A U.S. District Court judge ruled Tuesday the Birmingham Jefferson County Transit Authority (BJCTA) must pay $4,315,403.22 in damages based on a False Claims Act (FCA) lawsuit filed in 2018 by a former employee and former board chair alleging the agency didn’t comply with all federal regulations regarding grant funding from the Federal Transit Authority (FTA).

The amount is triple the base damage amount of $1,438,467.74, as required by the FCA.

In the order, U.S. District Judge Corey L. Maze also ruled The BJCTA must also pay “an amount for reasonable [plaintiff] expenses which the court finds to have been necessarily incurred, plus reasonable attorneys’ fees and costs.”

Maze additionally awarded a civil penalty of $308,000, calculated based on $14,000 for each of 22 FCA violations.

The ruling came within a day of the one-year anniversary of Judge Maze’s ruling that the BJCTA must pay $1,080,000 in damages, plus the civil penalty. That figure was calculated after the original amount of funds the U.S. government granted the BJCTA ($1,438,467.74) was lowered based on a ruling that the agency received a “benefit” of only $1,078,467.14.

The difference (approx. $360,000) was tripled to reach the $1,080,000 amount assessed in 2022.

The BJCTA filed a 50(b) motion, which was denied in this week’s ruling. In the new order, Judge Maze revised the base amount of the damages back to the original $1,438,467.74, the basis for the newest damages owed.

According to the FCA statute, the whistleblowers – ex-employee Starr Culpepper and attorney O. Tameka Wren – are entitled to receive approximately 25% of the award, or $1,078,850.80, which they would share.

The remaining dollars would go to the FTA. The suit, in part, involved a $20 million FTA grant awarded to the City of Birmingham in October 2015 to construct the Bus Rapid Transit (BRT) system, now known as the Birmingham Xpress.

“Birmingham was awarded the World Games in January 2015,” the ruling states. “The City wanted to build a rapid bus system in time for the Games.” Originally scheduled for 2021, the Games were postponed to the summer of 2022 due to the global COVID-19 pandemic.

In 2015 BJCTA was led by Executive Director Barbara Murdock. She was fired in May 2018 by the BJCTA Board of Directors, nearly two months after she was suspended without pay for allegedly using the agency credit card for personal expenses, including a personal Alabama Power bill in the amount of $477.25.

Current BJCTA CEO/Executive Director Charlotte Shaw was hired in October 2021, following the tenure of Frank T. Martin, who guided the agency beyond perhaps the most troublesome period of its existence.

Shaw responded to AL.com’s request for comment Wednesday night.

“I cannot control the timing of this unfortunate incident, and we will respect the decision of the court,” Shaw said. “The BJCTA will continue to work in a positive direction of growth and concentrate on improving service for our riders.

Board Chair Ted Smith also said, “We have a great Board of Directors, with a great working relationship with the new CEO, and we are proud to be part of the new direction.”

The BJCTA could still appeal the ruling.

“This case is about the BCJTA’s failure to comply with the Brooks Act when using federal grants to pay for [consultant] Strada’s work on Birmingham’s Bus Rapid Transit (BRT) Project,” the judge’s order stated.

Specific claims were: “The BJCTA and its (former) executive director Barbara Murdock violated the False Claims Act by falsely implying compliance with the Brooks Act each time they requested federal grant money to pay for Strada’s work; Strada and its owner Edmund Watters violated the False Claims Act by making a false on-call contract, false invoices, and false task orders material to the BJCTA and Murdock’s false claims to the FTA; the four Defendants conspired with each other to violate the False Claims Act; and the BJCTA fired Relator Starr Culpepper because she complained to BJCTA executives about the BJCTA’s ongoing violations of the Brooks Act.

“The jury found that [Culpepper and Wren] proved the BJCTA falsely implied compliance with the Brooks Act when asking for federal grant money to pay for Strada’s work and awarded the Government compensatory damages.

“The jury rejected all of Relators’ (Culpepper and Wren) other claims. The jury found that Murdock did not know that the BJCTA was falsely implying compliance with the Brooks Act when the BJCTA submitted its reimbursement requests and that neither Strada nor Watters made false records or statements material to the BJCTA’s reimbursement requests.

“So the jury also found that Murdock, Strada, and Watters were not conspiring with the BJCTA to submit false claims. Finally, the jury found that Culpepper failed to prove that she acted to stop the BJCTA from violating the Brooks Act.”

Culpepper worked at the BJCTA as the executive assistant for board support and later as contract administrator from January 2013 until being fired in April 2018 for alleged misuse of a credit card. Wren served as board chair from October 2017 until resigning the following January “for personal reasons,” she said at the time.

In response to Tuesday’s ruling, Wren told AL.com: “I am hoping this leads to true systemic training and systemic change in our procurement processes—not just in Alabama but throughout the U.S., and that we have a fair process and understand the importance of federal and state regulations. I hope this leads to meaningful change.”

Read more on BJCTA:

Birmingham wins federal grant to reconnect communities separated by rail lines, highways

New transit CEO vows economic growth through transit

Departing BJCTA CEO drives vital, necessary change

On April 9, 2018, Culpepper and Wren filed a sealed lawsuit against the BJCTA, and myriad other defendants, many of whom were later released from the claims. The pair alleged they violated the False Claims Act by “knowingly perpetuating and participating in, and/or conspiring with others participating in schemes…to defraud the United States Government over a substantial period of time…and involving millions of dollars.”

“The BJCTA must pay the full amount of grant funds that it used to pay Strada as damages—about $1.44 million,” the order reads.

“The BJCTA has to pay another $2.88 million because the FCA requires the court to impose “three times the amount of damages which the Government sustains. The court finds that this extra $2.88 million fully reimburses the Government’s intangible interest in promoting compliance with laws and regulations that govern awards of government-funded contracts.

“In short, assuming the higher courts agree that the proper amount of the Government’s damages is the full amount paid, this court finds that the imposition of treble damages makes the government [federal taxpayers] whole.

“It seems things have changed since we were [at BJCTA,” Wren acknowledged. “I do sense change is coming.”

Culpepper did not respond to a request for comment.