Lance Armstrong Sued Over Millions in Prize Money
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UPDATED: Feb 8, 2013
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Former cycling star Lance Armstrong, who recently admitted to having taken performance enhancing drugs, is being sued by a prize-insurance company for the $12 million paid to him for three of his seven Tour de France wins, reports The Wall Street Journal.
The suit, filed in a state court in Dallas, Texas, was brought by SCA Promotions and claims that Armstrong and his agent, William Stapleton, conspired to commit fraud. The two defendants are also being accused of unjust enrichment and breach of contract. Prosecutors intend to show that by secretly using enhancement drugs, defendants attempted to defraud the prize insurance company into backing prizes that were won illegitimately.
In addition to these charges, Armstrong faces penalties of perjury. In 2006, Armstrong was asked during arbitration and under oath whether drugs were used during his tours and denied allegations. Three weeks ago, the former pro cyclist told Oprah Winfrey during an interview that he in fact had been cheating. Just after, the titles he had won last year were taken from him and he was formally charged by the U.S. Anti-Doping Agency for conspiracy to run organized doping endeavors, according to reports.
Understanding Civil Fraud Charges
Fraud charges can be either criminal or civil – in this case, Lance Armstrong is facing civil fraud charges. In order to prove Armstrong’s guilt, the Plaintiff must prove the following elements: 1) that there was a misrepresentation of an important fact (that Armstrong took the enhancing drugs); 2) that he knew the information he was giving was false information that the victim relied on; and, 3) a victim suffered an actual loss or injury because of that reliance (the insurance company suffered a monetary loss). If convicted in civil court, Armstrong will be ordered to pay damages to the Plaintiff of $12 million, which is the amount SCA claims they insured of false winnings Armstrong acquired through fraud.