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Feds Mull Joining Qui Tam Case Against Former Pro-Cyclist Lance Armstrong

According to the Wall Street Journal, officials at the U.S. Department of Justice have recommended that the federal government join a False Claims Act case reportedly filed in 2010 by Lance Armstrong’s former teammate Floyd Landis. All federal whistleblower suits are kept under seal, but an individual who has reportedly seen the lawsuit confirmed its existence and substance to several news agencies including WSJ, Fox News, CBS and USA Today.

A federal official told USA Today that the deadline for the Justice Department to join the suit is today. Co-incidentally, it is the same day that Armstrong’s “tell-all” interview with Oprah Winfrey is scheduled to air.

The WSJ reports that the whistleblower suit alleges that Armstrong and his co-defendants, including his longtime team director Johan Bruyneel, defrauded the U.S. Postal Service out of $30.6 million when the USPS sponsored Armstrong’s racing team. Landis filed the whistleblower suit under the qui tam provisions of the False Claims Act.

According to the WSJ, the contract with the USPS required that Armstrong and his team refrain from “possession, use or sale of banned substances [i.e., performance enhancing drugs].” Landis’s suit allegedly claims that Armstrong violated the False Claims Act by using performance enhancing drugs in violation of the contract with USPS. If Armstrong is found guilty of violating the False Claims Act, he could be liable for treble damages – nearly $100 million. CBS reported that Armstrong offered $5 million to settle the matter, but the Justice Department denied the offer.

Under the qui tam provisions of the False Claims Act, the whistleblower may be entitled to a percentage of any recovery by the government.