Feds Sue Armstrong For Defrauding U.S.

DOJ claims Armstrong 'unjustly enriched' himself with USPS sponsorship funds

The Justice Department officially filed suit against Lance Armstrong yesterday, claiming he and his management team defrauded the government of $40 million.

The complaint, filed in the U.S. District Court for D.C., seeks triple damages—which could be up to $120 million—against Armstrong, Tailwind Sports, and Tailwind’s manager Johan Bruyneel, for “unjust enrichment” at the expense of the United States. The complaint alleges that the defendants accepted sponsorship fees from the U.S. Postal Service while secretly conducting a doping scheme, in violation of their agreement.

The USPS paid Tailwind and its predecessor $40 million in sponsorship fees from 1998 through 2004 to manage the USPS cycling team, of which Armstrong was the lead rider. Tailwind used that money to pay Armstrong $18 million in salary, not including bonuses, according to the complaint.

By filing the complaint, the DOJ joins a suit by Armstrong’s teammate Floyd Landis, who blew the whistle on the cycling team’s alleged doping scheme. Landis will get part of the settlement if the suit succeeds, according to USA Today.

Armstrong’s lawyers dispute the claim that the USPS suffered damages from the alleged doping scheme—a charge the government must prove.

“The DOJ's complaint against Lance Armstrong is opportunistic, and insincere,” Armstrong attorney Elliot Peters said in a statement. “The U.S. Postal Service benefited tremendously from its sponsorship of the cycling team. Its own studies repeatedly and conclusively prove this. 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.”

Paul D. Scott, the attorney for Landis, disagreed with Peters’ assessment, saying in a statement to USA Today, “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.”

Complaint via OutsideOnline.com.