Employer – Employee : False Claims Act – Fraudulent Inducement – Falsified College Records

By: Stephanie Maniscalco | Missouri Lawyers Weekly  |  May 4, 2015

(1)Where former employees of a for-profit college claimed that the college fraudulently induced the Department of Education to provide funding by promising to keep accurate student records when the college admitted to the falsification of grade and attendance records, the judgment is reversed and remanded in part because the employees could proceed on a fraudulent inducement theory under the False Claims Act since the college’s policy and its agreement to comply with government regulations showed that it knew the importance of accurate records and the employees showed the pattern of altering records and the college’s intent to maximize funding, and the district court erred in ruling that the college’s record-keeping promise in the program participation agreement was not material to government disbursement decisions.

(2)Where two former employees of a for-profit college brought claims of retaliation and wrongful discharge against the college, the district court properly found that the defendant’s actions were not retaliatory, and a reasonable person would not have found that one employee’s working conditions were intolerable to support a claim of constructive discharge and the other employee did not show that the reported misconduct violated any law or clear public policy to support the claims for wrongful discharge, so summary judgment for the defendant is affirmed on the employment claims.

Judgment is reversed and remanded in part; affirmed in part.

U.S. ex rel. Miller v. Weston Educational, Inc. (MLW No. 67738/Case No. 14-1750 – 20 pages) (U.S. Court of Appeals, 8 th Circuit, Benton, J.) Appealed from U.S. District Court, Western District of Missouri, Laughrey, J. (Matthew V. Bartle, Kansas City, Missouri, argued for appellant; Gene P. Graham Jr., David Louis Marcus and Bryan T. White appeared on the brief) (Steven Martin Gombos, Fairfax, Virginia, argued for appellee; Matthew T. Geiger appeared on the brief).

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