LOS ANGELES—A Los Angeles Superior Court Judge ruled in favor of public interest organization, Jobs to Move America (JMA), on Monday, allowing its California False Claims Act (FCA) case against Canadian-based bus manufacturer New Flyer Industries Inc. to proceed.
The decision comes in response to a challenge brought by New Flyer arguing that there was no legal basis for the lawsuit. On Monday morning, Judge Randolph M. Hammock, overruled New Flyer’s demurrer, allowing JMA’s lawsuit to proceed and writing that JMA is “precisely the type of organization with precisely the type of mission that the Legislature intended to encourage to file these types of lawsuits.”
The decision reaffirmed the right of public interest organizations like JMA to hold companies accountable for failing to follow through on their legal obligations and commitments made in exchange for receiving billions of dollars in public funds.
This is the latest development in a court battle between the two groups. In November 2018, JMA, on behalf of the State of California and the Los Angeles Metropolitan Transportation Authority (LA Metro), filed a California False Claims Act complaint against New Flyer, the largest bus manufacturer in North America. The suit alleges that New Flyer defrauded LA Metro under a 2013 bus procurement contract by failing to comply with the contract’s wage and benefit commitments and by falsely asserting that its front-line workers were receiving fringe benefits equivalent to $11.75 per hour. JMA’s investigation found that not all workers were receiving benefits at this level.
“Today, we sent a message to all corporations that we will not stand by and allow them to benefit from lucrative public contracts and not follow through with their commitments to good jobs. New Flyer has defrauded the taxpayers of California, and JMA will hold them accountable for that.”Melanie Jamileh Prasad, JMA’s California Director.