Federal Economist Loses Battle Over Award

WASHINGTON (CN) - A senior economist in the Department of the Interior helped a government watchdog group force oil companies to cough up $440 million in unpaid oil royalties in the 1980s, but a federal judge ruled that Robert Berman must return the $383,000 the watchdogs gave him as a "public service award."

Berman, who worked in the Interior Department's Office of Policy Analysis, has argued through several appeals that he should be allowed to keep the money that the Project on Government Oversight (POGO) gave him in 1998 for blowing the whistle.

But U.S. District Judge John Bates reaffirmed the government's position that POGO's payment violates a law that prohibits supplementing the salary of a federal employee as compensation for public work.

"Berman breached his fiduciary duty to the government by accepting an investment interest in POGO's litigation without any disclosure at all, and eventually accepting a payment from POGO without 'full disclosure,'" Bates wrote in a 40-page opinion.

"It is worth noting the obvious here: this is not a situation involving a gift modestly in excess of $200, but rather an investment interest and then cash in excess of $383,000 ... about which Berman made a conscious choice not to consult with his ethics official."

Berman argued unsuccessfully that whistleblowing falls outside of his government duties, so being rewarded for it does not constitute payment for his government work.

But the government "produced 'impressive' evidence at trial to show that Berman's work on oil royalty valuation issues was an assigned part of his job," Bates wrote.

A jury found in 2008 that Berman and POGO had violated the law and the court assessed a civil penalty of $383,000 against Berman and $120,000 against POGO. The D.C. Circuit found on appeal that the jury had been improperly instructed on the issue of intent and the case was remanded to District Court.

While Bates granted the government's motion for summary judgment against Berman, the government plans a separate trial against POGO.

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