Allison Engine Co., Inc. v. United States
In Allison Engine Co., Inc. v. United States, 128 S. Ct. 2123, 170 L. Ed. 2d 1030, 2008 WL 2329722 (U.S., 2008), the United States Government argued that it is customary to say that the Government pays a bill when a person or entity receives Government funds and subsequently uses those funds to pay a bill or expense. Id.
The United States Supreme Court, however, found the Government's assertion unpersuasive, stating that the Government's argument involved a "colloquial usage of the phrase 'paid by' that is not customarily employed in more formal contexts." Id.
The Supreme Court further expounded upon its reasoning by providing that, "if a federal employee who receives all of his income from the government were asked in a formal inquiry to reveal who paid for . . . his new car or a vacation, the employee would not state that the federal government had footed the bill." Id.
The essential principle articulated by the United States Supreme Court in Allison Engine was that the definition of "government" or "public" funds has limitations once the funds are transferred from the government to an employee or private entity.