False Claims Act
The federal False Claims Act authorizes a private individual, known as a “relator,” to bring a cause of action on behalf of the government to recover money lost due to fraud or other misconduct. A lawsuit filed under the False Claims Act is known as a qui tam action, a legal concept that first originated in England. A qui tam action allows an individual to sue on behalf of the government and receive a percentage of the recovery.
Whistleblower lawsuits help our government recover billions every year. The government rewards successful whistleblowers for bringing fraud to their attention.
In fiscal year 2017, the Department of Justice recovered over $3.7 billion from False Claims Act cases. Of the $3.7 billion in settlements and judgments, $3.4 billion was related to lawsuits filed under the qui tam provisions of the False Claims Act. During the same period, the government paid out $392 million to the individuals who exposed fraud and false claims by filing a qui tam complaint.
If you have evidence of a fraud against the government, contact one of our False Claims Act attorneys.
Filing a Complaint Under the False Claims Act
A complaint is filed under seal in an appropriate federal district court. The Department of Justice is notified and investigates the allegations in the complaint. If the Department of Justice decides to intervene in the case, they will prepare and file their own complaint. If they decline, you are entitled to proceed with the litigation on behalf of the government. There are certain situations when a relator is not entitled to bring a lawsuit. An attorney at McEldrew Young can help determine whether one of these exceptions applies to you.
- Criminal Conduct – A relator is barred from bringing suit under the False Claims Act if he or she has been criminally convicted for their role in the misconduct at issue.
- First to File Bar – A whistleblower cannot proceed with qui tam litigation if another relator has already filed a complaint concerning the fraud. The lawsuit also cannot proceed if a government civil or administrative monetary proceeding has been filed.
- Public Disclosure Bar – A False Claims Act lawsuit cannot be based upon information already disclosed to the public unless the relator is the original source of the information.
The federal False Claims Act offers protection from employer retaliation when a whistleblower brings a qui tam lawsuit. Section 3730(h) of the False Claims Act prohibits adverse changes to the terms and conditions of employment as a result of lawful whistleblowing activities to stop violations of the False Claims Act. If an employee is subjected to discriminatory action as a result of their whistleblower status, he or she is entitled to bring a cause of action in federal district court for double back pay, interest, and compensation for special damages (e.g. litigation costs and attorneys’ fees). The anti-retaliation provisions of the False Claims Act protect whistleblowers for three years from the date of retaliation. Other laws, including state and local false claims act laws, may provide additional anti-retaliation protections for the relator bringing a qui tam complaint.
Confidentiality Under the False Claims Act
A lawsuit under the federal False Claims Act begins with a complaint filed under seal. This procedure prevents public disclosure of the lawsuit and allows the government to investigate the allegations of fraud before the defendant becomes aware of the action. During this period, the identity of the whistleblower is known only to government investigators and, in some cases, the court. The whistleblower must maintain strict confidentiality regarding the lawsuit. After the government has investigated and decided whether it will intervene in the case, the lawsuit is unsealed and the identity of the whistleblower becomes public knowledge in most cases. If you would like to report any of the following, contact our team of lawyers at McEldrew Young today: