POGO’S Day In Court: No Good Deed Goes Unpunished

Yesterday, a federal jury ruled against POGO in the Department of Justice’s (DOJ) civil case that alleged we had unlawfully supplemented a government employee’s salary. This case began a decade ago when POGO shared with two government whistleblowers our lawsuit recovery after suing the fifteen biggest oil companies. We shared the lawsuit proceeds as a public service award for the whistleblowers’ long-standing efforts to expose the oil industry’s ripping off the taxpayer when drilling on public land. The DOJ’s case was based on philosophical disagreement between it and POGO about whether organizations like ours can have whistleblowers act as shadow relators in litigation to fight government fraud.

In case you aren’t familiar with the history of the case: In June 1997, POGO and others filed a qui tam False Claims Act lawsuit against the biggest oil companies. POGO asked two government whistleblowers to join the lawsuit (the law allows government employees to do so). Fearing retaliation, the whistleblowers declined. The Department of Justice (DOJ) ultimately intervened in the qui tam suit against fifteen of the companies. In August 1998, the Mobil Oil Company settled the False Claims litigation for $45 million of which POGO received $1.2 million. POGO and its Board of Directors shared the settlement with the two whistleblowers for their courage in trying to hold Big Oil accountable for defrauding American taxpayers. Ironically, during the trial, DOJ accused POGO of keeping our sharing with the whistleblowers a secret. In fact at the time, DOJ asked POGO not to hold a press conference and indicated no concern with our sharing with the whistleblowers. We complied with their request and canceled our media plans.

Ultimately, the federal government recovered nearly $440 million in settlements against the major oil companies and the Department of Interior was forced to more seriously collect oil royalties.

The oil industry and its allies in Congress struck back, harassing POGO with invasive subpoenas, then attempting to hold POGO in contempt of Congress. Congress then pressured DOJ to investigate and the result was DOJ charging POGO with supplementing the income of one of the whistleblowers. POGO continues to believe that we did the right thing in sharing the settlement, and certainly did not violate the law. We believe DOJ mischaracterized the facts and misinterpreted the law.

In addition, the jury was not allowed to consider the fact that POGO had notified the Justice Department of our intentions before we presented a share of the lawsuit recovery as a public service award; nor the fact that oil industry-funded Members of Congress wrote to DOJ demanding an investigation of POGO; nor was POGO allowed to explain our intent in sharing with the whistleblowers. POGO plans on presenting additional arguments to the Court related to assessment of civil damages and we are considering an appeal.

The Project On Government Oversight will continue to investigate and expose waste and fraud and demand greater accountability in the federal government. At the same time, we will continue to work diligently with Congress and others to strengthen protections for whistleblowers who face harsh retaliation but whose commitment and dedication to best practices is so essential to achieving good governance.