Lance Armstrong Fails in Court

Lance Armstrong

The motion by attorneys for disgraced cyclist Lance Armstrong to dismiss a $100 million fraud lawsuit brought against him by the U.S. government, failed in federal court to convince Judge Robert Wilkins of its merits. The government’s case against the former Tour de France champion is on behalf of his former sponsor, the U.S. Postal Service.  Lawyers for the plaintiff are seeking damages under the False Claims Act alleging that if it had known Armstrong’s team was cheating and was in violation of its sponsorship contract, it would not have paid $40 million in sponsor fees between 1998 and 2004.

One argument for dismissal being made by defense attorneys is the age of the case, stemming from events of more than nine years past. They are claiming it is too old and the statute of limitations should prohibit the case from moving forward. Additionally, his attorneys contend that the government did nothing to stop the suspected doping, saying it should have known about it, and choosing instead to continue reaping the benefits of all the positive publicity generated by Armstrong’s Tour de France victories.

In support of the defense’s argument, according to Judge Wilkins, the government held documents that possibly suggest it had reason to know the cycling team was cheating, in spite of the results of an investigation conducted by French authorities that failed to uncover the transgressions. Wilkins opined further that if the government did suspect Armstrong and other team members were running afoul of the rules, there may be merit to the defendants’ assertion that a government investigation should have been conducted sooner, and that such an investigation would have uncovered the doping. However, according to Judge Wilkins, the Court is not permitted to make that determination based solely on the information in the complaint, and so the motion to dismiss the government’s action, as time-barred, was denied.

One of the chief witnesses in the case against Armstrong is former teammate Floyd Landis, an admitted steroid user turned whistleblower. Landis filed suit against Armstrong, also under the False Claims Act, which in his case gives a financial incentive to citizens to file suit on behalf of the United States against individuals whom they know are defrauding, or have defrauded the government. If Armstrong’s attorneys fail to convince the court, and the government prevails, Landis is eligible to collect 25 percent of the damages.

In a separate, but related development, Armstrong was dealt another legal blow in his fight to keep from giving sworn testimony under oath in a lawsuit filed by SCA Promotions, a Dallas sports insurance company. The company is seeking more than $12 million in damages for monies it paid Armstrong after he won the Tour de France in 2002 through 2004. The cyclist’s petition for a Texas Appeals Court and the Texas Supreme Court to stop the company from conducting a sworn videotaped deposition was rejected by both courts, and Armstrong was compelled to give his testimony.

USA Today reports that the 81 page ruling by Judge Wilkins denying the request for a dismissal means the government is cleared to proceed. This could signal a long, tedious, and expensive legal battle between the former cyclist and the government. In the event that his defense team fails to persuade the court and the government wins its case, Armstrong stands to lose a fortune.

By Mark Politi

Sources:
USA Today
Forbes
USA Today 2

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