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Lance Armstrong

US govt. sues Lance Armstrong to recover tens of millions he collected while cheating

Thursday, May 02, 2013 by: J. D. Heyes
Tags: Lance Armstrong, USPS, doping scandal

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(NaturalNews) The U.S. government has filed a lawsuit against disgraced bicyclist Lance Armstrong in an attempt to recover millions of dollars in endorsements paid to him and his U.S. Postal Service team after he admitted that illegal blood doping helped him win a record seven Tour de France titles.

The Justice Department announced its formal complaint against Armstrong on April 23, accusing the cyclist of violating his contract with the Postal Service and that he was "unjustly enriched" while cheating his way to victory, The Associated Press reported.

The department had said previously it would join a whistleblower lawsuit that is being brought against Armstrong by Floyd Landis, a former teammate, under the federal False Claims Act. April 23 was the deadline to file its complaint.

Rounding them up

The USPS paid out some $40 million to be the principal sponsor of Armstrong's cycling teams for six of his seven victories, said the report. According to the filing in U.S. District Court in the nation's capital, the Postal Service paid Armstrong $17 million from 1998-2004.

The suit also names Johan Bruyneel, another former teammate, and Tailwind Sports, the team management company, as defendants.

"Defendants were unjustly enriched to the extent of the payments and other benefits they received from the USPS, either directly or indirectly," says the complaint.

Analysts believe the financial costs to both Armstrong and Bruyneel could be steep because Uncle Sam's Justice Department has said it would seek triple damages assessed by the jury.

Since publicly 'fessing up to his cheating, Armstrong has been dropped by sponsors and has had to leave the cancer-fighting "Livestrong" foundation he began in 1997.

Before Justice filed suit, Armstrong reportedly attempted to negotiate a settlement with the government, "but those talks fell through before the government announced it would join the Landis lawsuit," AP said. But, settlement talks could pick up again as the case heads to trial.

Armstrong admitted in January that he used performance-enhancing drugs following years of often vehement denials. He has argued that the Postal Service's endorsement of him earned the federal mail carrier far more than it paid him. His attorney, Elliot Peters, has labeled the government's suit "opportunistic" and "insincere."

"The U.S. Postal Service benefited tremendously from its sponsorship of the cycling team. Its own studies repeatedly and conclusively prove this," Peters told AP. "The USPS was never the victim of fraud. Lance Armstrong rode his heart out for the USPS team, and gave the brand tremendous exposure during the sponsorship years."

In order to win its case, the report said, the government must prove that the Postal Service was not only defrauded but also damaged in some way.

'Largest doping scandal in sports'

In previous studies, researchers have concluded that the Postal Service brought in at least $139 million from worldwide exposure in four years' time - $35-$40 million for sponsoring Armstrong's team in 2001; "$38 million to $42 million in 2002; $31 million in 2003; and $34.6 million in 2004," AP reported.

Paul Scott, an attorney for Landis, dismissed the notion that any monies gained by the USPS would negate the government's claims of fraud. In fact, he insisted that the Postal Service's reputation has been tainted by Armstrong's drug scandal.

"Even if the USPS received some ephemeral media exposure in connection with Mr. Armstrong's false victories, any illusory benefit from those times will be swamped over time immemorial by the USPS forever being tied to the largest doping scandal in the history of sports," Scott said, according to the AP.

According to the formal complaint, the government is heavily reliant on evidence and statements supplied by Landis and assembled by the U.S. Anti-Doping Agency for its 2012 investigation that exposed the USPS doping program. As a result of its findings and Armstrong's own admission of guilt, he has been banned from sports for life and was stripped of all seven of his Tour de France titles.

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