WASHINGTON, April 23, 2013 – The US Justice Department filed a formal
complaint Tuesday against Lance Armstrong, saying the doping-disgraced cyclist
and team owners defrauded the US Postal Service of sponsorship money.
The government, which said in February that it would join a whistle-blower
lawsuit brought by former Armstrong teammate Floyd Landis in 2010, says the
USPS spent about $40 million in sponsor money and gave Armstrong $17 million.
Armstrong admitted last January that he took performance-enhancing drugs
when he won the Tour de France seven times after having been stripped of the
crowns based upon a US Anti-Doping Agency (USADA) investigation.
That prompted the US government’s involvement in the fraud case, and it now
seeks triple damages in a jury trial, according to the complaint as detailed
by NBC News and the Austin American-Statesman, Armstrong’s hometown newspaper.
That could mean a total $150 million hit for Armstrong.
“Because the defendants’ misconduct undermined the value of the sponsorship
to the USPS, the United States suffered damages in that it did not receive the
value of the services for which it bargained,” the newspaper quoted the
complaint as saying.
The elaborate scheme to evade doping detection uncovered by USADA was cited
in the complaint, which said Armstrong team manager Johan Bruyneel knowingly
took part in a doping program in violation of their sponsorship contract.
“Riders on the USPS-sponsored team, including Armstrong, knowingly caused
material violations of the sponsorship agreements by regularly and
systematically employing banned substances and methods to enhance their
performance,” the complaint claimed according to NBC.
“Defendants were unjustly enriched to the extent of the payments and other
benefits they received from the USPS, either directly or indirectly.”
Elliot Peters, Armstrong’s attorney, disputed whether the USPS suffered any
damage as a result of its 1998-2004 sponsorship of the team.
“The DOJ’s complaint against Lance Armstrong is opportunistic and
insincere,” Peters said in a statement.
“The US 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.”
Studies commissioned by the USPS said the team generated about $100 million
in exposure and brand awareness for the postal service, but how that brand
might be tarnished in the wake of the doping revelations has not been studied.