Has someone posted a transcript of the ATC transmissions or a link to one? Without that you can't know what the pilot said to ATC and thus cannot know that he lied.
Here are a couple of paragraphs from the "Steamboat Pilot & Today" article:
"Airport Manager Dave Ruppel confirmed Merrill’s account on Monday. According to Ruppel, one of the United pilots told air traffic controllers in Denver, 'I’m on the deck.' The Denver officials then cleared the private plane to take off, Ruppel said, thinking the United flight was on the ground."
"Ruppel said the United pilot told air traffic controllers in Denver that he was canceling 'instrument flight rules.' Instrument flight rules, or IFR, are a set of rules for flying by aircraft instruments only, while separation from other aircraft is provided by air traffic control. The rules allow for such things as flying through clouds. When a pilot cancels IFR, he then operates under 'visual flight rules,' and is responsible for navigation, obstacle clearance and traffic separation."
The only quote attributed to the United flight is "I’m on the deck." What does that mean? You won't find it in the Pilot/Controller Glossary. "On the deck" is an old aviation slang term, it means "ground level or very close to the ground." If that's all that was said to ATC, if the controller concluded United was canceling IFR based on that phrase, upon which he issued an IFR release to the King Air, then he's got himself a separation error. If that phrase is the basis for the assertion that the United crew lied to ATC, saying they were on the ground when they were not, then that assertion is unfounded.
Based on the SP&T article, the worst that can be said about the United pilot is that he used sloppy phraseology. Sloppy phraseology is bad, but it does not constitute lying to ATC.