THE UNITED STATES DEPARTMENT OF TRANSPORTATION, ex rel. AUGUST W. ARNOLD, Plaintiff,
CMC ENGINEERING, INC., Defendant.
MEMORANDUM AND ORDER
CATHY BISSOON, District Judge.
This is a qui tam action under the False Claims Act ("FCA"), 31 U.S.C. §3729(a)(1)(A)-(B). August W. Arnold brings this action on behalf of the U.S. Department of Transportation, alleging that CMC Engineering misrepresented the credentials of its consultants to obtain higher pay rates for work performed on state projects that were paid for with federal funds. [Doc. No. 210] Arnold seeks an injunction preventing CMC from further violating the FCA, as well as damages and penalties. CMC has filed a Motion for Summary Judgment [Doc. No. 415], which, for the reasons stated herein, will be granted.
The Pennsylvania Department of Transportation is charged with constructing, maintaining and repairing the Commonwealth's major roadways. PennDOT regularly receives funds from the Federal Highway Administration ("FHWA") to pay for its highway projects, which it then disburses to private contractors hired to complete the work. Federal monies often comprise 80 percent of the funding for PennDOT's projects.
PennDOT routinely hires private engineering firms to provide inspection services on its construction projects. In turn, these private firms independently contract with individual engineering inspectors, whose credentials the firms submit to PennDOT when they bid on the work. All private inspectors who perform work for PennDOT must possess certain minimum professional qualifications. These qualifications are established by PennDOT and are sorted into a hierarchy of "inspector classification levels" based on various combinations of educational and skills credentials, certifications and experience. The more qualifications an inspector possesses, the higher the inspector's classification level, and, thus, the higher the hourly rate of pay the firm may bill PennDOT for the inspector's services.
The inspector classification levels are made known to interested firms during the bidding process and are described in PennDOT's contracts. In ascending order, the classification levels are: Technical Assistant; Technical Assistant-1; Transportation Construction Inspector; Transportation Construction Inspector-Materials; Transportation Construction Inspector Supervisor; Transportation Construction Manager-1; and Transportation Construction Manager-2. An inspector cannot work on a PennDOT project without PennDOT's prior approval. Because the number of construction inspectors is small and competition for their services is intense, PennDOT is familiar with many of them, and, on at least one occasion, it instructed that a particular inspector be classified at a higher level than her qualifications justified because it wanted to secure her services.
A. Inspector Qualifications
From 1994 until 2003, PennDOT incorporated into all of its engineering contracts a standard form outlining the staffing requirements that inspection personnel were required to meet. During the relevant timeframe, this form was the only guidance that PennDOT provided to the consultant firms regarding inspector qualifications.
For the seven inspector classification levels referenced above, the form required either certification under "NICET" and a certain number of years of work experience, or educational training and a certain number of years of work experience. The form also established for each contract: (1) a "Scope of Work, " indicating the number of inspectors required to possess certain minimum qualifications, as specified by PennDOT and the consultant firm; and (2) a document entitled "Attachment A, " which described in more detail the combination of certifications, educational background and field experience that the consultant's entire staff of inspectors was required to possess at each level.
The Scope of Work section required that the inspection staff "meet the requirements shown in the Tables A, B, and C, " and to "meet the minimum NICET Certification or State Equivalency requirements for the appropriate Department Inspection Classification, " also indicated in "Tables B and C."
Table A listed the minimum number of inspectors, based on the total number of inspectors working on a project, who were required to possess at least one of five possible combinations of education and experience. The levels of experience required by four of these five combinations were not specifically identified. Rather, PennDOT had the discretion to deem an inspector's experience "acceptable" so long as the inspector possessed the requisite educational background or certification. Tables B and C provided more specific guidance regarding the combinations of professional certifications, educational background and field experience required for each of the seven classification levels. According to the Tables, an inspector could satisfy the requirements of any given classification level by possessing either of the following: (1) the specified NICET certification and years of field experience as provided in Table B; or (2) a combination of education and experience that would be "equivalent" to the NICET certification and years' experience ("NICET-equivalent") as provided in Table C.
The Scope of Work's "Section B" stated:
The Engineer shall make a detailed background check on all potential staffing candidates and then submit their proposed wage rate and resumes in sufficient detail to assure the Department that the individual meets and/or exceeds the requirements for the Departments Inspection Classification for which the individual is being considered. Individuals are not considered approved for this agreement just because their names and rates are included in the Engineer's proposal. The job ...