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SUPREME COURT OF THE UNITED STATES
_________________
No. 12–1497
_________________
KELLOGG BROWN & ROOT SERVICES, INC, et al,
PETITIONERS
v. UNITED STATES, ex rel.BENJAMIN
CARTER
on writ of certiorari to the united states
court of appeals for the fourth circuit
[May 26, 2015]
Justice Alito delivered the opinion of the
Court.
Wars have often provided “exceptional
opportunities” for fraud on the United States Government. See
United States v.
Smith, 342 U. S. 225, 228
(1952) . “The False Claims Act was adopted in 1863 and signed into
law by President Abraham Lincoln in order to combat rampant fraud
in Civil War defense contracts.” S. Rep. No. 99–345, p. 8 (1986).
Predecessors of the Wartime Suspension of Limitations Act were
enacted to address similar problems that arose during the First and
Second World Wars. See
Smith,
supra, at 228–229.
In this case, we must decide two questions
regarding those laws: first, whether the Wartime Suspension of
Limitations Act applies only to criminal charges or also to civil
claims; second, whether the False Claims Act’s first-to-file bar
keeps new claims out of court only while related claims are still
alive or whether it may bar those claims in perpetuity.
I
A
The False Claims Act (FCA) imposes liability
on any person who “knowingly presents . . . a false or
fraudulent claim for payment or approval,” 31 U. S. C.
§3729(a)(1)(A), “to an officer or employee of the United States,”
3729(b)(2)(A)(i). The FCA may be enforced not just through
litigation brought by the Government itself, but also through civil
qui tam actions that are filed by private parties, called
relators, “in the name of the Government.” §3730(b).
In a
qui tam suit under the FCA, the
relator files a complaint under seal and serves the United States
with a copy of the complaint and a disclosure of all material
evidence. §3730(b)(2). After reviewing these materials, the United
States may “proceed with the action, in which case the action shall
be conducted by the Government,” or it may “notify the court that
it declines to take over the action, in which case the person
bringing the action shall have the right to conduct the action.”
§3730(b)(4). Regardless of the option that the United States
selects, it retains the right at any time to dismiss the action
entirely, §3730(c)(2)(A), or to settle the case,
§3730(c)(2)(B).
The FCA imposes two restrictions on
qui tam suits that are relevant here. One, the
“first-to-file” bar, precludes a
qui tam suit “based on the
facts underlying [a] pending action.” §3730(b)(5) (emphasis added).
The other, the FCA’s statute of limitations provision, states that
a
qui tam action must be brought within six years of a
violation or within three years of the date by which the United
States should have known about a violation. In no circumstances,
however, may a suit be brought more than 10 years after the date of
a violation. §3731(b).
B
The Wartime Suspension of Limitations Act
(WSLA) suspends the statute of limitations for “any offense”
involving fraud against the Federal Government. 18
U. S. C. §3287. Before 2008, this provision was activated
only “[w]hen the United States [was] at war.”
Ibid. (2006
ed.). In 2008, however, this provision was made to apply as well
whenever Congress has enacted “a specific authorization for the use
of the Armed Forces, as described in section 5(b) of the War Powers
Resolution (50 U.S.C. 1544(b)).”
Ibid. (2012 ed.).
II
Petitioners are defense contractors and
related entities that provided logistical services to the United
States military during the armed conflict in Iraq. From January to
April 2005, respondent worked in Iraq for one of the petitioners as
a water purification operator. He subsequently filed a
qui tam complaint against petitioners (
Carter
I), alleging that they had fraudulently billed the Government
for water purification services that were not performed or not
performed properly. The Government declined to intervene.
In 2010, shortly before trial, the Government
informed the parties about an earlier filed
qui tam
lawsuit,
United States ex rel. Thorpe v.
Halliburton
Co., No. 05–cv–08924 (CD Cal., filed Dec. 23, 2005), that
arguably contained similar claims. This initiated a remarkable
sequence of dismissals and filings.
The District Court held that respondent’s suit
was related to
Thorpe and thus dismissed his case without
prejudice under the first-to-file bar. Respondent appealed, and
while his appeal was pending,
Thorpe was dismissed for
failure to prosecute. Respondent quickly filed a new complaint
(
Carter II), but the District Court dismissed this second
complaint under the first-to-file rule because respondent’s own
earlier case was still pending on appeal. Respondent then
voluntarily dismissed this appeal, and in June 2011, more than six
years after the alleged fraud, he filed yet another complaint
(
Carter III ), and it is this complaint that is now at
issue.
Petitioners sought dismissal of this third
complaint under the first-to-file rule, pointing to two allegedly
related cases, one in Maryland and one in Texas, that had been
filed in the interim between the filing of
Carter I and
Carter III. This time, the court dismissed respondent’s
complaint with prejudice. The court held that the latest complaint
was barred under the first-to-file rule because the Maryland suit
was already pending when that complaint was filed. The court also
ruled that the WSLA applies only to criminal charges and thus did
not suspend the time for filing respondent’s civil claims. As a
result, the court concluded, all but one of those claims were
untimely because they were filed more than six years after the
alleged wrongdoing.
The Fourth Circuit reversed, rejecting the
District Court’s analysis of both the WSLA and first-to-file
issues.
United States ex rel. Carter v.
Halliburton
Co., 710 F. 3d 171 (2013). Concluding that the WSLA
applies to civil claims based on fraud committed during the
conflict in Iraq,[
1] the Court
of Appeals held that respondent’s claims had been filed on time.
The Court of Appeals also held that the first-to-file bar ceases to
apply once a related action is dismissed. Since the Maryland and
Texas cases had been dismissed by the time of the Fourth Circuit’s
decision, the court held that respondent had the right to refile
his case. The Court of Appeals thus remanded
Carter III with
instructions to dismiss without prejudice.
After this was done, respondent filed
Carter
IV, but the District Court dismissed
Carter IV on the
ground that the petition for a writ of certiorari in
Carter
III (the case now before us) was still pending.
We granted that petition, 573 U. S. ___
(2014), and we now reverse in part and affirm in part.
III
The text, structure, and history of the WSLA
show that the Act applies only to criminal offenses.
A
The WSLA’s roots extend back to the time after
the end of World War I. Concerned about war-related frauds,
Congress in 1921 enacted a statute that extended the statute of
limitations for such offenses. The new law provided as follows:
“[I]n offenses involving the defrauding or attempts to defraud the
United States or any agency thereof . . . and
now
indictable under any existing statutes, the period of
limitations shall be six years.” Act ofNov. 17, 1921, ch. 124,
42Stat. 220 (emphasis added). Since only crimes are “indictable,”
this provision quite clearly was limited to the filing of criminal
charges.
In 1942, after the United States entered World
War II, Congress enacted a similar suspension statute. This law,
like its predecessor, applied to fraud “offenses . . .
now indictable under any existing statutes,” but this time the law
suspended “any” “existing statute of limitations” until the fixed
date of June 30, 1945. Act of Aug. 24, 1942, ch. 555, 56Stat.
747–748.
As that date approached, Congress decided to
adopt a suspension statute which would remain in force for the
duration of the war. Congress amended the 1942 WSLA in three
important ways. First, Congress deleted the phrase “now indictable
under any statute,” so that the WSLA was made to apply simply to
“any offense against the laws of the United States.” 58Stat. 667.
Second, although previous versions of the WSLA were of definite
duration, Congress now suspended the limitations period for the
open-ended timeframe of “three years after the termination of
hostilities in the present war as proclaimed by the President or by
a concurrent resolution of the two Houses of Congress.”
Ibid. Third, Congress expanded the statute’s coverage beyond
offenses “involving defrauding or attempts to defraud the United
States” to include other offenses pertaining to Government
contracts and the handling and disposal of Government property.
Ibid., and §28, 58Stat. 781.
Congress made more changes in 1948. From then
until 2008, the WSLA’s relevant language was as follows:
“When the United States is at war the
running of any statute of limitations applicable to any offense (1)
involving fraud or attempted fraud against the United States or any
agency thereof in any manner, whether by conspiracy or not
. . . shall be suspended until three years after the
termination of hostilities as proclaimed by the President or by a
concurrent resolution of Congress.” Act of June 25, 1948, §3287,
62Stat. 828.
In addition, Congress codified the WSLA in Title
18 ofthe United States Code, titled “Crimes and Criminal
Procedure.”
Finally, in 2008, Congress once again amended
the WSLA, this time in two relevant ways. First, as noted, Congress
changed the Act’s triggering event, providing that tolling is
available not only “[w]hen the United States is at war,” but also
when Congress has enacted a specific authorization for the use of
military force. Second, Congress extended the suspension period
from three to five years. §855, 122Stat. 4545
.[
2]
B
With this background in mind, we turn to the
question whether the WSLA applies to civil claims as well as
criminal charges. We hold that the Act applies only to the
latter.
We begin with the WSLA’s text. The WSLA suspends
“the running of any statute of limitations applicable to any
offense . . . involving fraud or attempted fraud
against the United States or any agency thereof.” 18
U. S. C. §3287 (emphasis added). The term “offense” is
most commonly used to refer to crimes. At the time of both the 1948
and 2008 amendments to the Act, the primary definition of “offense”
in Black’s Law Dictionary referred to crime. Black’s Law Dictionary
1110 (8th ed. 2004) (Black’s) (“A violation of the law; a crime,
often a minor one. See crime”);
id., at 1232 (4th ed. 1951)
(“A crime or misdemeanor; a breach of the criminal laws”);
id., at 1282 (3d ed. 1933) (same). The 1942 edition of
Webster’s similarly states that “offense” “has no technical legal
meaning; but it is sometimes used specifically for an indictable
crime . . . and sometimes for a misdemeanor or wrong
punishable only by fine or penalty.” Webster’s New International
Dictionary 1690 (2d ed.). See also Webster’s Third New
International Dictionary 1566 (1976) (Webster’s Third) (“an
infraction of law: crime, misdemeanor”); American Heritage
Dictionary 1255 (3d ed. 1992) (“A transgression of law; a
crime”).
It is true that the term “offense” is sometimes
used more broadly. For instance, the 1948 edition of Ballentine’s
Law Dictionary cautions: “The words ‘crime’ and ‘offense’ are not
necessarily synonymous. All crimes are offenses, but some offenses
are not crimes.” Ballentine’s Law Dictionary 900.
But while the term “offense” is sometimes used
in this way, that is not how the word is used in Title 18.
Al-though the term appears hundreds of times in Title 18, neither
respondent nor the Solicitor General, appearing as an
amicus
in support of respondent, has been able to find a single provision
of that title in which “offense” is employed to denote a civil
violation. The Solicitor General cites eight provisions,[
3] but not one actually labels a civil
wrong as an “offense.” Instead, they all simply attach civil
penalties to criminal offenses—as the Deputy Solicitor General
acknowledged at oral argument. See Tr. of Oral Arg. 28–29.
Not only is this pattern of usage telling, but
when Title 18 was enacted in 1948, the very first provision, what
was then 18 U.S.C. §1, classified all offenses as crimes. That
provision read in pertinent part as follows:
Ҥ1. Offenses classified.
“Notwithstanding any Act of Congress to
thecontrary:
“(1) Any offense punishable by death or
imprisonment for a term exceeding one year is a felony.
“(2) Any other offense is a misdemeanor.”
62Stat. 684 (repealed Oct. 12, 1984).
The Solicitor General correctly points out that
regulatory provisions outside Title 18 sometimes use the term
“offense” to describe a civil violation, see Brief for United
States as
Amicus Curiae 10 (United States Brief), but it is
significant that Congress chose to place the WSLA in Title 18.
Although we have cautioned against “plac[ing] too much significance
on the location of a statute in the United States Code,”
Jones v.
R. R. Donnelley & Sons Co., 541
U. S. 369, 376 (2004) , we have in similar circumstances
regarded the placement of a provision as relevant in determining
whether its content is civil or criminal in nature, see
Kansas v.
Hendricks, 521 U. S. 346, 361 (1997) .
It is also revealing that Congress has used clearer and more
specific language when it has wanted to toll the statutes of
limitations for civil suits as well as crimes. Only two months
after enacting the WSLA, Congress passed a tolling statute for
“violations of the antitrust laws . . . now indictable
or subject to civil proceedings.” Act of Oct. 10, 1942, ch.
589, 56Stat. 781 (emphasisadded). Congress obviously could have
included a similar “civil proceedings” clause in the WSLA, but it
did notdo so.
The WSLA’s history provides what is perhaps the
strongest support for the conclusion that it applies only to
criminal charges. The parties do not dispute that the term
“offenses” in the 1921 and 1942 suspension statutes applied only to
crimes, Brief for Petitioners 23; Brief for Respondent at 24–25,
and after 1942, the WSLA continued to use that same term. The
retention of the same term in the later laws suggests that no
fundamental alteration was intended.
Respondent and the Government latch onto the
1944 Act’s removal of the phrase “now indictable under any statute”
and argue that this deletion had the effect of sweeping in civil
claims, but this argument is most improbable. Simply deleting the
phrase “now indictable under the statute,” while leaving the
operative term “offense” unchanged would have been an obscure way
of substantially expanding the WSLA’s reach. Fundamental changes in
the scope of a statute are not typically accomplished with so
subtle a move. Converting the WSLA from a provision that suspended
the statute of limitations for criminal prosecutions into one that
also suspended the time for commencing a civil action would have
been a big step. If Congress had meant to make such a change, we
would expect it to have used language that made this important
modification clear to litigants and courts.
Respondent’s and the Government’s interpretation
of the significance of the deletion of the phrase “now indict-able”
ignores a more plausible explanation, namely, Congress’ decision to
make the WSLA applicable, not just to offenses committed in the
past during or in the aftermath of particular wars, but also to
future offenses committed during future wars. When the phrase “now
indictable” first appeared in the 1921 Act, it meant that the
statute of limitations was suspended for only those crimes that had
already been committed when the Act took effect. This made sense
because the 1921 Act was a temporary measure enacted to deal with
problems resulting from the First World War. The 1942 Act simply
“readopt[ed] the [same] World War I policy” to deal with claims
during World War II.
Bridges v.
United States, 346
U. S. 209, 219 (1953) .
The 1944 amendments, however, changed the WSLA
from a retroactive measure designed to deal exclusively with past
fraud into a measure applicable to future fraud as well. In order
to complete this transformation, it was necessary to remove the
phrase “now indictable,” which, as noted, limited the applicability
of the suspension to offenses committed in the past. Thus, the
removal of the “now indictable” provision was more plausibly driven
by Congress’ intent to apply the WSLA prospectively, not by any
desire to expand the WSLA’s reach to civil suits. For all these
reasons, we think it clear that the term “offense” in the WSLA
applies solely to crimes.
But even if there were some ambiguity in the
WSLA’s use of that term, our cases instruct us to resolve that
ambiguity in favor of the narrower definition. We have said that
the WSLA should be “narrowly construed” and “ ‘interpreted in
favor of repose.’ ”
Id., at 216 (quoting
United
States v.
Scharton, 285 U. S. 518 –522 (1932).
Applying that principle here means that the term “offense” must be
construed to refer only to crimes. Because this case involves civil
claims, the WSLA does not suspend the applicable statute of
limitations under either the 1948 or the 2008 version of the
statute.[
4]
IV
Petitioners acknowledge that respondent has
raised other arguments that, if successful, could render at least
one claim timely on remand. We therefore consider whether
respondent’s claims must be dismissed with prejudice under the
first-to-file rule. We conclude that dismissal with prejudice was
not called for.
The first-to-file bar provides that “[w]hen a
person brings an action . . . no person other than the
Government may intervene or bring a related action based on the
facts underlying the
pending action.” 31 U. S. C.
§3730(b)(5) (emphasis added). The term “pending” means “[r]emaining
undecided; awaiting decision.” Black’s 1314 (10th ed. 2014). See
also Webster’s Third 1669 (1976) (defining “pending” to mean “not
yet decided: in continuance: in suspense”). If the reference to a
“pending” action in the FCA is interpreted in this way, an earlier
suit bars a later suit while the earlier suit remains undecided but
ceases to bar that suit once it is dismissed. We see no reason not
to interpret the term “pending” in the FCA in accordance with its
ordinary meaning.
Petitioners argue that Congress used the term
“pending” in a very different—and very peculiar—way. In the FCA,
according to petitioners, the term “pending” “is ‘used as a
short-hand for the first filed action.’ ” Brief for
Petitioners 44. Thus, as petitioners see things, the first-filed
action remains “pending” even after it has been dismissed, and it
forever bars any subsequent related action.
This interpretation does not comport with any
known usage of the term “pending.” Under this interpretation,
Marbury v.
Madison, 1 Cranch 137 (1803), is still
“pending.” So is the trial of Socrates.
Petitioners say that Congress used the term
“pending” in the FCA as a sort of “short-hand,” but a shorthand
phrase or term is employed to provide a succinct way of expressing
a concept that would otherwise require a lengthy or complex
formulation. Here, we are told that “pending” is shorthand for
“first-filed,” a term that is neither lengthy nor complex. And if
Congress had wanted to adopt the rule that petitioners favor, the
task could have been accomplished in other equally economical
ways—for example, by replacing “pending,” with “earlier” or
“prior.”
Not only does petitioners’ argument push the
term “pending” far beyond the breaking point, but it wouldlead to
strange results that Congress is unlikely to have wanted. Under
petitioners’ interpretation, a first-filed suit would bar all
subsequent related suits even if that earlier suit was dismissed
for a reason having nothing to do with the merits. Here, for
example, the
Thorpe suit, which provided the ground for the
initial invocation of the first-to-file rule, was dismissed for
failure to prosecute. Why would Congress want the abandonment of an
earlier suit to bar a later potentially successful suit that might
result in a large recovery for the Government?
Petitioners contend that interpreting “pending”
to mean pending would produce practical problems, and there is some
merit to their arguments. In particular, as petitioners note, if
the first-to-file bar is lifted once the first-filed action ends,
defendants may be reluctant to settle such actions for the full
amount that they would accept if there were no prospect of
subsequent suits asserting the same claims. See Brief for
Petitioners at 56–57. Respondent and the United States argue that
the doctrine of claim preclusion may protect defendants if the
first-filed action is decided on the merits,
id., at 60–61;
United States Brief 30, but that issue is not before us in this
case. The False Claims Act’s
qui tam provisions present many
interpretive challenges, and it is beyond our ability in this case
to make them operate together smoothly like a finely tuned machine.
We hold that a
qui tam suit under the FCA ceases to be
“pending” once it is dismissed. We therefore agree with the Fourth
Circuit that the dismissal with prejudice of respondent’s one live
claim was error.
* * *
The judgment of the United States Court of
Appeals for the Fourth Circuit is reversed in part and affirmed in
part, and the case is remanded for further proceedings consistent
with this opinion.
It is so ordered.
