Scripps Research Institute: Charging NIH for Work Outside the Grant

Scripps Research Institute agreed to pay $10 million to settle allegations of charging NIH for work outside the grant, including new grant applications, teaching and administration. The government alleged that existing research projects paid for faculty activities that belonged elsewhere. For someone inside a laboratory or grants office, the revealing comparison is between the work a researcher actually did and the work the grant account says it funded.

The Department of Justice announced the settlement on September 11, 2020. It described Scripps as a nonprofit biomedical research institute with campuses in Jupiter, Florida, and La Jolla, California, receiving NIH support through hundreds of grants each year.

The whistleblower alleged that Scripps obtained over $1.5 billion in federal grant funding from 2008 through 2014. This federal grant fraud case concerned how faculty time was charged to existing awards.

The Alleged Charges to Existing NIH Projects

From 2008 through 2016, the government alleged, Scripps lacked a system that let faculty properly account for time spent on activities that could not be charged directly to an NIH-funded project. That failure allegedly put the cost of developing, preparing and writing new grant applications onto existing research awards.

The government’s account draws a specific distinction. It said Scripps charged proposal work directly to existing projects instead of allocating it as indirect costs. It also alleged charges for committee work and other administrative tasks unrelated to the funded projects.

An existing award funds a particular research undertaking. Preparing the next proposal serves the institution’s search for future funding. The alleged accounting practice made the first pay for the second.

What the Effort Records Allegedly Hid

The whistleblower’s complaint alleged that awarded grants paid his entire salary while he also worked on new applications and resubmissions. It gave a concrete example of the mismatch:

U.S. ex rel. Burris v. The Scripps Research Institute, whistleblower’s complaint, paragraph 79

For 2008 through 2013, the whistleblower said he prepared and submitted at least eighteen new applications or resubmissions that were never awarded. He estimated that he spent between 20 and 50 percent effort on grant proposal activity. Splitting pay among awarded grants could make an account look detailed while leaving that work out of the picture.

According to the whistleblower, the effort report listed internal account numbers without descriptions identifying the grants or accounts. Scripps allegedly never explained how the hours attached to those numbers were calculated. The form did not distinguish work on awarded grants from new applications, teaching or other activities.

The complaint also alleged that a total of 160 hours was already printed on the effort form. Separately, the whistleblower said he left payroll documents unsigned and Scripps never followed up to obtain his signature. Those are different control failures: a form that obscures what the work was, and a signature line that allegedly did not require his signature in practice.

If you recognize that paperwork, you may know what the totals do not show. An unexplained account code says where the institution put the expense. It does not tell you which experiment, proposal or teaching assignment occupied the person whose salary was charged.

New Grant Applications Required Laboratory Work

The complaint described proposal preparation as scientific work as well as writing. It said the most labor-intensive part of an application was developing the experimental evidence: reviewing scientific literature, designing experiments and producing support for the proposed hypothesis. That could occupy the principal investigator and other members of the research team.

A rejected application could generate more work before resubmission. The whistleblower described reviewers’ critiques prompting additional experiments, compilation of results, data analysis and revised proposal language. He alleged that Scripps charged this unfunded experimental work to existing grants.

This detail matters to anyone who knows the laboratory but does not control its accounts. On the complaint’s account, the work could look like the rest of the lab’s research while serving a different funding request. A new experiment performed to answer a proposal reviewer’s objection has a purpose that the salary allocation alone may never reveal.

We see an existing project allegedly paying for the chase after the next award, with paperwork treating both as the same work. Same lab. Different work to account for.

The Salary Pressure Behind the Charges

The whistleblower alleged that Scripps expected faculty to cover their salaries and benefits entirely through federal grants, and to generate grant funding for research-staff salaries as well. He described that expectation as applying at both campuses.

He described faculty needing overlapping awards and a continuing stream of applications to keep salary funding in place when current grants ended. The complaint alleged pressure to secure that funding while existing grants continued to pay for the effort spent seeking it.

Teaching exposed the same tension. The whistleblower said he was asked to teach in the graduate program without receiving salary coverage for that work. He alleged that faculty who taught while drawing their full salaries from grants left those grants paying for teaching unrelated to the funded research.

The complaint also identified who lost out. It alleged that time spent on new applications displaced effort committed to funded medical research, and that Scripps gained an advantage over institutions that compensated researchers separately for proposal preparation. On that account, the benefit went beyond filling a payroll gap: the institute allegedly shifted part of the cost of competing for future awards onto awards it already held.

From Effort Reports to Requests for Money

The complaint connected the internal time records to what Scripps told the government. It alleged that grant applications, Just in Time Reports, certifications and payment requests misrepresented the effort of the whistleblower and researchers working under him by including work on new applications and other unrelated activities.

That connection is central to false grant performance certifications. Here, the whistleblower alleged a chain from the work performed, through the effort attributed to an award, to representations supporting federal funding. He also alleged that Scripps failed to reconcile committed effort with actual effort, concealing or avoiding an obligation to refund government money.

Researchers, payroll employees and grant administrators can recognize different parts of that chain. We work with an insider to connect those views, so that the account of the work and the account of the money can be understood together.

The Same Grant Reporting Problem Elsewhere

Columbia University admitted that certain effort reports contained inaccurate information and that its public health program mischarged federal grants for work that did not belong to those agreements. The government’s allegations included proposal writing and unrelated time, with reports produced and certified without verifying the actual grant work. It is a close comparison to Scripps because it connects the salary charge to the reliability of the effort certification.

In the Rice University case, the government alleged that National Science Foundation budgets and requests for funds charged stipends, tuition remission and associated overhead for graduate teaching unrelated to the funded research. The teaching obligation and the research account had been joined on paper, according to the allegations.

At UC Davis, the government alleged incomplete disclosures about overlapping federal grants, including which agency had already funded particular tasks and which grant produced accomplishments reported in applications and progress reports. The recurring question is concrete: which award paid for which work, and did the institution’s reports tell the same story?

The Scripps Settlement and Whistleblower Reward

The Scripps case began with a former employee’s False Claims Act qui tam lawsuit in the District of Maryland. The Department of Justice credited its Civil Division, the Maryland U.S. Attorney’s Office and the Department of Health and Human Services Office of Inspector General with the coordinated effort behind the settlement.

From that settlement, the announcement said the former employee would receive a $1.75 million whistleblower reward.

A whistleblower case under the False Claims Act can pay 15% to 30% of what the government recovers.

You Know Which Work the Grant Paid For

If you know the research behind the hours or the decisions behind the salary charges, speak with our whistleblower experts about the grant records you recognize. We build your strongest research grant whistleblower case with you, bring in federal grant fraud whistleblower lawyers who understand research effort and funding, and stay beside you the whole way.