Filed: Apr. 03, 2020
Latest Update: Apr. 03, 2020
Summary: NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS APR 3 2020 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT CHRISTINA ELLIS; JONATHAN ELLIS, No. 18-17248 Relators; ex rel. United States of America, D.C. No. Plaintiffs-Appellees, 2:16-cv-01447-APG-NJK and MEMORANDUM* UNITED STATES OF AMERICA, Plaintiff, v. JING SHU ZHENG, Defendant-Appellant, and SJ 5308 INVESTMENT GROUP, Defendant. Appeal from the United States District Court for the District of Nevada Andrew P. Gordon,
Summary: NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS APR 3 2020 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT CHRISTINA ELLIS; JONATHAN ELLIS, No. 18-17248 Relators; ex rel. United States of America, D.C. No. Plaintiffs-Appellees, 2:16-cv-01447-APG-NJK and MEMORANDUM* UNITED STATES OF AMERICA, Plaintiff, v. JING SHU ZHENG, Defendant-Appellant, and SJ 5308 INVESTMENT GROUP, Defendant. Appeal from the United States District Court for the District of Nevada Andrew P. Gordon, ..
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NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS APR 3 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
CHRISTINA ELLIS; JONATHAN ELLIS, No. 18-17248
Relators; ex rel. United States of America,
D.C. No.
Plaintiffs-Appellees, 2:16-cv-01447-APG-NJK
and
MEMORANDUM*
UNITED STATES OF AMERICA,
Plaintiff,
v.
JING SHU ZHENG,
Defendant-Appellant,
and
SJ 5308 INVESTMENT GROUP,
Defendant.
Appeal from the United States District Court
for the District of Nevada
Andrew P. Gordon, District Judge, Presiding
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
Page 2 of 5
Submitted March 25, 2020**
Las Vegas, Nevada
Before: W. FLETCHER, BYBEE, and WATFORD, Circuit Judges.
Jing Shu Zheng appeals from the district court’s order granting summary
judgment in favor of Christina and Jonathan Ellis on their claim under the False
Claims Act (FCA). We affirm.
1. The district court correctly found no triable issue of material fact as to
Zheng’s liability under the FCA. It is true, as Zheng argues, that the Housing
Agreement Plan (HAP) does not bear her signature. But that fact is irrelevant
because the evidence clearly shows that Jay Hsu signed the document as her agent.
Hsu worked for the company that Zheng concedes acted as her authorized agent
(SJ 5318), and Zheng admitted in her counterclaim disclosures that Hsu was her
agent.
No reasonable factfinder could conclude, on the basis of the summary
judgment record, that Hsu enrolled Zheng in the Section 8 voucher program
without her knowledge or authorization. Zheng herself signed the Request for
Tenancy Approval, which represented that she had agreed to charge the Ellises
only $2,000 per month in rent, and she herself received the notices of adjustment
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
Page 3 of 5
of payment from the Southern Nevada Regional Housing Authority (SNRHA),
which also stated that the contractually agreed upon rent was $2,000 per month.
Yet the undisputed evidence shows that Zheng charged the Ellises $2,300 per
month, and that she received two separate payments from them each month: one
for the difference between $2,000 and the amount Zheng received in housing
assistance payments from SNRHA; and another for the extra $300 per month
Zheng was charging the Ellises. Zheng has offered no plausible explanation for
why she received payments in this fashion if she had not agreed to participate in
the Section 8 voucher program, or any explanation at all for why she would have
believed herself entitled to receive payments from SNRHA in the first place. The
evidence thus clearly shows that Zheng knowingly committed fraud on the
government by collecting more in rent than she was authorized to charge.
2. The district court did not clearly err in calculating the amount Zheng
must pay in damages and penalties. First, the court correctly held, in calculating
the penalties owed under the FCA, that each check Zheng received from SNRHA
was its own “claim against the government fisc” and thus its own separate FCA
violation. United States ex rel. Hendow v. Univ. of Phx.,
461 F.3d 1166, 1177 (9th
Cir. 2006). The district court appropriately imposed the lowest penalty per
violation authorized by the regulations—$5,500—for a total of $121,000 in
penalties based on the 22 violations Zheng committed. See 31 U.S.C.
Page 4 of 5
§ 3729(a)(1); 28 C.F.R. § 85.3(a)(9).
Second, the court properly calculated the amount owed in damages.
Because the FCA is concerned with fraud on the government, damages are
determined not by how much Zheng overcharged the Ellises, but rather by how
much Zheng overcharged the government—that is, the amounts she received from
the government without lawful entitlement. The HAP stated that Zheng would not
be entitled to any funds from the government if, as occurred here, she failed to
comply with the terms of the agreement. Accordingly, the damages owed are the
entire amount Zheng received from the government. See United States v. Mackby,
339 F.3d 1013, 1018–19 (9th Cir. 2003).
3. The penalties imposed by the district court are substantial, but they do not
violate the Excessive Fines Clause of the Eighth Amendment. The FCA
deliberately prescribes harsh penalties, reflecting Congress’s judgment that
committing fraud on the government is a serious offense. See 31 U.S.C.
§ 3729(a)(1); United States v. Bourseau,
531 F.3d 1159, 1173–74 (9th Cir. 2008).
The district court could have imposed double the penalty per violation. See
Mackby, 339 F.3d at 1018 (“We may properly consider the maximum penalty
prescribed by Congress as part of our Excessive Fines Clause inquiry.”). Indeed,
we have never found an FCA penalty within the range permitted by Congress to
violate the Excessive Fines Clause. See
Bourseau, 531 F.3d at 1173. Taking into
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account the severity of the crime, as adjudged by Congress, the harm to the
government, and the difference between the fine imposed and the penalties
authorized, the fine imposed on Zheng does not violate the Eighth Amendment.
AFFIRMED.