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Lance Armstrong Agrees to Pay $5 Million to Settle False Claims Act Case Brought by Qui Tam Whistleblower

Lance Armstrong, the cyclist who became a national hero wearing a yellow jersey emblazoned with the iconic blue and white eagle of the U.S. Postal Service, has agreed to pay $5 million to settle allegations that payments under that sponsorship agreement were, like so much else in his career, the result of fraud. On April 19, 2018, the U.S. Department of Justice announced that it had reached an agreement to resolve perhaps the most high-profile false claims act lawsuit in history involving allegations of U.S. Postal Service fraud. As summed up by a representative of the Department of Justice, “a competitor who intentionally uses illegal PEDs not only deceives fellow competitors and fans, but also sponsors, who help make sporting competitions possible.”

The lawsuit against Armstrong has been a long road for Floyd Landis, a former Armstrong teammate who himself has admitted to doping during competitions. In June 2010, long before Armstrong was stripped of his titles in 2012 after an investigation by the U.S. Anti-Doping Agency, Landis, with the help of false claims act attorneys, filed a complaint in federal court against Armstrong. Mr. Landis alleged that, in 2002, Armstrong personally gave him performance-boosting testosterone patches and that he and Armstrong lay side-by-side in a hotel room while they both received performance-enhancing blood transfusions in preparation for the 2002 Tour de France (which Armstrong went on to win). These and other actions, Landis and his attorneys claimed, violated an anti-doping clause in the Postal Service’s $32.3 million sponsorship deal with Armstrong’s cycling team, meaning that claims for payment under that contract were fraudulent and subject to false claims act sanctions.

Around the time that Landis filed his complaint, Armstrong’s camp attacked Landis as a “bitter and scorned” man with “zero credibility” making “baseless threats” based on “incredible concoctions.” Mr. Landis stood alone as plaintiff in the case until, in January 2013, Armstrong finally admitted to using performance enhancing substances during his cycling career. After that admission, the Department of Justice intervened to take over the prosecution of the case that Mr. Landis had kicked off over two-and-a-half years before. Mr. Landis described the case, in a statement released by his qui tam lawyers, as “a difficult ordeal,” noting that “public opinion was not always on [his] side.” Despite that, he remains convinced that “it was the right thing to do,” and hopes his revelations will result in “positive changes for cycling and sport in general.” For his efforts, Mr. Landis will receive $1.1 million under a provision of the false claims act that permits qui tam whistleblowers to share in any money recovered by the U.S. government. In addition, Armstrong will be required to pay $1.65 million to cover Landis’s legal costs.

“The U.S. Postal Service manages approximately 30,000 contract actions and spends more than $13 billion on contracted supplies and services each fiscal year,” according to a representative of the Postal Service Office of Inspector General. The scope for fraud by private companies in an operation as large and complex as this is massive, and whistleblowers and qui tam law firms are key to this fight. If you are aware of a company or individual that is engaging in a fraudulent practice, do not hesitate to take action. The law firm of Tycko & Zavareei LLP may be able to assist you in bringing your own qui tam lawsuit under the False Claims Act, acting as a whistleblower on behalf of the U.S. government. Successful qui tam whistleblowers can receive, as their reward, between 15% and 30% of the amount recovered for the government. If you would like to consult with one of our False Claims Act attorneys please fill out our Confidential Case Evaluation form, or call (202) 973-0900 to speak with a lawyer.