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THE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & LifestyleTHE BIZNOB – Global Business & Financial News – A Business Journal – Focus On Business Leaders, Technology – Enterpeneurship – Finance – Economy – Politics & Lifestyle

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Armstrong Faces $120M Fraud Lawsuit

A target has clearly been set upon Lance Armstrong to take the fall for doping in the 1999 Tour de France. With the US Postal Service as a sponsor, Armstrong recovered from cancer and won the Tour de France. Now that Armstrong has admitted to doping, the federal government wants its money back. Floyd Landis, Armstrong’s former rival and teammate, is spearheading the case. In 2010 he claimed that Armstrong, himself and other riders on the team doped on a continuous basis. The government issued a statement claiming the suit will rectify the years of broken promises during which Armstrong told his sponsors he was dope-free.

The Department of Justice and Landis faced a major hurdled they’ve already cleared-the Statute of Limitations. The “broken promises” started in 1998, which meant they’d be two years too late to sue, but DOJ and Landis have invoked the Wartime Suspension of Limitations Act; it stops the clock on the statute of limitations for fraud committed against the government during wartime.

The reasoning behind this is that since the U.S. has been at war since 2001, the statute of limitations countdown never started. This logic could cost Armstrong every dollar the Postal Service paid him. As dishonest as Armstrong’s been, it only takes a brief look into the history of the Wartime Suspension of Limitations Act to determine that its application in this case is a stretch, to say the least.

During and after World War II, The Act was originally intended to thwart those who sought to defraud the government through business with faulty goods or unfair pricing. It meant to allow the government to focus on the war at hand and buy them enough time to address matter of fraud when wartime was over. In 2008, this same Act proved successful in suing Robert Prosperi and Gregory Stevenson for selling inferior products for the Big Dig project in Boston.

Recent cases in which the Wartime Suspension of Limitations Act strengthen the Department of Justice’s case; Wells Fargo was sued for taking millions from the Federal Housing Administration by making up loans and hiding them from officials. French Bank PNB Paribas lost the lawsuit against them for fraud in 2005 because of the Act. With the Department of Justice armed with precedent relevant to this case, Armstrong has one of the toughest hills he’s ever faced ahead of him.

 

 

 

 

 

Photo: Photograph by Bas Czerwinski/AP Photo


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