Lance Armstrong will pay the United States $5 million to settle claims the cycling legend defrauded the federal government by using performance-enhancing drugs while collecting millions from a sponsorship deal with the U.S. Postal Service, the U.S. Department of Justice said Thursday.
The government was seeking $100 million in damages from Mr. Armstrong, who was stripped of record seven Tour de France victories after he admitted to using performance-enhancing drugs (PEDs) throughout his career.
In a lawsuit, the government accused Mr. Armstrong of misleading the Postal Service and public when he denied using PEDs, according to the Justice Department. That denial factored into the Postal Service’s decision to continue sponsoring Mr. Armstrong and his team in 2000, the Justice Department said.
The 2000 pact was at a higher rate than the previous sponsorship deal with more money going to Mr. Armstrong, according to the Justice Department. All told, the Postal Service paid $31 million in sponsorship fees to Mr. Armstrong’s team between 2001 and 2004. Mr. Armstrong collected about $13.5 million of that total.
A settlement spares both sides from a trial that was scheduled to start May 7 in Washington.
Mr. Armstrong issued a statement to the Associated Press saying he was spending “a lot of money” to resolve the lawsuit, which called “meritless and unfair.”
“I rode my heart out for the Postal cycling team, and was always especially proud to wear the red, white and blue eagle on my chest when competing in the Tour de France. Those memories are very real and mean a lot to me,” he said.
Chad Reader, acting assistant attorney general for the Justice Department’s Civil Division, differed.
“No one is above the law,” Mr. Reader said in a statement. “A competitor who intentionally uses illegal PEDs not only deceives fellow competitors and fans, but also sponsors, who help make sporting competitions possible. This settlement demonstrates that those who cheat the government will be held accountable.”
The Justice Department joined a civil suit against Mr. Armstrong in 2013 alleging he breached his contract with the Postal Service for using banned substances. It was filed shortly after Mr. Armstrong admitted to Oprah Winfrey that he used PEDs.
Mr. Armstrong’s cheating was revealed in 2012, when the U.S. Anti-Doping Agency stripped his titles. That was after former teammate Floyd Landis sued Mr. Armstrong under the False Claims Act. Mr. Landis alleged that had defrauded the government by using PEDs during his Postal Service sponsorship. As the person who first filed a lawsuit, Mr. Landis is eligible for up to 25 percent of the settlement, which includes $1.65 million paid to his attorneys, the Justice Department said.