United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
October 20, 2004
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
______________________ Clerk
No. 03-20460
______________________
UNITED STATES OF AMERICA, ex rel. Dan GRAVES and Susan Newman
Plaintiffs-Appellants
versus
ITT EDUCATIONAL SERVICES, INC., PRICE WATERHOUSE, COOPERS LLP,
and Rene R. Champagne,
Defendant-Appellees
___________________________________________________
Appeals from the United States District Court for
the Southern District of Texas
(Civ. A. H-99-3889)
____________________________________________________
Before DeMOSS, DENNIS, and CLEMENT, Circuit Judges.
PER CURIAM:*
In this False Claims Act case Relators Dan Graves and Susan
Newman sued ITT Educational Services, Inc. and its Chairman Rene R.
Champagne (together “ITT”) along with its auditor Pricewaterhouse
Coopers, LLP, alleging violations of the False Claims Act, 31
U.S.C. §3729, et seq. ITT participated in federal student
financial aid programs under Title IV of the Higher Education Act
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
1
of 1995, 20 U.S.C. §1078, et seq. Under these programs the United
States Government insured educational loans and made direct
educational grants to students enrolled at ITT. Title IV, Part G,
§487(a)(20) of the HEA prohibits participating educational
institutions such as ITT from making commission or incentive
payments to admissions or recruitment personnel based on success in
securing enrollments or financial aid to students. Relators
contend that ITT and Champagne falsely promised to comply with the
statute and falsely certified that ITT would comply with it.
Relators also allege that Pricewaterhouse Cooopers, in its audits
of ITT, made false statements as to ITT’s attestations of
compliance and as to whether ITT’s financial statements fairly
represented its financial condition.
ITT moved to dismiss Relators’ complaint under Rule 12(b)(b)
and Pricewaterhouse Coopers moved to dismiss under Rules 12(b)(6)
and 9(b). Based on the factual allegations in Relators’ complaint
and the facts presented in Relators’ exhibits, the district court
granted Defendants’ motions to dismiss with prejudice. Having
reviewed the record and fully considered the parties’ briefs and
oral arguments, we find no reversible error in the district court’s
judgment. We therefore AFFIRM the district court’s judgment,
United States ex rel. Graves v. ITT Educational Services, Inc., 284
2
F. Supp. 2d 487 (S.D. Tex. 2003), essentially for the reasons
stated in its memorandum opinion and order.2
2
For clarification purposes, we note shortly after the
district court issued its opinion, a panel of this Court in U.S.
ex rel. Willard v. Humana Health Plan, 336 F.3d 375 (5th Cir.
2003), stated: “While this Circuit has decided cases dealing with
FCA liability based on express certifications of compliance with
various statutes and regulations, we have not specifically
addressed whether FCA liability can be based on an ‘implied
certification’ theory.” Id. at 381. Therefore, we must excise
from an essential approval of the district court’s reasons its
statement that we have adopted an implied certification theory.
284 F.Supp. 2d at 497. Notwithstanding that statement, the
district court reached the correct result.
3