Cyclist’s tortuous, protracted fraud case enters new phase

A national newspaper’s depiction of it as being a legal case that “has gone through more twists and turns than the Alpine climbs … that once established his reputation” seems just about right in spotlighting the high-level fraud case between cyclist Lance Armstrong and the federal government.

Here’s the gist. As many of our readers who are avid sports fans and close followers of the Tour de France know, Texas native Lance Armstrong was once considered a lock for the greatest professional cyclist who ever lived.

And then his world came crashing down, with mounting evidence of a massive doping fraud that Armstrong eventually confessed to.

That fraud became further spotlighted in 2010 pursuant to a qui tam whistleblower lawsuit against Armstrong that the government joined.

And here’s why: For years, Armstrong’s riding team was sponsored by and closely linked with the United States Postal Service. Following the fraud’s strong public emergence (reportedly, more than 150 billion online “impressions” followed the cyclist’s admission of guilt), the USPS claimed a material diminution of value in benefits derived from sponsorship.

The bottom line: Over a period of years, the USPS provided the Armstrong team with an estimated $32 million-plus in sponsorship money. The government is now demanding triple damages allowed under federal law for losses it claims it has sustained through association with the rider.

In other words, the government wants to be reimbursed for the fraud to the tune of nearly $100 million.

Unsurprisingly, Armstrong’s legal team is fighting back, alleging that the USPS “got more than it paid for and is not a victim of fraud.”

Obviously, the case is complex, with the huge numbers involved. No firm timetable regarding the matter has been stated.

The stakes are decidedly huge, of course. Notably, if the request for triple damages is dismissed, Armstrong’s civil liability could fall dramatically, reportedly to less than $500,000.