Amicus Brief Filed In U.S. Supreme Court To Support Reversal Of Decision Holding That Any Government Contract Tainted By Fraud Is Void From The Outset
On April 30, 2008, the National Defense Industrial Association -- a trade association whose membership includes 1300 defense contractors, many of whom are small businesses -- filed an amicus curiae brief in support of a petition for a writ of certiorari at the U.S. Supreme Court. The amicus brief encouraged the Supreme Court to reverse a September 2007 decision by the U.S. Court of Appeals for the Federal Circuit vacating a $436 million verdict in favor of a victim thrift in a Winstar-related case because the thrift's agreement with the government was tainted from the inception by fraud and misrepresentation. Long Island Savings Bank, FSB v. United States, 503 F.3d 1234. The Federal Circuit held that any agreement with the federal government that is tainted by fraud or misrepresentation or conflict of interest at the outset -- even when the wrongful acts were committed by a rogue employee engaged in illegal acts of self-dealing -- automatically renders the agreement void in its entirety and absolves the government from any responsibility to perform (even though the contractor may have already fully performed under the agreement, and the government may have already received the benefit of the bargain).
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