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October 9, 2017

09 October 2017

Fifth Circuit Reverses $663M Jury Verdict Based on Government’s Insistence That It Was Not Defrauded

If the government “repeatedly concludes that it has not been defrauded,” could fraud have nonetheless occurred?  The Fifth Circuit grappled with this question when reviewing an appeal from a $663 million jury verdict against Trinity Industries, a manufacturer of highway guardrails.  See United States ex rel. Harman v. Trinity Indus., No. 15-41172 (5th Cir. Sept. 29, 2017).  In finding the relator’s allegations of materiality wanting, the Fifth Circuit’s grant of judgment as a matter of law for Trinity Industries reiterated that the Supreme Court’s Escobar decision “heightened” the materiality standard to “adjust tensions between singular private interests and those of government and cabin the greed that fuels” False Claims Act litigation.

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