medicaid programs. These settlements stem from lawsuits in which we’ve alleged that these companies engaged in a complicated and complex scheme to market their drugs through an unlawful pricing arrangement that amounted to kickbacks funded by taxpayer dollars.
Now before my colleagues and I describe the details of this elaborate scheme, let me note that these cases are the latest in a string of settlements, judgments, convictions and fines that are part of Attorney General Eric Holder’s aggressive effort to combat fraud in all its forms over the last two years. In fact, I’m pleased to announce, that since January 2009, the Civil Division, working closely with our U.S. Attorney partners around the country, has recovered more money lost to fraud than ever before—over $9 billion in civil and criminal cases involving fraud on American taxpayers and consumers; a staggering and unprecedented amount that represents the largest two-year fraud recovery in the Department’s history.
The cases that make up that record-breaking amount cover the full spectrum of Civil Division fraud cases: from the financial fraud cases like mortgage fraud that victimize homeowners who are already struggling to hold on to their homes; to procurement fraud cases involving substandard provisions supplied to our troops in Iraq and Afghanistan; to the investor fraud scams involving fake business opportunities that cheat honest small businesspeople out of their hard-earned investments. Together, these cases represent an aggressive, coordinated and sustained effort at the federal level to hold perpetrators of fraud accountable, be they large companies or individuals –and over the last two years we have done just that.
Over half of that record-breaking sum—more than $5 billion—is comprised of health care fraud cases like the settlements against Abbott, Roxane and B. Braun we are announcing today.
These three cases involve something called the AWP, or “Average Wholesale Price.” That’s the price companies report to published national pricing lists as the price of their drugs. The government uses these same price lists to pay health care providers who purchased those drugs for their Medicare and Medicaid patients.
Now this was the honor system: companies were supposed to report the Average Wholesale Price they were actually charging for their drugs, but in fact, we allege, that’s not what they did. Instead, the AWP reported by these defendants—the same prices used by the government to pay providers—were greatly inflated. This allowed drug companies to create an incentive for the purchase of their drugs, since buyers could pay the drug companies one price and obtain government payment at an inflated price and pocket the difference—essentially a kickback scheme funded by taxpayer dollars. Not only did this practice cost our public healthcare programs millions of dollars, it also threatened to undermine the integrity of the choices health care providers made for their patients.
In fact, this practice within the pharmaceutical industry was widespread—so much so that instead of Average Wholesale Price, “AWP,” it was jokingly said, really stood for: “Ain’t What’s Paid.” Indeed, the only purchasers who paid the inflated, reported drug price were you, the American taxpayers.
Now, this was a very complicated and hard-fought case that required years of tireless, persistent and dedicated work by our lawyers, paralegals and investigators here in the Civil Division, in the U.S. Attorneys Offices for Massachusetts and the Southern District of Florida and in the HHS Office of Inspector General, especially over the last three years. Without them, this important victory for our public healthcare programs would not have occurred. It’s a reminder of the high commitment to public service our federal civil servants embody.
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Justice Department employees packed the Great Hall on Wednesday morning to give First Lady Michelle Obama a rousing greeting as she thanked them for their service.
Since her husband took office last year, Obama has visited several government agencies to thank federal employees for their service.
DOJ staffers filed into the standing-room-only Great Hall as early as 7:30 a.m. Others took up posts on the third-floor balcony above the auditorium. When Obama emerged from the rear of the stage just after 11:30 a.m., a sea of cameras and phones sprang up from the crowd to capture the moment. Later, shrieks rang out when Obama approached the crowd to shake hands with career attorneys and top-ranking DOJ officials.
The greeting was so warm, in fact, that Attorney General Eric Holder offered the First Lady a job at DOJ.
“I can tell you that, like the president, she has a brilliant legal mind,” Holder said. “I have been so impressed by her legal skills that I’m going to make her an offer — right now — to join the best lawyers in the world, right here at DOJ.”
The First Lady praised both the Attorney General and the work of the employees of the Department of Justice.
“One of the privileges of being First Lady has been the opportunity to visit so many agencies over the past year or so so that I can thank all of you, really, for the hard work and dedication that you’ve all put in,” Obama said. “You put in long hours. And a lot of people look at the President, they look at your boss, and they say, well, you’re working hard. But the truth is — and we all know this — you all are putting in that kind of time as well. You’re making sacrifices. You miss time with your families. And often, you do it without getting any recognition from anyone.
“So I want to let you know how much that we value everything that you’re doing here, however long you’ve been doing it,” she added.
Obama also gave a shout-out to those who work outside Justice Department headquarters — Bureau of Alcohol, Tobacco, Firearms and Explosives employees, FBI agents, U.S. Marshals and the U.S. Attorneys.
Justice Department employees Celeste Simmons, Janean Bentley, and Cee Cee Simpson Allaway said they were the first three to arrive at 7:30 a.m.
“It was worth it, I would do it again anytime,” said Simmons, an investigator in the Civil Rights Division’s Disability Rights Section who has been with the department for 15 years.
They were joined by Sabrina Jenkins, a fellow employee in the Disability Rights Section, and Angela Parks of the Criminal Division. All said they were thrilled to meet and shake hands with the First Lady and showed off pictures they took of Obama.
Joining the First Lady and the Attorney General on stage were some of the Justice Department’s longest serving employees, including Jack Keeney, Deputy Assistant Attorney General in the Criminal Division, who at age 88 still holds an office at DOJ headquarters.
The other long-serving employees on stage were: Civil Division trial attorney Marshall T. Golding, who joined DOJ in April 1957; FBI employee Earl F. Hostetler Jr., who began his career in June 1961; Justice Management Division security specialist Barbara J. Russell, who began her career with the Department of Justice in July 1961; Civil Division legal assistant William H. Wiggins, who has been with DOJ since December 1963; FBI telephone operator Mary C. Smith, who entered the FBI in June 1964; FBI support services technician Marcia M. Taylor, who began her FBI career in September 1965; Civil Division mail clerk Eugene W. Crane, who started his career at DOJ in January 1966; Civil Division Appellate Staff Director Robert E. Kopp, who has served since August 1966; Justice Management Division Procurement Analyst Patricia Ann Belcher; Civil Rights Analyst Myra D. Wastaff; and Senior Counsel for Appeals in the Criminal Division Sidney Glazer.
Officials seated in front of the crowd included Acting Deputy Attorney General Gary Grindler, Associate Attorney General Thomas Perrelli, and Assistant Attorneys General Tony West, Christine Varney and Ronald Weich.
Story updated at 4:45 p.m.
Attorney General Eric Holder and First Lady Michelle Obama’s remarks are available below.
Good morning. Thank you all for being here today to help me welcome our nation’s First Lady – and my good friend – to the Department of Justice.
In the recent past, including many miles on the campaign trail, I’ve had the pleasure of getting to know our First Lady. And I can tell you that, like the President, she has a brilliant legal mind. I have been so impressed by her legal skills that I’m going to make her an offer- right now- to join the best lawyers in the world, right here at DOJ.
I’ve also learned that she has a deep appreciation for the work and many responsibilities of the Justice Department. But what’s impressed me most, and what I admire most about her, is her commitment to justice.
Many of you already know her extraordinary story – that she grew up in a small apartment on the South Side of Chicago and, with hard work, determination and the support of a loving family, made her way to Princeton University, then Harvard Law School, then on to one of the nation’s premier law firms. And she decided long ago – long before she became First Lady – that she wanted to harness the power of the law to generate positive social change and build a more just society.
That commitment took her in unexpected directions. As she once put it – and I know many of you feel this way, too – she realized that she, “wanted to have a career motivated by passion and not just money.” And so she built on her legal training to serve communities, assemble volunteers, and – despite the pay cut – spend her time inspiring young people to enter public service themselves.
And did I mention that it was because of the law that she met a certain summer associate – and her law firm mentee – who would change her life? She has said that she, and I quote, “wasn’t expecting much” of the young Harvard Law student who everyone else was raving about. But shortly after they met, our President summoned all the charm he could muster - and all the moves he had – and apparently it worked. From that time on, our First Lady has been, not only a distinguished attorney, executive, and community leader, but also, in her husband’s words, “the rock” of her family. Indeed, she does seem to do it all: lawyer, advocate, visionary and, above all, the mother of two wonderful daughters, a supportive and engaged wife, and a wonderful daughter herself.
Over the past year and a half, the First Lady has also become “the rock” of our nation – a committed, and already accomplished, force for positive change, especially for young people. Last month, I had the privilege to join her in Detroit, where she kicked off a day of mentoring and called on young students to work hard and, just as important, to give back. And her “Let’s Move!” campaign to eliminate childhood obesity is already creating a healthier – and, in a very real sense, more just – America.
But her commitment and her tireless efforts don’t stop there. She also works to support military families, to serve as a role model for working women, to promote the arts and arts education, and – of course – to continue to make sure that my boss still takes out the trash. That can’t still be true!
When I think about the First Lady, I’m struck by the fact that, though I’ve only known her for a few years, it feels like so many. That’s the kind of friend our speaker is. From the day we met, she has made me feel welcome and at home. And so in that same spirit, I’d like us to welcome her to our home here at the Department of Justice. Ladies and gentlemen – the First Lady of the United States, Michelle Obama.
MRS. OBAMA: Thank you. Thank you so much. (Applause.) Thank you, everybody. Thank you. Such a warm and wonderful welcome. I am thrilled to be here.
I want to start by thanking our outstanding Attorney General, Eric Holder, your boss, for that very kind introduction, and also for the wonderful work that he’s doing here at the Department of Justice. He is — I could say the same accolades as he said about me. He’s just been a phenomenal support, not just to the President but to me personally.
As he mentioned, he joined me along with celebrities and other people from the administration in Detroit to do some very important mentoring in Detroit. And he was just amazing. I mean, you know how busy he is. And my view is that if this man can take the time out to fly and spend a day talking to young people, I mean, sitting down at a table with kids, and talking about how they can pursue their dreams, how he can use his own story to show them that they can reach for passions that maybe they thought they never could, that he, in his own role, serves as a role model. If he can do that, then we all can do that.
And I know that there’s so many of you here who are following that lead. And I’m grateful to him and I’m grateful to all of you for serving in that role. So we have to give him an incredible thank you. (Applause.)
I’m told that Eric started out as a 25-year-old law graduate — school graduate working in the Public Integrity Section here at DOJ. You were 25?
ATTORNEY GENERAL HOLDER: That was five years ago.
MRS. OBAMA: Five years ago. (Laughter.) And even though he’s been around the block a few times since then — (laughter) — only five years — he’s never lost that sense of responsibility that comes from working to uphold our highest legal principles. It’s a responsibility that all of you share, and one that some of you have been shouldering for quite a while, I understand. That’s why I want to take a moment to recognize the folks here on the stage with me. These are some of the longest-serving employees here at the Department of Justice. I don’t know the numbers here, but they’ve been here for quite some time, and I want to take some time to give them a round of applause for their dedication. (Applause.)
It’s just wonderful to see people who have made commitments for decades to government service, and it’s important for the world to see, particularly young people, to see how people are building and have built lifetimes here serving the broader community.
And I know that even though we’re here at Main Justice, I also want to recognize the men and women who serve as the faces of this agency in communities all across the country: the FBI and the ATF agents. (Applause.) The U.S. Marshals and the hardworking folks at the U.S. Attorneys offices who are on the ground every day — yay, yes — (applause) — they’re keeping us safe and protecting our most basic rights.
And when I travel, one of the great things I get to do is usually see the U.S. Attorneys on the ground. So our congratulations and thanks goes out to everyone.
One of the privileges of being First Lady has been the opportunity to visit so many agencies over the past year or so so that I can thank all of you, really, for the hard work and dedication that you’ve all put in. You put in long hours. And a lot of people look at the President, they look at your boss, and they say, well, you’re working hard. But the truth is — and we all know this — you all are putting in that kind of time as well. You’re making sacrifices. You miss time with your families. And often, you do it without getting any recognition from anyone.
So I want to let you know how much that we value everything that you’re doing here, however long you’ve been doing it, because I know we have a lot of newbies here, folks who are just joining the department as well. Yay, all right, let’s give them a round of applause, too. (Applause.)
So that’s one of the reasons I’ve been doing these visits, to make sure that you all know that even in the heat of change and all the work that goes on here, that we haven’t forgotten the work that you do and the sacrifices that you make.
These visits, though, also help me get a better understanding of what’s happening in some of these agencies, to listen, to learn about your work and to help spotlight the difference that you make in the lives of so many Americans, because when I show up, there are cameras that usually come, and I think it’s important for the people around the country to know that government is working hard for the American people and that it’s made up of everyday Americans who are making sacrifices on their behalf.
And I have to admit that I’m especially excited to be here at DOJ because we have a lot in common, many of us here. As many of you know, long before I lived in the White House, I worked in Chicago, and I did a little law thing. (Laughter.) I decided to study law for some of the same reasons many of you did. Number one, math was really hard. (Laughter.) And as my mother said, I talked a lot — (laughter) — and could write pretty good. But it’s also because I’ve seen the power that law has to change people’s lives in a very real and meaningful way. And I knew that lawyers had the ability to help turn words on a page into justice in the world –- to keep a neighborhood safe; to keep a family in their home; to leave our children a world that is a little more equal and a little more just.
And I also — as Eric mentioned — I met this guy named Barack Obama while I was studying law. (Laughter.) Yes, he was my mentee — a summer associate when I was a first-year associate. So that was a nice little perk from my law career. (Laughter.)
And here at DOJ, you all represent the ideals that drew us all to this business in the first place: those principles of equality, fairness and the rule of law. Your responsibility is not to a particular party — and that’s important for people to understand — or to a particular administration or to a President. You work for the American people. You do battle every day on behalf of the most vulnerable among us. And you touch the lives of virtually every American in ways large and small -– even if they don’t realize it.
For a department that started out with a single, part-time employee in 1789, the workload here at DOJ has really never stopped growing. And I know you all are feeling that right now.
Whether it’s keeping our nation safe from terrorist attacks, or bringing our most hardened criminals to justice, protecting consumers or safeguarding our civil rights, your work has never been more important that it is today.
That’s especially true in the wake of the worst environmental disaster that we’ve ever faced here in this nation. And I know that the Attorney General and several members of the leadership team have traveled to the Gulf, and many folks here in this agency are working tirelessly to ensure that accountability is going on, that we’re protecting taxpayer dollars, and that we’re helping those affected by the oil spill really get back on their feet.
And people need to know that the Department of Justice is at the center of that work. But it’s not just the work that you do that makes this place so special. It’s what you all bring to the work that you do. It’s the passion, and the persistence and the energy that you bring to your cases.
And I know to be here, taking pay cuts as many of you do, you’ve got to be doing it because of passion because all of you all would be at a firm somewhere if it didn’t mean something to you.
But that’s true whether you’re an attorney, a paralegal, a librarian, a support staffer — truly, the dedication that you’ve all shown is extraordinary. And I’m proud — very proud — of the work that you’ve done, and I’m extremely grateful for what you’re doing every day.
And it is not an easy job. That I know as well. But the fact that so many of you have stuck around for so long really says something about the culture of this agency.
Administrations, as you know, can come and go, but the pride that you put into your work, it never fades. As Attorney General Holder likes to say, working here isn’t just about making a living. And that’s so important for young people out there to know and to see. These jobs, it’s not about earning the dollar; it’s about making a difference in someone’s life.
And this group really takes those words to heart. I’m told that in the first six months of this year, your attorneys have taken on 20 pro bono cases -– from custody battles and landlord-tenant disputes, to domestic violence and personal injury cases. Pro bono, for those of you who don’t know, is completely free legal service.
And 50 of your attorneys, I understand, have staffed legal clinics right here in D.C., helping to write wills, to file taxes and to do other important work for members right here in this community who couldn’t otherwise afford it.
In the end, that’s really what the Department of Justice is all about. That’s really what the field of law is supposed to be about. You all help make the promise of our laws a reality for every single American regardless of their race, their standing or their political affiliation.
From the Great Hall of the Supreme Court to a folding table in a legal clinic, you help our families secure the protection that they need and the rights that they deserve. And you do it with a level of fairness and compassion that stands as an example to us all.
So for that reason, I’m here to show you, along with the rest of America, our gratitude, our admiration. These are going to be tough times. And we’re going to need every one of you to buckle up and work even harder. But it’s easier to have that conversation here because you all know what hard work means. You all know what sacrifice means.
And it’s important for us to share those values with the next generation. We need to replace you all. We need to start working on the next generation of staffers and attorneys and librarians and paralegals who are going to fill these seats in decades to come. And they’re going to do that because of the work that they see you doing. They’re going to do that because of the pride that you take in your work. We are the role models for the next generation.
So we are grateful for your work. And I just look forward to coming out there and shaking a few hands.
So thank you, thank you so much. (Applause.)
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At an event in the Great Hall Monday honoring the contributions of the lesbian, gay, bisexual and transgender community, Attorney General Eric Holder said the Justice Department is working to “[live] up to its responsibility to provide a work environment where every employee is respected and given an equal opportunity to thrive.”
Holder also pointed to the Obama administration’s accomplishments on LGBT issues including the new federal hate crimes law — the Matthew Shepard and James Byrd Hate Crimes Prevention Act that the president signed into law in October — and the Justice Department’s recent decision that the Violence Against Women Act covers same-sex partners.
“We have much to celebrate today. In the year since we last gathered, our nation – and the Justice Department – have taken steps to address some of the unique challenges faced by members of our country’s LGBT community,” said Holder in remarks at the annual DOJ LGBT Pride Month event.
DOJ Pride was founded in 1994, and flourished when Janet Reno was Attorney General. Attorneys General John Ashcroft and Alberto Gonzales later banned the group from using Justice Department facilities. Attorney General Michael Mukasey welcomed DOJ Pride back to the Great Hall in 2008, and DOJ Pride President Chris Hook said the event has grown in size since the Obama administration took over in January 2009.
During his remarks, Holder also touted the DOJ’s new Diversity Management Plan — which calls for greater diversity in such areas as hiring, promotions and retention — and the appointment of former acting U.S. Attorney for the District of Columbia Channing Phillips to manage the implementation of the plan as Deputy Associate Attorney General for Diversity.
“With this initiative, and with Channing’s leadership, we’re working to ensure that the department can effectively recruit, hire, retain, and develop a workforce that reflects our nation’s rich diversity, a department that welcomes and encourages the contributions of its LGBT employees,” Holder said.
Holder did not address some of the controversies that LGBT advocates have raised with the Department of Justice, such as the DOJ’s defense of the Defense of Marriage Act and the military’s Don’t Ask, Don’t Tell policy.
Assistant Attorney General for Civil Rights Thomas Perez introduced the keynote speaker, U.S. Attorney Jenny A. Durkan, the first openly gay federal prosecutor to head a U.S Attorney’s office.
“What a difference two years makes,” Durkan said. “Today I stand before you as the first openly gay U.S. Attorney. But I can promise you I’m not the last. In fact, today there are three Senate confirmed openly gay U.S. Attorneys in America.
“Two followed me. I started a trend. But I do want to point out, they’re all women. So guys, you need to step it up,” Durkan joked.
She also praised Holder’s work on the LGBT issues, saying that “there is nobody more committed to equality and justice across America than our Attorney General Eric Holder.”
Sharon Lubinski, the first openly gay U.S. Marshal, also spoke at the ceremony and was introduced by Sen. Amy Klobuchar (D-Minn.).
Officials in attendance at the event included Assistant Attorney General for the Civil Division Tony West; Assistant Attorney General Ignacia Moreno of the Environment and Natural Resources Division; U.S. Attorney for the Eastern District of Louisiana Jim Letten; U.S. Attorney for Minnesota B. Todd Jones; U.S. Attorney for New Jersey Paul Fishman; and Chris Dudley, Deputy Director of the U.S. Marshals Service.
DOJ Pride also gave out three awards, including to two local advocates for same-sex marriage. D.C. Councilmember David A. Catania, the force behind the law that made same-sex marriage legal in the District of Columbia, received the Gerald B. Roemer Community Service Award along with Maryland Attorney General Douglas F. Gansler. Gansler was an Assistant U.S. Attorney in the District of Columbia under then-U.S. Attorney Holder.
Hook received the James R. Douglass Award for his leadership of DOJ Pride. He took over in 2006, when the group had shrank dramatically during the Bush administration, but it has since grown back to the size it was during the Clinton administration.
Hook made it clear when he took over the organization in 2006 that DOJ Pride “did not intend to go into hiding,” said Marc Salans, Assistant Director of the Office of Attorney Recruitment and Management, who presented the award.
The event was sponsored by the Department of Justice, the Justice Management Division’s Equal Employment Opportunity staff and DOJ Pride.
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William H. Orrick has been named head of the Civil Division’s Office of Immigration Litigation.
Assistant Attorney General Tony West announced the appointment in an e-mail to staff Wednesday.
The Office of Immigration Litigation employs about 310 attorneys and 100 support staff and is divided into two sections: the Appellate Section and the District Court Section. It has jurisdiction over all civil immigration litigation and is responsible for the nationwide coordination of immigration matters before the federal district and appeals courts.
Orrick came to the Justice Department as a counselor to the Assistant Attorney General for the Civil Division in June 2009 after 25 years at Coblentz, Patch, Duffy & Bass LLP, where he was a partner.
Orrick is the son of former U.S. District Judge William H. Orrick Jr., who died in 2003 and ran the Justice Department’s Civil Division during the Kennedy administration. His grandfather, William H. Orrick, was one of the founding partners of Orrick, Herrington & Sutcliffe LLP.
The former head of the office, Juan Osuna, was recently named Associate Deputy Attorney General for Immigration Policy in Office of the Deputy Attorney General. He was appointed Deputy Assistant Attorney General for the Office of Immigration Litigation last May, and previously served as chairman of the Board of Immigration Appeals.
Attorney General Eric Holder said Monday that President Barack Obama’s fiscal 2011 budget will help address issues of sexual assault.
The event, held in conjunction with Sexual Assault Awareness Month, is the first held in the Great Hall to address the issue of sexual assault, said Associate Attorney General Thomas Perrelli.
Holder said that for the first time, the Office for Victims of Crime set aside $100 million specifically to address violence against women. It also set aside $30 million for the Sexual Assault Services Program — doubling its budget from the previous year — and an additional $9 million for the Legal Assistance for Victims Program, bringing its budget to $50 million.
“We all know what we’re up against,” said Holder. “Confronting this reality is very difficult, it’s often painful, but it’s also very important.”
“I will ensure that this department and our partners have the resources to combat sexual assault and bring offenders to justice. This issue is deeply important to me,” said Holder. “During a career spent as a prosecutor, a judge, and as a United States Attorney, I have seen the effects of sexual violence in the courtroom and far beyond. I understand how these crimes devastate lives, families and whole communities.”
Attendees at the event included Assistant Attorney General Lanny Breuer, Assistant Attorney General Laurie Robinson, Assistant Attorney General Tony West and Minnesota U.S. Attorney B. Todd Jones. Holder recognized Breuer, Robinson and West for their visits to campuses around the country to discuss violence against women and Jones for his leadership on the issue as chairman of the Attorney General Advisory Committee.
Speakers at the event included Susan B. Carbon, a former judge who assumed her duties as director of the Office of Violence Against Women on April 2, and Catherine Pierce, the deputy director of the Office of Violence Against Women.
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Defense contractor Kellogg Brown & Root Services billed the federal government for unauthorized private security guards in Iraq, the Justice Department alleged in a lawsuit.
The complaint, filed Thursday in federal district court in Washington, said 33 KBR subcontractors, as well as the company itself, used armed guards from 2003 to 2006 without approval from the Army. The company also failed to ensure that the guards were registered with the Iraqi Ministry of the Interior, as required, the department said.
Justice Department lawyers said in the complaint that the amount of taxpayer dollars lost to the alleged fraud would be determined at trial.
KBR was under contract to provide logistical support for military operations, including food services, transportation, laundry and mail. KBR and its subcontractors were required to use military protection, according to the complaint.
In addition to allegedly submitting bills with “impermissible costs” in violation of the False Claims Act, KBR is accused of flouting subcontract terms requiring travel only in military convoys, the department said.
KBR managers had expressed concerns that the Army would disallow costs for the private security contractors, but nonetheless charged the federal government for the unauthorized services, the complaint said. The company hired contractors Triple Canopy, Omega Risk Solutions, and Al Dhahir to provide security. KBR also used four of its own employees as armed security for company executives, the complaint said.
“Defense contractors cannot ignore their contractual obligations to the military and pass along improper charges to the United States,” said Tony West, Assistant Attorney General for the Civil Division, in a statement.
In statement, the company strongly denied any violations of the law, noting that it filed claims of its own against the Army in 2008 to recover funds expended on security costs. The dispute is pending before the Armed Services Board of Contract Appeals.
“The Army breached the contract by repeatedly failing to provide the necessary force protection and, in fact, frequently left KBR, its employees and its subcontractors unprotected,” KBR said in the statement. “The absence of security provided by the U.S. Army made it more difficult and costly for KBR to fulfill its obligations.”
The complaint is embedded below.
In a move that is expected to speed up fraud investigations, Attorney General Eric Holder has signed an order allowing U.S. Attorneys to issue civil investigative demands under the False Claims Act.
The civil investigative demand is a potent administrative subpoena that covers documents, depositions and interrogatories. The Justice Department can issue CIDs before it files a complaint or until it joins a qui tam action — a lawsuit filed by a private citizen on behalf of the federal government — and thus before a potential defendant can conduct its own discovery.
Until January, only the Attorney General could approve CIDs, and, consequently, they were used sparingly. But in May 2009 Congress passed an anti-fraud bill that, among other things, allowed him to delegate the power to the Assistant Attorney General for the Civil Division, Tony West. In a Jan. 15 order, Holder also permitted West to redelegate the authority to U.S. Attorneys, with a notice and reporting requirement.
The final rule will be published in Wednesday’s Federal Register.
Here is the key passage on CIDs:
Authority relating to Civil Investigative Demands issued under the False Claims Act is hereby delegated to United States Attorneys in cases that are delegated or assigned as monitored to their respective components. In accordance with guidelines provided by the Assistant Attorney General, each United States Attorney must provide notice and a report of Civil Investigative Demands issued by the United States Attorney. When a case is jointly handled by the Civil Division and a United States Attorney’s Office, the Civil Division will issue a Civil Investigative Demand only after requesting the United States Attorney’s recommendation.
The Fraud Enforcement and Recovery Act of 2009 also gave the Justice Department more freedom to share information gleaned from CIDs with whistleblowers and federal and state agencies, effectively acting as a force multiplier. West has said he expects more frequent use of the CIDs, combined with greater information-sharing, to quicken the case flow, allowing the government to recover more tax dollars lost to fraud.
The Justice Department has recovered more than $3 billion in False Claims Act cases since January 2009.
Earlier Wednesday, Justice Department officials confirmed to FoxNews the list of DOJ attorneys dubbed the “al-Qaeda Seven” — a group of lawyers lambasted in a Keep America Safe advertisement who represented Guantanamo detainees prior to their government service.
Surprisingly, that list includes Assistant Attorney General for the Civil Division Tony West, despite the fact that his representation of “American Taliban” John Walker Lindh has long been public knowledge.
In 2002, West joined a team of lawyers that represented Lindh. He discussed the case on a chat with The Washington Post back in 2002 and has appeared in numerous news articles as one of Lindh’s lawyers.
“West’s representation of Lindh is probably his best-known work, and was prominently mentioned in the ledes of several articles reporting on his nomination,” writes Media Matters.
West’s representation of Lindh was brought up during his confirmation hearing in March 2009, but few voiced any opposition to his nomination at that time. Ultimately only four Republican senators voted against West’s nomination. Sen. Charles Grassley (R-Iowa), who has pressed for information on the detainee lawyer issue, voted in favor of West’s confirmation.
Although West was not identified by name, on Feb. 18 Assistant Attorney General for the Office of Legislative Affairs Ronald Weich publicly acknowledged West’s role in the Lindh case. In a letter to Grassley, Weich wrote that “the Assistant Attorney General for the Civil Division previously represented one Afghanistan detainee, and his former employer represents other detainees.”
A spokesman for Keep America Safe said that disclosing solely the position of someone who represented terrorism suspects - even if there is only one person who fit such a description - is not good enough.
“If you only give the position and not the name, it’s another barrier to disclosing information that should be readily available,” Aaron Harison of Keep America Safe told Main Justice.
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Fox News has identified the seven anonymous Justice Department lawyers who previously represented Guantánamo detainees or terrorism suspects.
Justice Department spokesman Matthew A. Miller confirmed the names to Fox News’ Mike Levine, but did not say whether any of the seven previously anonymous lawyers now work on issues related to Guantánamo detainees.
“Each of the nine people referenced in the letter filed legal briefs that are available by using something as simple as Google,” Miller told Fox News. “We will not participate in an attempt to drag people’s names through the mud for political purposes.”
Miller said “politics has overtaken facts and reality” in the battle over the lawyers’ identities. (Full statement below)
The current Justice Department employees who previously represented Guantánamo detainees or terrorism suspects are:
- Tony West, the Assistant Attorney General for the Civil Division.
- Jonathan Cedarbaum, of the Office of Legal Counsel.
- Eric Columbus, senior counsel in the Office of the Deputy Attorney General.
- Karl Thompson, of the Office of Legal Counsel.
- Joseph Guerra, Principal Deputy Associate Attorney General.
- Tali Farhadian, an official in the Office of the Attorney General.
- Beth Brinkmann, Deputy Assistant Attorney General in the Civil Division.
Two other DOJ lawyers — Principal Deputy Solicitor General Neal Katyal and National Security Division Attorney Jennifer Daskal - also formerly represented detainees, but their identities had already been known.
In response to the DOJ confirmation, Keep America Safe spokesman Aaron Harison said the organization still wants information on which of the lawyers works on detainee issues within the DOJ.
“The American people have a right to know whether lawyers who voluntarily flocked to Guantanamo to take up the cause of the terrorists are currently working on detainee issues in President Obama’s Justice Department,” Harison said. (Full statement below)
Details about the DOJ lawyers’ involvement in Guantánamo detainee cases are available in the article, which also points out that the Justice Department hired several lawyers who represented Guantánamo detainees during the George W. Bush administration.
Main Justice’s previous coverage of the controversy:
- DOJ Info Center Swamped With Calls After Cheney Ad Released
- Spokesman: Ad Only Questioning Pro Bono Lawyers
- Around the Web: Reaction to Cheney Video
- Conservative Group’s Ad Hammers Holder on Detainee Lawyers
- GOP: Holder “Intentionally Evasive” on Lawyers with Detainee Ties
Miller’s full statement:
“On February 18, the Department sent a letter to Senators about political appointees who were involved in detainee-related litigation before joining the Department. As the letter stated, Department attorneys are subject to ethics and disclosure rules as required under both Department guidelines and the administration’s own ethics rules, which are the strongest in history.
“In the time since we sent that letter, politics has overtaken facts and reality. Each of the nine people referenced in the letter filed legal briefs that are available by using something as simple as Google. The names the Department is being asked to disclose are already in the public record, and can be easily found by anyone.
“We will not participate in an attempt to drag people’s names through the mud for political purposes. One of the hallmarks of our nation’s legal system is that attorneys provide faithful representation to all sorts of clients. As John Roberts said at his confirmation hearings, it is wrong to identify lawyers with the client or the views the lawyer advances for the client, and our history is replete with such examples, from John Adams representing British soldiers to Department of Defense JAG lawyers representing Guantanamo detainees. Department of Justice attorneys work around the clock to keep this country safe, and it is offensive that their patriotism is being questioned, just as it was offensive when people questioned the patriotism of JAG lawyers representing detainees or the Supreme Court Justices who, by majority votes, ruled in favor of detainees in cases during the previous administration.”
Keep America Safe spokesman Harison’s full statement:
“Today, after much public outcry, the Department of Justice finally and reluctantly disclosed the names of the Al Qaeda Seven. We regret that they still refuse to tell the American people whether any of these lawyers are currently working on detainee issues inside the Department. The American people have a right to know whether lawyers who voluntarily flocked to Guantanamo to take up the cause of the terrorists are currently working on detainee issues in President Obama’s Justice Department. Attorney General Holder’s assertion that hiring former terrorist lawyers is just like hiring lawyers who used to defend white collar criminals demonstrates once again that, despite the President’s rhetoric, the Obama Administration does not understand the dangers of treating terrorism like a law enforcement matter.”
This story has been updated.
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Mary Smith has been appointed to the Justice Department’s Civil Division pending the outcome of her long-stalled nomination to lead the Tax Division, a Justice official said.
She is expected to begin work on Wednesday as Senior Counsel to Assistant Attorney General Tony West, the official said.
Her nomination has been controversial. Republican senators have complained of Smith’s lack of tax law experience, but Democrats have defended her, saying her past work as an in-house counsel at Tyco International and as a DOJ trial attorney qualifies her for the post.
Smith was a trial attorney in the Civil Division in the 1990s, before leaving to work on President Bill Clinton’s reelection campaign. She later worked in Clinton’s White House counsel’s office. After she left government, Smith was senior litigation counsel for Tyco during a class action against the company that ended in $3 billion settlement.
Most recently, she was a partner at the Chicago law firm Schoeman, Updike & Kaufman.
In the front office, Smith will be advising West on division organization and coordinating with other offices, among other duties, the official said. She was appointed to the Civil Division, rather than the Tax Division, because nominees are barred from handling matters in the office to which they are nominated.
Smith may be in the Civil Division for awhile. Republican Sen. Richard Shelby of Alabama has placed a blanket hold on all nominations pending on the Senate Executive Calendar, over concerns he has about a tanker contract that could bring 1,500 jobs to Mobile, Ala., and over funds he is requesting to build an FBI counterterrorism center in his state.
The Senate panel approved Smith on a party line vote last June, but in the face of Republican opposition, her nomination never reached the Senate floor. The nomination was returned at the end of the session in December. President Barack Obama renominated her this year, and she again moved through committee on a party line vote last Thursday.