Full opinion text
MEMORANDUM AND ORDER WOODLOCK, District Judge. The United States seeks substantial damages arising from alleged improprieties in a government-sponsored Harvard project to assist Russia in developing capital markets and foreign investments. The government’s contract with Harvard barred employees who were assigned to what was known as the “Russia Project” from conducting certain business and investment activity that could give rise to real or apparent conflicts of interest.' The government contends that defendants Andrei Shleifer and Jonathan Hay, who were senior supervisory figures at the Russia Project, nevertheless wrongfully invested and conducted business in- Russia, resulting in a breach of the contract by Harvard. Moreover, the government contends that Harvard and the two employees thereafter knowingly caused documents to be submitted that falsely certified, in violation of the Federal False Claims Act (“FCA”),‘ that Harvard was complying with the contract, and that these documents had the practical effect of inducing continued payments to Harvard. The matter is now before me on cross motions for summary judgment. I. BACKGROUND A. Facts In October 1992, Congress enacted the Freedom for Russia and the Emerging Eurasian Democracies and Open Market Support Act of 1992. 22 U.S.C. §§ 5801 et seq. The Act authorized the United States Agency for International Development (“USAID”) to implement a program to help the states of the former Soviet Union “work toward the creation of democratic institutions and an environment hospitable to foreign investment based upon the rule of law.” 22 U.S.C. § 5811(6)(B). In 1992, USAID entered into a Cooperative Agreement with the Harvard Institute for International Development (“HIID”), a Harvard University entity, to create a program to support the Russian reform effort. This program was referred to as the “Russia Project.” The two parties signed a second Cooperative Agreement to continue the program’s efforts, effective October 11, 1995. 1. The Cooperative Agreements The cover letter of the first Cooperative Agreement stated that the agreement was being made to the recipient “on condition that the funds will be administered in accordance with the terms and conditions as set forth in [an attachment entitled] ‘Standard Provisions,’ which have been agreed to by your organization.” The cover letter to the second agreement contained similar language. Included in the Standard Provisions of both agreements were the Regulations Governing Employees (“RGEs”). The RGEs contained a conflict of interest clause: Other than work to be performed under this grant for which an employee is assigned by the grantee, no employee of the grantee shall engage directly or indirectly, either in the individual’s own name or in the name or through an agency of another person, in any business, profession, or occupation in the foreign countries to which the individual is assigned, nor shall the individual make loans or investments to or in any business, profession or occupation in the foreign countries to which the individual is assigned. The first Cooperative Agreement also required that the grantee “maintain a code or standards of conduct that shall govern the performance of its officer's, employees or agents engaged in the awarding and administration of contracts using AID funds.... Such standards shall provide for disciplinary actions to be applied for violations of such standard by the grantees’ officers, employees or agents.” The second Cooperative Agreement similarly called for written standards of conduct governing real or apparent conflicts of interest. The cover letter to the second Cooperative Agreement also stated that the award was being made “on condition that the funds will be administered in accordance with the terms and conditions as set forth in 22 C.F.R. § 226.” That section provided: The recipient shall maintain written standards of conduct governing the performance of its employees engaged in the award and administration of a contract supported by Federal funds if a real or apparent conflict of interest would be involved. Such a conflict would arise when the employee, officer, or agent, any member of his or her family, his or her partner, or an organization which employs or is about to employ any of the parties indicated herein, has a financial or other interest in the firm selected for an award. The officers, employees, and agents of the recipient shall neither solicit nor accept gratuities, favors, or anything of monetary value from contractors, or parties to su-bagreements. However, recipients may set standards for situations in which the financial interest is not substantial or the gift is an unsolicited item of nominal value. The’ standards of conduct shall provide for disciplinary actions to be applied for violations of such standards by officers, employees, or agents of the recipient. 22 C.F.R. § 226.42 (1995). The requirement of written standards of conduct governing real or apparent conflicts of interest was satisfied by a conflict of interest provision in the HIID Overseas Manual. ' That provision prohibited “employees and members of their families” from engaging in any: [Financial transactions or investments within the Project Country ... The only financial transactions that are permissible are the exchange of currency in legal markets, the purchase of goods and services, and the maintenance of bank accounts consistent with the provisions of this section. The restriction against any financial transactions or investments in the Project Country arises because each HIID overseas group examines under official or semi-official auspices a wide range of local economic matters, knowledge of ‘which at least presents the actual possibility or appearance of exploitation for personal gain. For this reason, HIID does not permit or condone transactions by an Employee or by family members, even if legal, which might suggest a possible conflict of interest between the team’s professional work and the private profit of team members. Prohibited transactions or investments included “holding of debt instruments, maintaining any interest whatsoever in any local business, or making investments of any kind in the Project Country.” Violation of the policy was grounds for “immediate dismissal.” 2. Project Supervisors Andrei Shleifer served as a Project Director of the Russia Project throughout the two agreements. Under the second agreement, he was the sole Project Director. Shleifer is a tenured Professor of Economics at Harvard University in Harvard’s Faculty of Arts and Sciences. He is married to Nancy Zimmerman who, during the time relevant to this litigation, managed a hedge fund known as Farallón Fixed Income Associates. During the period of the second Cooperative Agreement, Shleifer also held the title of Principal Investigator. Rosanne Kumins, the Assistant Director for Contract Administration at HIID, also referred to Shleifer as the project “Back-stopper,” meaning the “responsible senior person in Cambridge.” Shleifer engaged in some administrative tasks as Project Director, including the recruitment and selection of personnel. Shleifer recalls that “quarterly reports were shown to [him] for comments periodically” throughout his time on the Project. He also signed “Principal Investigator Approval” for at least one subcontractor agreement under the second Cooperative Agreement. Within the Project’s operations, it was considered appropriate to approach Shleifer, among others, for advice regarding conflict of interest issues. Jonathan Hay, a Harvard Law School graduate, was a Moscow-based employee of the Russia Project as of January 1993. By the second quarter of 1993, Hay was a Project Associate, and from October 1995 on, he was the Project’s General Director. As General Director, he led a program to coordinate legal reform assistance, known as the Legal Reform Project, which officially began in July 1994 through an amendment to the first Cooperative Agreement. In a memo to USAID, Hay identified himself as the Legal Reform Project’s principal liaison to USAID in Moscow. The Institute for Law-Based Economy (“ILBE”), a subcontractor of the Legal Reform Project, was a Russian non-profit organization that provided substantive and administrative support for the Legal Reform Project. Hay exercised some oversight over the ILBE project and approved invoices for payment indicating that he was “aware of’ and “agree[d] with” charges that ILBE submitted to the Legal Reform Project. Hay was HIID’s top advisor in Moscow and was charged, according to an HIID draft of the 1997 workplan, with “the overall development, management and implementation of HIID’s program ... He reported] only to Mr. Shleifer.” Kumins referred to Hay as the Project’s “chief of party,” meaning that he was “responsible for the workings of the Moscow office.” Hay, however, does not recall the term “chief of party” being used in connection with the Project. As of late 1995 or early 1996, Hay was involved in a romantic relationship with Elizabeth Hebert. Hebert operated the Pallada Asset Management Company (“Pallada”), a mutual fund management company that, in August 1996, became the sixth company to receive an operating license from the Russian Federal Commission on Securities and the Capital Market (the “Commission”). In September 1996, Pallada was the first such company in Russia to register its mutual fund with the Commission. 3. The USAID Investigation In early 1997, USAID’s Inspector General began an investigation into alleged conflicts of interest by Hay and Shleifer. Harvard first learned of the investigation in April 1997. On or about May 20, 1997, USAID temporarily suspended the Project. The Russian government suspended it on the same or next day. On May 23, 1997, HIID terminated Hay’s employment for violating HIID’s conflict of interest policy, and removed Shleifer (who retained his position in the Department of Economics) from the Russia Project. USAID permanently terminated the Project on June 6,1997. B. Procedural History On September 26, 2000, the United States filed a complaint alleging eleven distinct legal claims against Harvard, Shleifer, Hay, Hebert, and Zimmerman. Three claims arose from the False Claims Act, 31 U.S.C. §§ 3729(a)(l)-(3), and the other eight arose from various common law theories. I granted Hebert and Zimmerman’s motions to dismiss all claims against them. I also granted the remaining defendants’ motions to dismiss Count V (breach of fiduciary duty), Count X (aiding and abetting), and Count XI (civil conspiracy). Finally, I bifurcated two of the government’s claims, Count VII (payment by mistake) and Count IX (unjust enrichment and disgorgement), and postponed their consideration to a remedy phase. II. DISCUSSION Six claims remain for potential resolution on summary judgment: Counts I (false claims under 31 U.S.C. § 3729(a)(1)), II (false statements under 31 U.S.C. § 3729(a)(2)), III (conspiracy under 31 U.S.C. § 3729(a)(3)), IV (common law fraud), and VIII (fraudulent inducement), all of which were pled against all three remaining defendants, and Count VI (breach of contract), pled against Harvard only. Though the government places the FCA claims first and foremost, all the claims ultimately arise from the alleged violation of the RGEs. Because Count VI (breach of contract) turns on the same factual, legal, and interpretative questions concerning the alleged violation of the RGEs that underlie all the other remaining claims, yet lacks the additional elements that the other claims require, I analyze Count VI first, and then build from there. A. Standard of Review Summary judgment is appropriate when “the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). A party seeking summary judgment must make a preliminary showing that no genuine issue of material fact exists. Nat’l Amusements, Inc. v. Town of Dedham, 43 F.3d 731, 735 (1st Cir.1995), cert. denied, 515 U.S. 1103, 115 S.Ct. 2247, 132 L.Ed.2d 255 (1995). Once the movant has made such a showing, the nonmovant must point to specific facts demonstrating that there is, indeed, a trialworthy issue. Id. A fact is “material” if it has the “potential to affect the outcome of the suit under the applicable law.” Santiago-Ramos v. Centennial P.R. Wireless Corp., 217 F.3d 46, 52 (1st Cir.2000), and a “genuine” issue is one supported by such evidence that “a ‘reasonable jury, drawing favorable inferences,’ could resolve it in favor of the nonmoving party.” Triangle Trading Co., Inc. v. Robroy Indus., Inc., 200 F.3d 1, 2 (1st Cir.1999) (quoting Smith v. F.W. Morse & Co., Inc., 76 F.3d 413, 427 (1st Cir.1996)). “[Cjonclusory allegations, improbable inferences, and unsupported speculation,” are insufficient to establish a genuine dispute of fact. Medina-Munoz v. R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir.1990). In this case, which involves both the interpretation of Cooperative Agreements drafted by the government and a factual determination whether certain transactions violated conflict of interest provisions in those agreements, two additional principles apply. In construing the agreements, the rule of contra proferentem requires that latent ambiguity in a government agreement be construed against the government as the drafter. WDC W. Carthage Assocs. v. United States, 324 F.3d 1359, 1364 n. 2 (Fed.Cir.2003). On the other hand, in determining whether a transaction by a defendant subject to the conflict of interest provisions in fact violated those provisions, a court is informed by the maxim that “[m]en must turn square corners when they deal with the Government.” Rock Island, Ark. & La. R. Co. v. United States, 254 U.S. 141, 143, 41 S.Ct. 55, 65 L.Ed. 188 (1920) (Holmes, J.). B. Count VI: Breach of Contract The government claims that, while working on the Russia Project, Shleifer and Hay invested and conducted business in breach of the Cooperative Agreements. The government argues that Harvard is liable for their breach because the Cooperative Agreements are enforceable contracts. Liability for breach of contract requires: (1) a valid contract, (2) an obligation or duty arising out of that contract, (3) a breach of that duty, and (4) damages caused by the breach. Flathead Joint Bd. of Control v. United States, 30 Fed. Cl. 287, 294 (1993), aff'd, 59 F.3d 180, 1995 WL 380585 (Fed.Cir.1995). For the reasons discussed below, I find that the Cooperative Agreements were valid contracts between Harvard and USAID, that they created an obligation to remain free of conflicts of interest, and that actions by Hay and Shleifer breached that duty. 1. Harvard is a Party to the Cooperative Agreements, Which Are Valid Contracts a. The Cooperative Agreements are Contracts The two Cooperative Agreements in this case were entered into subject to the Federal Grant and Cooperative Agreement Act of 1977, 31 U.S.C. §§ 6301 et seq. (“FGCAA”). The FGCAA distinguishes between three types of instruments: cooperative agreements, grant agreements, and procurement contracts. Whether a FGCAA cooperative agreement can constitute a valid contract has generated some litigation. The defendants rely heavily on the trial court’s decision in Trauma Service Group, Ltd. v. United States, 33 Fed. Cl. 426 (1995) (“Trauma I ”), aff'd on other grounds, 104 F.3d 1321 (Fed.Cir.1997) (“Trauma II ”). Trauma I held that cooperative agreements are not contracts because the FGCAA specifically provides for the creation of separate contractual undertakings: procurement contracts. Likening the agreement at issue in Trauma I — a Memorandum of Agreement (“MOA”) — to a cooperative agreement, the trial court held that a “cooperative agreement or assistance agreement is not a contract.” Id. at 429 (citing Council on Envt’l Quality, 65 Comp. Gen. 605, 605-07 (1986)). The Federal Circuit has twice criticized this aspect of the Trauma I decision, albeit in dicta. See Trauma II, 104 F.3d at 1326; Total Med. Mgmt., Inc. v. United States, 104 F.3d 1314, 1319-20 (Fed.Cir.1997), cert. denied, 522 U.S. 857, 118 S.Ct. 156, 139 L.Ed.2d 101 (1997). In Trauma II, the Federal Circuit stated that “contrary to the opinion of the trial court, a MOA can also be a contract — whether this one is, we do not decide.” 104 F.3d at 1326. It observed that any agreement with the government can be a contract if it meets the following requirements: “mutual intent to contract including an offer and acceptance, consideration, and a Government representative who had actual authority to bind the Government.” Id. at 1326. I agree with the opinions criticizing the Trauma I court’s reasoning. The Trauma I court failed to consider that the FGCAA’s definition of procurement contracts was not intended to classify other types of agreements as non-contractual. See Jeffrey C. Walker, Note, Enforcing Grants and Cooperative Agreements as Contracts Under the Tucker Act, 26 Pub. Cont. L.J. 683, 696 (1997). That the purpose of a cooperative agreement is assistance and not procurement is not disposi-tive of the determination of whether a cooperative agreement is a contract. Thermalon Indus., 34 Fed. Cl. at 417-18. An “ ‘agreement’ is broader in scope than [a] ‘contract’ in that agreements encompass both contracts, and arrangements that do not qualify as contracts.” Id. (internal citations omitted). “Therefore, Congress’ use of the term ‘agreement’ in the [FGCAA] to describe a grant relationship cannot reasonably be interpreted as an indication that Congress intended for all grant agreements not to constitute contracts ....” Id. Here, the Cooperative Agreements between Harvard and USAID constitute contracts to assist Russia in developing capital markets and foreign investments. By their signatures to the contracts, both parties received a benefit and a burden. USAID did not enter into the Cooperative Agreements with HIID merely for the benefit of Russia. Cf. United States v. Thomas B. Bourne Assocs., 867 F.Supp. 919, 921 (E.D.Pa.1973) (finding no pecuniary interest in a USAID program to finance improvements to an airport in British Guiana). The government undoubtedly sought to benefit economically and otherwise from the facilitation of Russia’s transition to a market economy through privatization. Cf. Quiman, S.A. de C.V. v. United States, No. 98-5036, 1999 WL 44182 (Fed.Cir. Jan.21, 1999) (finding a cooperative agreement under which the Department of Agriculture would provide inspectors for Quiman’s facilities, and Qui-man would help defray expenses of the inspections, was not too indefinite to constitute an enforceable contract and should not fail for lack of consideration). b. Harvard is a Party to the Agreements Harvard maintains that HIID was the only grantee under the Cooperative Agreements, while the United States insists that Harvard itself is the grantee and therefore bound by the contracts. At the outset, it is important to outline precisely what is at stake in this particular dispute, and to separate two similar but logically distinct legal relations. Whether Harvard • or HIID is the grantee for purposes of the RGEs is mainly relevant to whether Shleifer — whose status as an “employee of the grantee” is disputed — was covered by the RGEs. Resolution of that question turns on the text of the Cooperative Agreements, the federal regulations governing such agreements, and (to a lesser extent) the contemporaneous understandings of USAID and Harvard. On the other hand, whether Harvard or HIID (or both) is a party for purpose of contractual liability is a much simpler question turning on Harvard’s and HIID’s respective legal capacity to make contracts and be bound by them. Put differently, the “grantee” dispute concerns whether Shleifer could have violated the RGEs, while the “party” dispute concerns whether the United States can sue Harvard for breach of contract for such violations. i. “Grantee” The Shleifer and Harvard arguments are primarily based on the text of the Cooperative Agreements and the statutory and regulatory framework that creates the legal relation of “grantee” in the first place. The government’s arguments, by contrast, are primarily based on the operational reality of HIID’s status as a division of Harvard and how various intraHarvard entities, including HIID, interacted to process the grant application and other paperwork. The government first argues that HIID could not possibly be the sole recipient under the Cooperative Agreements, because it is not a separate legal entity from Harvard, and has no power to make contracts on its own separate behalf. See In re Sugar Indus. Antitrust Litigation, 579 F.2d 13, 18 (3d Cir.1978) (“A division of a corporation is not a separate entity but is the corporation itself.”). The statutes are somewhat unclear on whether an unincorporated internal division of a university may qualify as a recipient of a USAID cooperative agreement. Under the FGCAA’s scheme, the recipient here qualifies as an “other recipient,” defined as “a person or recipient (except a State or local government) authorized to receive United States Government assistance or procurement contracts and includ[ing] a charitable or educational institution.” 31 U.S.C. § 6302(4). While some aspects of this definition — reference to “person” and “institution” — seem to suggest that the recipient must be a separate jural entity, other aspects — the incorporation by reference of unspecified “authority] to receive United States Government assistance or procurement contracts” — suggest a broader view. In fact, Harvard contends that such “authority” may be found in the Foreign Assistance Act of 1961, 22 U.S.C. §§ 2295 et seq. which provides that the government may “make and perform agreements and contracts with, or enter into other transactions with, any individual, corporation, or other body of persons.” 22 U.S.C. § 2395(b) (emphasis added). Taken as a whole, the statutory text suggests that Congress intended to allow USAID to designate, as recipient of a cooperative agreement, something less than a distinct legal entity. USAID’s regulations support this point by what they do not say. Nearly thirty federal agencies, in their regulations concerning cooperative agreements, include a standard definition that “[t]he grantee is the entire legal entity even if only a particular component of the entity is designated in the grant award document.” E.g., 7 C.F.R. § 3016.3 (Department of Agriculture), 10 C.F.R. § 600.202 (Department of Energy), 13 C.F.R. § 143.3 (Small Business Administration), 14 C.F.R. § 1273.3 (NASA), 15 C.F.R. § 24.3 (Department of Commerce), 20 C.F.R. § 437.3 (Social Security Administration), 21 C.F.R. § 1403.3 (Office of National Drug Control Policy), 22 C.F.R. § 135.3 (Department of State), 42 C.F.R. § 67.11 (Public Health Service). USAID’s regulations, tellingly, do not. Nor does its handbook, which simply defines recipient as “any foreign or domestic nongovernmental entity which receives a grant or agreement from AID.” (Ex. 318, at 11 § 1F.5.) The United States was evidently not troubled by HIID’s lack of separate legal status when it entered into the Cooperative Agreements, which specifically identify HIID as the “Recipient.” (Ex. 15, at 1; Ex. 245, at 5; see also Ex. 322.) Ordinarily, this might end the analysis. However, during the lifetime of the Cooperative Agreements, Harvard did not seem as insistent that HIID (and only HIID) was the recipient as it does now for purposes of this litigation. The record shows that Harvard had ultimate responsibility for the administration of the agreements, and non-HIID personnel were frequently involved in that administration. The second Cooperative Agreement was signed by the Associate Director of the Office of Sponsored Research (“OSR”) on behalf of Harvard. The document entitled “Certifications, Assurances, and Other Statements of Applicant/Grantee to USAID” for the second Cooperative Agreement identifies the “Applicant/Grantee” as “HIID” on the cover page, “Harvard University (HIID)” on another, and “President and Fellows of Harvard College” on the signature line. (Ex. 427 at 111, 115, 128.) That document states that the grantee “operates as a corporation under the laws of Massachusetts ... [and] a private college or university.” (Id. at 128.) The document was signed by Kathleen Mercier of OSR. (Id.) Indeed, Rosanne Kumins, HIID’s Assistant Director of Contract Administration, once informed Shleifer that “[s]ince the grantee is the President and Fellow [sic], this [clause in the Cooperative Agreements] refers to all University employees.” (Ex. 383.) Harvard often represented to the United States that it was the recipient. OSR representatives regularly signed and submitted to USAID three types of financial forms used to process Russia Project funds: Form SF-272, known as Federal Cash Transaction Reports (“FCTRs”), and Form 5805, known as Requests for Funds, were submitted monthly, and Form SF-269, known as Financial Status Reports (“FSRs”), were submitted quarterly. Most of these forms list the “Recipient Organization” as “President and Fellows of Harvard College.” (E.g., Ex. 65.) In the picture that emerges, operational reality was not always subject to tidy legal categories. HIID did the actual work under the Cooperative Agreements, but other offices within Harvard (mainly OSR) handled much of the paperwork. There is little evidence that anyone at either Harvard or USAID paid thoughtful attention to whether HIID or Harvard was the recipient, presumably because HIID is in fact part of Harvard, and because the one issue where it appears to matter (the scope of the RGEs) was not salient at the time. Even after this litigation had commenced, Harvard deposition witnesses frequently contradicted themselves, and one another, as to whether Harvard or HIID was the recipient. (See, e.g., Kumins 49 (“Harvard is the recipient of the project. The grantee and executing agency is HIID.”); Mora 12, 15.) The impression formed from the deposition transcripts is not that the witnesses are evading the question, but rather that they themselves are genuinely confused. Given these facts, I cannot dispose of the issue by simply quoting the recipient identification in the Cooperative Agreements and ignoring the reality of how Harvard and HIID interpreted those agreements when they were formed. The government’s position (in its role as litigator) is essentially that Harvard did not strictly enforce boundaries between HIID and OSR in the performance of the agreements, or even in the paperwork necessary to form the agreements in the first place. On the other hand, the government (in its role as regulator) conspicuously declined to promulgate an “entire entity” rule for USAID cooperative agreement recipients as it did for other agencies’ cooperative agreement recipients. While Harvard’s internal systems for dealing with USAID were sufficiently tangled that Harvard could not always give a straight answer as to who the recipient was, the fact remains that, in the most important legal documents, the government almost invariably identified HIID as the recipient. Based on the Cooperative Agreements’ identification of HIID as the recipient, the statutory and regulatory framework that both permits agencies to name entities without an independent legal existence as grantees, and under which USAID declined (and apparently continues to decline) to promulgate a contrary “entire entity” rule, I find that HIID is the sole recipient under the Cooperative Agreements. Harvard’s muddled self-identification in its paperwork filed with the government does not overcome the plain identification of HIID as the recipient in the agreements, and the government cannot through this litigation create an “entire entity” rule for USAID recipients that it declined to create in its regulations and administrative documents. ii. Party It is much simpler to determine whether Harvard was an entity contractually liable for breach of the agreements. Within Harvard’s internal structure, only OSR was authorized to sign cooperative agreements, and when it did so, it signed on behalf of the President and Fellows of Harvard College. (Mora 10-11.) Furthermore, because HIID is not a distinct legal entity, suing HIID means suing Harvard. “[A]n unincorporated division cannot be sued or indicted, as it is not a legal entity.” United States v. ITT Blackburn Co., 824 F.2d 628, 631 (8th Cir.1987). Because agents with the actual authority to contract on behalf of Harvard entered into the Cooperative Agreements, Harvard is liable for any breach committed by HIID personnel. 2. Application of the Regulations Governing Employees to Hay and Shleifer The government contends that RGEs applied to both Hay and Shleifer, as employees of the grantee, Harvard University. It is undisputed that Hay was a HIID employee assigned to Russia from January 1, 1993 through April 1997. As such, both the RGEs and the “Conflict of Interest and Illegal Transactions” provision in the HIID Overseas Manual applied to Hay. Shleifer, however, argues that he was not subject to the RGEs, which applied to “employees,” because he was only a consultant to HIID, not an employee. This dispute obviously turns on whether Harvard or HIID is the “grantee” for purposes of the RGEs: if Harvard is the grantee, then Shleifer- — undisputedly an employee of Harvard University — is an employee of the grantee. On the other hand, if HIID is the grantee, then whether Shleifer was subject to the RGEs depends on whether he was a consultant to HIID (as he maintains) or an employee of it (as the government maintains). Since I have determined that HIID was the sole recipient/grantee under the Cooperative Agreements, Shleifer was only subject to the RGEs if he was an employee of HIID. This is because the RGEs specifically apply to “employee[s] of the grantee.” (Ex. 15, at 62.) Were there any doubt as to whether consultants were somehow subsumed into this provision, it would be quelled by examination of two other virtually identical regulations that USAID has adopted. First, an earlier version of the standard RGEs explicitly applied to a “regular or short term employee or consultant of the Grantee.” (Ex. 347,. at 19 § 21(c) (emphasis added).) Second, USAID’s parallel restrictions for services procurement contracts continue to apply to an “employee or consultant of the contractor.” 48 C.F.R. § 752.7027(e) (emphasis added). The fact that USAID removed the consultant restriction from the pre-1985 version of the standard RGEs applicable to cooperative agreements, yet left it in the procurement contract RGEs, leads to the inference that USAID intended consultants to be exempt from the RGEs. I must therefore turn to whether Shleifer was an employee of, or a consultant to, HIID. Whether a worker is an employee or an independent contractor is a question that has recurred in the decisions of state and federal courts for over a century, in such diverse areas of law as workers compensation, collective bargaining, taxation, and even intellectual property. See, e.g., Community for Creative Non-Violence v. Reid, 490 U.S. 730, 752-53, 109 S.Ct. 2166, 104 L.Ed.2d 811 (1989) (determining that sculptor was independent contractor, not employee, for purposes of Copyright Act); NLRB v. United Ins. Co., 390 U.S. 254, 256, 88 S.Ct. 988, 19 L.Ed.2d 1083 (1968) (under National Labor Relations Act, courts must apply common law agency test to distinguish employee from independent' contractor). In the absence of a specific definition of “employee” or “consultant” in the RGEs, I find that the common law test for distinguishing an employee from an independent contractor applies. Under the common law, an employee (or servant) is “an agent employed by a master to perform service in his affairs whose physical conduct in the performance of the service is controlled or is subject to the right to control by the master,” whereas an independent contractor is one “who contracts with another to do something for him but who is not controlled by the other nor subject to the other’s right to control with respect to his physical conduct in the performance of the undertaking.” Restatement (Second) of Agency §§ 2(2)-(3). Factors for determining whether one is an employee or an independent contractor include: the hiring party’s right to control the manner and means by which the product is accomplished ... the skill required; the source of the instrumentalities and tools; the location of the work; the duration of the relationship between the parties; whether the hiring party has the right to assign additional projects to the hired party; the extent of the hired party’s discretion over when and how long to work; the method of payment; the hired party’s role in, hiring and paying assistants; whether the work is part of the regular business of the hiring party; whether the hiring party is in business; the provision of employee benefits; and the tax treatment of the hired party. Community for Creative Non-Violence, 490 U.S. at 751-52, 109 S.Ct. 2166; see also Restatement (Second) of Agency § 220(2) (similar factors); Rev. Rul. 87-41, 1987-1 C.B. 296, 298-99, 1987 WL 419174 (similar factors). Furthermore, “if the relationship of employer and employee exists, the designation or description of the relationship by the parties as anything other than that of employer and employee is immaterial.” Rev. Rui. 87-41. Application of these factors in this case is complicated by two issues. First, Shleifer was undisputedly a Harvard employee; the only dispute is whether he was employed at least partially by the HIID division of Harvard, or just by the Faculty of Arts and Sciences. This is completely unlike the typical case, where the worker has just one relationship to the employer. Second, an examination of Shleifer’s daily regimen at HIID (what work to do, as well as when and where to do it) must be tempered by the knowledge that his ordinary, non-HIID role was that of a tenured academic, a job description as flexible and autonomous as any employee position in our society. The government’s main argument is that Shleifer was an employee of HIID because the income he was paid by HIID was typically described in correspondence as “salary,” and he reported it on his income tax return as “wages.” In fact, he had income tax withheld and reported to the Internal Revenue Service on Form W-2 (the form used for payments to employees); HIID never issued him a Form 1099, which would be used for an independent contractor. Perhaps most importantly, Shleifer was in charge of the entire Russia Project, and classifying him as a consultant would result in the anomalous circumstance that the head of the project was exempt from the conflicts of interest regulations, whereas a clerical employee would be subject to them. Shleifer’s main argument is that his memoranda of understanding with HIID consistently described him as a “consultant,” never an employee. Furthermore, Shleifer generally maintained some degree of separation between himself and HIID. He at all times remained an employee of Harvard’s Faculty of Arts and Sciences, and retained his position in the Department of Economics; all his work for HIID was done from his Department of Economics office, using his secretary and resources there, and he never obtained an office at HIID’s building; his administrative contact at HIID was always the person responsible for dealing with consultants, not the person responsible for dealing with HIID employees; and, internally, he always remained on the Faeulty of Arts and Sciences payroll, even when the Faculty charged his salary to a HIID account. Shleifer did maintain a careful separation between himself and HIID, in some ways much more of a separation than independent contractors in other fields, who often work at the employer’s offices and under fairly direct control. However, Shleifer’s unique role at HIID, and both his own and Harvard’s contemporaneous description of his income as “wages” or “salary,” suggest an employee relationship. While Shleifer’s “consultant” status at HIID appears to have some real significance in Harvard’s internal financial and time-allocation system, by which his salary was charged to various accounts of the same entity, the evidence indicates that the distinction was purely Harvard-internal, with no legal significance as against the outside world. Indeed, on the only occasions that Shleifer (or Harvard) appear to have had to categorize Shleifer’s status vis-á-vis HIID to a non-Harvard entity — submission of tax forms to the Internal Revenue Service — he was represented as an employee, never an independent contractor. For these reasons, I find no genuine dispute of material fact as to Shleifer’s status as an employee of HIID. Shleifer also argues that the RGEs do not apply to any investments he made while Project Director because the regulations govern investments only “in the foreign countries to which the individual is assigned,” and he was not “assigned to” Russia. I find that this issue cannot be resolved on summary judgment because the phrase “assigned tó” is ambiguous. “[A] contract is ambiguous only when its terms lend themselves to more than one reasonable interpretation.” Blackie v. Maine, 75 F.3d 716, 721 (1st Cir.1996). The Cooperative Agreements do not define the phrase “in the foreign countries to which the individual is assigned.” Because the provision refers to “foreign countries ” to which a single “individual” is assigned, it cannot require full-time residence in the country or countries of assignment. It could reasonably require at least part-time residence, however. The RGEs certainly suggest that they are meant to apply only to employees stationed overseas. The pre-1985 version of the RGEs was found under the heading “Regulations Governing Employees Outside the United States.” (Ex. 347, at 19 § 21.) Similarly, the conflict of interest provision in both Cooperative Agreements immediately follows a provision restricting “sale of personal property or automobiles by grantee employees ... in the foreign country to which they are assigned” and precedes a provision requiring “[t]he grantee’s employees, while in a foreign country, ... to show respect for its conventions, customs, and institutions, [and] to abide by its applicable laws and regulations.” (Ex. 15, at 62 §§ 21(b), (d).) These provisions, which surround the clause at issue here, suggest that they only apply to employees physically stationed overseas. Finally, the RGEs provide that, if an employee violates them, and the grantee determines that the employee should be terminated, “the grantee shall use its best efforts to cause the return of such employee to the United States, or point of origin, as appropriate.” (Id. § 21(g).) This provision — which can also be triggered by a decision of “the U.S. Ambassador to direct the removal from a country of any U.S. citizen” (id. § 21(f))— clearly contemplates that the employee is stationed overseas. If the phrase “assigned to” is defined as “residing in,” then the RGEs would not apply to Shleifer. Shleifer lived and was stationed in Massachusetts. He was referred to as part of the “Cambridge Staff’ as opposed to the “Field Staff.” Although Shleifer filled out Overseas Assignment Forms for work done in both Russia and Cambridge, he also filled out Local Assignment Forms for work done in Massachusetts. In December 1994, Shleifer wrote a memo to senior staff on the Russia Project stating that he was the “head of the project in Cambridge.” Nevertheless, “the foreign countries to which the individual is assigned” could reasonably refer to those countries in which there are projects to which an individual is assigned. This interpretation has the advantage of being consistent with the government’s intent in writing a conflict of interest provision in the first place: It would be quite unusual for the government wholly to exempt stateside employees from conflict of interest requirements, and to communicate this important exemption solely by a subtle interpretation of the word “assigned.” Based on that reading of “assigned to,” Shleifer would be “assigned to” Russia because of his work on the Russia Project. Because “assigned to” may reasonably be interpreted to have either one of the two meanings discussed above, I find that it is an ambiguous term. If a court determines that a contractual term is ambiguous, it may examine extrinsic evidence to resolve the ambiguity. Torres Vargas v. Santiago Cummings, 149 F.3d 29, 33 (1st Cir.1998). Summary judgment is only appropriate if “the extrinsic evidence presented about the parties’ intended meaning is so one-sided that no reasonable person could decide to the contrary.” Bank v. IBM, 145 F.3d 420, 424 (1st Cir.1998); Torres Vargas, 149 F.3d at 33. If, however, “the extrinsic evidence relevant to the interpretation of an ambiguous contractual provision is contested or contradictory, summary judgment will often be inappropriate.” Torres Vargas, 149 F.3d at 33 (internal quotation marks omitted). The parties have pointed to extrinsic evidence of USAID’s interpretation of the phrase “assigned to.” Various USAID personnel understood that to be assigned to a country meant to be “resident with the AID mission.” (See, e.g., Ballantyne 7, 9 (personnel are not “assigned” to a country even if they visit it four or five times a year for up to two weeks at a time); Ward 176 (to be “assigned in” a country means there is a standard form “assigning you there.”).) On the other hand, Orion Yean-del, a Moscow-based USAID contract officer responsible for the negotiation, formation, and administration of cooperative agreements from 1995 to 2000, interpreted the provision to prohibit “investing in the country that they are working in.” (Yean-del 221.) A 1998 e-mail from Kathleen O’Hara of USAID clarifying the Regulations Governing Employees in connection with a USAID grant to the University of Alaska stated that the RGEs apply “only to those employees who are actually working in Russia and are funded by the grant.” (Rosenberg Aff. Ex. I.) This extrinsic evidence does, not resolve the meaning of “assigned to” because it does not fully elucidate the intent of the parties at the time that they entered into the agreement. See Lanier Prof l Servs., Inc. v. Ricci, 192 F.3d 1, 4 (1st Cir.1999) (listing factors for determining parties’ contemporaneous intent). Therefore, because the term “assigned to” is ambiguous, and because neither party has provided extrinsic evidence decisively resolving the ambiguity, the issue cannot be determined on summary judgment. In sum, I find that there is sufficient dispute as to whether Shleifer was “assigned” to Russia to create a genuine issue of material fact as to whether he was covered by the RGEs. 3. Hay and Shleifer’s Investments Breached the Cooperative Agreements Having established that valid contracts exist, and that Hay, at least, was subject to the terms of those contracts, I now consider whether Hay’s investments materially violated the Cooperative Agreements so as to effect a breach of contract. As noted above, although the breach of contract claim may not ultimately turn on Shleifer’s investment activity, for the purposes of determining liability under the False Claims Act in Parts II.C, D, and E, I will also consider 'whether Shleifer’s- actions will have violated the agreements if he is found to be subject to the RGEs. The government alleges that Hay and Shleifer engaged in a variety of business and investment' activities, and that several of these investments and activities violated the RGEs. Hay and Shleifer did attempt to structure several transactions' so as to circumvent the conflict of interest provision in the RGEs, either by ensuring that money was not literally transferred within Russia, or by passing money through intermediate parties. In deciding whether these attempts were successful exploitations of legitimate loopholes or contrivances in breach of known obligations, I am mindful of the weighty purpose of the RGEs: avoiding conflicts of interest where staff with an important role in shaping the Russian economy also have a private interest in particular aspects of that economy. a. Hay’s Investments i. Russian oil stocks In the summer of 1994, Shleifer invited Hay to invest in Russian oil stocks with him. According to Hay, Shleifer told Hay that Shleifer was considering having an interest in Russian equities, and that he and his family already had an interest in the Russian gas company Gazprom, but that he was now considering other investments, including oil stocks. At a meeting in 1994, Shleifer and Hay discussed the possibility that Hay might invest in Russian equities. Hay reports that, at the meeting, Shleifer mentioned the Gazprom investment: He didn’t say that the investment in Gazprom was an investment that he made. I understood it to be an investment that he had some interest perhaps through his family or perhaps it was something that Nancy [Zimmerman] had done. It was very vague. But I understood it was something that he would benefit from in some way directly and indirectly. (Hay 24-25.) Hay agreed to make an investment in Russia. .Sometime during the summer of 1994, when Shleifer was in Moscow, Hay gave Shleifer a check for $66,000 to invest in Russian equities. Shleifer deposited the check on September 20, 1994, after he had returned from Moscow. Shleifer and Hay both contend that an investment never occurred because Shleifer never invested the money. After Shleifer deposited the check, Zimmerman told Shleifer that it was “too late” to invest Hay’s money in the oil stocks “because the prices of these stocks were much higher— or some were higher than they were at the time they Were acquired.” The next time Shleifer spoke with Hay, Hay told Shleifer he might not be interested and Shleifer told him it might be too late anyway. Several weeks or months later, Shleifer told Hay that Shleifer and Zimmerman might do something else with the money. Shleifer and Zimmerman’s bank records show that, in November 1994, an investment that used at least some of Hay’s funds was made in a Russian oil company. However, in August 1997 Shleifer returned $66,000 to Hay via Hay’s father, Dr. Robert Hay. Shleifer returned the money “because the investigation was going on and I felt that there was no way we were going to do something together investment-wise.” For the purposes of summary judgment, Hay has accepted that the investment was made. He maintains, however, that because the investment was indirect and not within Russia, it did not violate the language of the RGEs. The RGEs prohibit “engaging in” and “making loans or investments to or in any business, profession or occupation in the foreign countries to which the individual is assigned.” Hay emphasizes that the RGEs specifically prohibit employees from engaging in any business, profession or occupation “directly or indirectly, either in the individual’s own name or in the name or through an agency of another person ” (emphases added), but that the RGEs do not include the same “directly or indirectly” language in the prohibition on “making loans or investments.” Whether by mistake or by poor drafting on the government’s part, Hay argues, the provision does not include language barring indirect investments. I disagree. There is no need to reform the RGEs for them to be read to prohibit Hay’s investments in oil stocks. Investments are almost inherently “indirect” in that they require the provision of funds to, a third party for financial gain. Simply because the money here passed through an additional pair of hands — from Hay to Shleifer — does not take the investment outside the scope of the RGEs. Indeed, the clear purpose of the RGEs was to prohibit exactly this type of transaction. Under Hay’s interpretation, however, a grantee employee could “launder” an investment simply by passing it through one who acts as a broker — even if that broker is the Russia Project’s Project Director. For an investment to have been outside the scope of the RGEs, the money would have had to undergo a much less conventional route than that traveled here. I find as a matter of law that this investment by Hay violated the RGEs. ii. Flemings Russian Securities Fund Around December 1995, Hay invested some $20,000 in the Flemings Russian Securities Fund managed by Elizabeth Hebert. The fund invested only in Russian equities. With Hebert’s authorization, Hay used Hebert’s address for Fleming investment mailings because, according to Hebert, the fund required an address in the United Kingdom. Hay believes that he probably told Shleifer that he had invested $20,000 in the Flemings Russian Securities Fund; however, Shleifer does not recall whether he learned of Hay’s investment in Flemings before the USAID allegations in 1997. Hay argues that this also was an indirect investment in Russian equities by virtue of the fact that the investment took place in the United Kingdom and involved a British mutual fund. His counsel argued at the hearing on this matter that it was “[a]n investment in the U.K. where a check goes to the U.K. bank, which is what happened here, in a U.K. mutual fund. If that mutual fund then is invested in Russian equities, they’re not directly investing.” I find this argument unpersuasive. This investment constitutes an investment in a business in Russia, the foreign country to which Hay was assigned, and therefore violates the RGEs. As for Hay’s contention that the investment was indirect or otherwise so attenuated from Russia as to be beyond the scope of the RGEs, I recognize there may be investments through a mutual fund or other investment structure where the investor relinquishes control over the investment, such that the character of the funds’ investments might conceivably not be attributable to a purchaser in the funds’ shares.- However, the Flem-ings Russian Securities Fund, as its name implies, invested only in Russian securities. Hay’s investment in the Fund was plainly an investment 'in Russian business. iii. GKOs In July 1996, Hay’s father, Dr. Robert Hay, invested $50,000 of Hay’s money in Russian government debt instruments known as GKOs. Hay personally made $3,000 from the investment. The investments were made through Zimmerman’s company, Farallón Fixed Income Associates. Before the investment, Hay reviewed the conflict of interest policy in the HIID Overseas Manual and determined that it did not prohibit investment in GKOs. Hay also consulted Melinda Rishkofski, an attorney employed as a project associate on the Russia Project, regarding the GKO investment. She told Hay that the term “government savings certificates,” which she said were permissible investments under the HIID Overseas Manual, would cover GKOs. Rishkofski’s understanding at the time, however, was that HIID was not doing work related to Russian GKOs. In fact, the provision of the Overseas Manual that she relied on only exempted investment in government savings certificates “in those countries in which the work of the project itself or any of its members is unrelated in any way to national financial policies and procedures.” (Ex. 141.) To the contrary, Hay’s work was closely related to national financial policies: Hay admits to involvement in a study of the profits made by broker dealers in the government securities market, and a Legal Reform Project monthly report for USAID stated that during May 1996 the Project, “[t]ogether with the Central Bank and Arthur Andersen consultants,” developed “the framework for unit investment funds activity on GKO/OFZ (short-term state obligations and federal security bonds) market.” Regardless of whether the HIID Overseas Manual may have barred Hay’s investment of GKOs, the RGEs do not. GKOs are government debt instruments and therefore, investment in GKOs is an investment in a national government, not a “business, profession or occupation.” This is not to say that an investment in GKOs could not logically be barred by a conflict of interest provision. But the plain language of the RGE provision at issue here did not prohibit investment in GKOs. iv. Loan to Hebert In July 1996 the Russian Federal Commission for the Securities Market contracted with Forum Financial Group (“Forum”) to set up the First Russian Specialized Depository (“FRSD”). Assets invested in Russian mutual funds must be held in such depositories, which execute and record transactions as directed by management companies. Forum experienced difficulties and withdrew. In August 1996 Julia Zagaehin, an associate of Hebert’s and the manager of Oasis Financial Services (“Oasis”), sought to purchase Forum’s interest in the FRSD, but did not have the required $400,000 in capital. Around August 27, 1996 Hay’s father transferred $400,000 to Hebert. According to Hebert, she then loaned the money to Oasis for the purchase of the FRSD. Of Hay’s father’s $400,0000 loan, $200,000 was Hay’s money. His father wrote an IOU to Hay regarding Hay’s $200,000. Oasis executed a promissory note to Zagachin dated August 27,1996 for this amount. Hay testified that he did not make a loan to FRSD directly because, in part, he was “concerned about what consequences that would have for [him] in terms of [his] ability to continue working on the project.” He further testified that such a loan by him “might” violate the Harvard conflict of interest standards “depending on how it was done and how it was approved and so forth.” According to Dr. Hay, his son was aware of the loan around the time that it occurred. Hay does not recall when his father told him about the loan, but Hay did not object to his father taking the money from his account. In late December 1996 Hebert executed a promissory note to Dr. Hay for $400,000. Hay, his father and Hebert have characterized the $400,000 transaction as short term “bridge” financing to cover the time between Forum pulling out its charter capital and the FRSD finding another investor. Hebert, Zagachin, and Zimmerman understood that one of the Farallón entities was prepared to invest in the FRSD, and they needed some additional time to negotiate the terms. In April 1997 the funds were returned to Hay and his father. Zagachin has stated that at least part of the reason for the repayment of the $400,000 to Hay and his father was the commencement of the USAID investigation. Hay’s father also repaid his loan to Hay. Hay’s principal defense is that the loan was a personal loan to his father, which was in turn loaned to Hebert, which was in turn loaned to Oasis — a series of personal loans that ultimately led to a business transaction, not a loan to a business under the RGEs. I find this attempt to “launder” the money through Hay’s father and girlfriend ineffective. Hay knew that the purpose of the loan was to provide funding for the capitalization or purchase of the FRSD. Despite the subsequent effort to rewind the investment, I find this transaction violated the RGEs as they applied to Hay. b. Shleifer’s Investments I analyze Shleifer’s investments assuming arguendo that Shleifer was bound by the RGEs. See supra Part II.B.3 and note 21. i. Renova In July 1994 Shleifer signed a letter-agreeing to invest $200,000 in Russia through a company called Renova. The funds were invested in stocks of Russian companies (including the gas company Gazprom and aluminum smelter companies Irkaz, Bransk, and Sayansk) and in GKOs. Shleifer was listed as the beneficiary of these investments in August 1994. Zimmerman was identified as the beneficiary for part of 1996. At some point in 1997 a representative of Renova revised the Shleifer letter agreement to list Zimmerman instead of Shleifer as the investor. Shleifer and Zimmerman received a list of the investments made on their behalf, which included stock in various Russian companies and Russian GKOs. Harvard conceded at the hearing that it would be fair to conclude that the Renova investments were a violation of the RGEs. Shleifer conceded that it would be fair to conclude that the investments are “indirectly [Shleifer’s] investment” through Zimmerman. Based on the evidence before me, Zimmerman’s involvement in this investment does not remove it from the purview of the RGEs. To the extent that the investment included equity securities beyond GKOs, I find that the Renova investment violated the RGEs. ii. Purneftgas and Uganskneftegaz stock On August 11, 1994, $165,000 was transferred from Shleifer’s joint account with Zimmerman to a seller’s offshore bank account for the purchase of shares of Purneftgas, a Russian oil company, in the name of Howard Zimmerman, Nancy Zimmerman’s father. Twenty days later, Shleifer wrote a check for $99,000 on his Fidelity mutual fund account and sent it to Howard Zimmerman to purchase shares of the Russian oil and gas company Ugan-skneftegaz. Howard Zimmerman used the $99,000, plus some of his own money, to purchase 5,000 shares of Uganskneftegaz in his own name. These investments violated the RGEs. Although Shleifer’s money changed hands (in the United States) before being invested in the Russian companies, the evidence shows that Shleifer transferred the money for the purpose of investing in the Russian companies. Given this intent, the investments were prohibited by the RGEs. iii. Loan to Hebert Around February 25, 1997 Shleifer transferred $200,000 from a joint account with Zimmerman for the purpose of loaning the money on Zimmerman’s behalf to Elizabeth Hebert for Pallada’s use. Some of the funds were wired directly to Pallada’s landlord at Hebert and Zimmerman’s request. Shleifer concedes that he understood the purpose of the loan to Hebert was for Pallada. According to a promissory note, the money given to Hebert for Pallada was secured by all of Hebert’s assets, which included stock in Boston Capital Management, the holding company that owned Pallada. The loan document was executed after the February transfer of funds, but neither Zimmerman nor Hebert can recall when it was signed. This again appears to be an investment in violation of the RGEs. Here Shleifer provided funds to Hebert for the purpose of funding her business, a mutual fund management company doing business in Russia. 5. Disposition For the reasons discussed above, I find that Hay made investments that breached the Cooperative Agreements between Harvard and USAID. Consequently, I will grant the government’s motion for summary judgment on Count VI, and deny Harvard’s motion for summary judgment on the same count. C. Count I: False Claims Act, 31 U.S.C. § 3729(a)(1) A person is liable under section 3729(a)(1) of the False Claims Act if he or she: “knowingly presents, or causes to be presented, to an officer or employee of the United States Government ... a false or fraudulent claim for payment or approval.” 31 U.S.C. § 3729(a)(1). 1. Claims for Payment Presented to An Officer of the Government A “claim” includes “any request or demand, whether under a contract or otherwise, for money or property.” 31 U.S.C. § 3729(c). In deciding whether a statement is a claim or demand for payment, “a court should look to see if, within the payment scheme, the statement has the practical purpose and effect, and poses the attendant risk, of inducing wrongful payment.” United States v. Rivera, 55 F.3d 703, 710 (1st Cir.1995). The term should be construed broadly to reach “all fraudulent attempts to cause the Government to pay out sums of money.” United States v. Neifert-White Co., 390 U.S. 228, 233, 88 S.Ct. 959, 19 L.Ed.2d 1061 (1968). The USAID payment scheme involved submission of FCTRs, FSRs, a