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Gabelli agrees to settle False Claims Act suit

Mario Gabelli, the money manager, has agreed to settle charges that he defrauded the federal government by using sham companies to bid for cellular phone licenses. The terms of the settlement will not be publicly disclosed until June 29th, when they will be filed with the court.

Gabelli bankrolled sham startup companies in order to bid on Federal Communications Commission licenses that were set aside for small businesses. The Wall Street Journal story speculated that the settlement will include a payment of more that $100 million to the federal government.

The relator who originally brought the suit under the qui tam provisions of the False Claims Act was Rufus Taylor III. Mr. Taylor was represented by the law firms of Phillips & Cohen and Williams & Connelly.

Bloomberg reported on the settlement on June 6, 2006. Additional information, with cites to a variety of news reports, is available at the Phillips & Cohen website.

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