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UNITED STATES v. FLIEGLER

October 29, 1990

UNITED STATES OF AMERICA, PLAINTIFF,
v.
MICHEL J. FLIEGLER AND DONALD L. NEWMAN, DEFENDANTS.



The opinion of the court was delivered by: Spatt, District Judge.

MEMORANDUM AND ORDER

The issue in this action is whether the Double Jeopardy Clause of the Fifth Amendment to the United States Constitution (see U.S. Const., Amdt. V ["nor shall any person be subject for the same offense to be twice put in jeopardy of life or limb"]) precludes the Court from entering partial summary judgment in favor of plaintiff United States of America (the "Government"). Since the Court finds that the granting of partial summary judgment would not violate the Double Jeopardy Clause, the Government's motion is granted.

I.  THE CIVIL ACTION

From September 1974 through December 1984 the defendants and their spouses were the sole shareholders and officers of Arista Devices Corporation ("Arista"), a defense contractor which produced various electronic and electromagnetic devises for the Government. On March 15, 1988 the Government filed a Complaint and on April 13, 1988 an Amended Complaint in which it alleged that Arista submitted fraudulent statements to the Government in regard to six Arista contracts and three Arista subcontracts. The six contracts and three subcontracts described in the Amended Complaint were as follows:

  * Contract F09603-80-C-4665 for the production of
  34 "Brush Block Assemblies" used in military
  aircraft radar, total payments made of $22,186.70;
  * Contract DAAE07-83-C-W640 for the production of
  476 "Laser Modification Kits" used in M60-A3
  tanks, total payments made of $1,752,361.17;
  * Contract N00383-80-C-3590 for the production of
  1,656 "Firing Cap Assemblies" used in ejector bomb
  racks of A-4 Skyhawk Bombers, total payments made
  of $185,460.22;
  * Contracts F09603-82-D-04493 and F09603-83-C-3736
  for the production of "Elevation Data Generators"
  installed in the infra-red tail warning systems of
  F-111 airplanes, total payments of $8,079.75 and
  $28,802.81 respectively;
  * Subcontract Purchase Orders 1059-28949,
  1095-30167, and 1168-34890 for "Terminal Boards"
  used in the turret of M60-A3 battle tanks, total
  payments made of $885,472.88; and
  * Contract N00383-80-C-4056 for the production of
  "Magnetic Amplifiers" for A-4 Skyhawk aircraft
  computers, total payments made of $24,942.53.

The Amended Complaint alleged seven claims for relief: (1) breach of contract; (2) knowing and intentional participation in breach of contract and aiding and abetting breach of contract; (3) defraud of the Government; (4) fraudulent inducement; (5) submitting false claims to the Government in violation of 31 U.S.C. § 3729 et seq.; (6) conspiracy to violate 31 U.S.C. § 3729 et seq.; and (7) obtaining monies from the Government. The Government sought $2,907,306.06 in damages on its First, Second, Third, Fourth and Seventh Claims for Relief, and $9,291,918.18 in damages on its Fifth and Sixth Claims for Relief — $8,721,918.18 treble damages ($2,907,306.06 X 3) plus $570,000 statutory damages pursuant to 31 U.S.C. § 3729(a), which provides for a penalty of between $5,000 and $10,000 for each of the 57 false claims allegedly submitted to the Government.

II.  THE INDICTMENT

On April 14, 1988 the defendants were indicted in the Eastern District of New York (CR 88-220 [RR]). The Indictment alleged criminality with respect to some, but not all of the contracts described in the Amended Complaint.

A.  The Laser Modification Kits

Count One of the Indictment alleged that the defendants conspired to defraud the Government by obtaining payments and submitting fraudulent claims for Arista's production of Laser and Computer Installation Modification Kits ("Laser Modification Kits") to upgrade the sighting and firing capability of the M60-A3 tank. Counts Two and Three of the Indictment charged the defendants with making false writings for the purpose of obtaining money from the Government in connection with Arista's contract to produce Laser Modification Kits, and Counts Four through Twenty Six of the Indictment alleged that the defendants submitted particular fraudulent claims from January 1984 through February 1985 in connection with the Laser Modification Kits.

B.  The Terminal Boards

Count Twenty Seven of the Indictment alleged that the defendants conspired to defraud the Government by obtaining payments and submitting fraudulent claims for Arista's production of Terminal Boards for the M60-A3 tank, in particular Purchase Orders # 1059-28949, # 1095-30167, and # 1168-34890 (including three amendments thereto). Counts Twenty Eight and Twenty Nine of the Indictment alleged that the defendants devised a scheme to defraud the general contractor for whom Arista subcontracted to build the Terminal Boards, and Counts Thirty and Thirty One alleged that the defendants mailed certain matter in furtherance of the scheme alleged in Counts Twenty Eight and Twenty Nine.

C.  The Wiring Harness Brush Block Assemblies

Count Thirty Two of the Indictment alleged that the defendants conspired to defraud the Government by obtaining payment and submitting fraudulent claims in connection with Arista's production of Wiring Harness Brush Block Assemblies ("Block Assemblies") for the radar system used on C-130 and E3A Sentry aircraft. Counts Thirty Five through Forty of the Indictment alleged that the defendants presented particular false claims to the Government in connection with Arista's production of the Block Assemblies.

D.  The Generator Modules

Finally, Count Forty One of the Indictment alleged that the defendants conspired to defraud the Government by obtaining payment and submitting fraudulent claims for Arista's production of Elevation Data Generator Modules ("Generator Modules") used in the tail warning systems of the FB-111 fighter bomber, and Counts Forty Two through Forty Seven of the Indictment alleged that the defendants presented ...


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