What happens if the government declines a case under the False Claims Act?

The False Claims Act gives the federal government the option to intervene and prosecute your information on its own.  If the Department of Justice decides not to proceed against the company with your information, the lawsuit is not over.  The whistleblower and their attorney are able to proceed with the case on behalf of the government.  If you decide to continue, your relator share goes up. In non-intervened cases, the relator is entitled to between 25 and 30 percent of the money recovered for the government instead of the usual 15 to 25 percent.

Many cases where the government has declined to intervene have still been successful.  Since October 2009, relators have earned more than $100 million where the U.S. declined.  The problem is that the likelihood of success is much lower than if government-backed. Only about 20 percent of qui tam lawsuits lead to a settlement or favorable trial verdict when the government declines.

Trinity Lawsuit

In 2014, whistleblower Josh Harman received a $175 million verdict at trial without the involvement of the U.S. Government.  If the verdict is tripled, Harman could be entitled to over $125 million as a reward.

[vc_accordion style=”accordion”][vc_accordion_tab title=”Frequently Asked Questions”]

Here are a few of the questions that we are frequently asked about this aspect of the process:

[/vc_accordion_tab][vc_accordion_tab title=”If the Government declined, does that mean I don’t have a case?”]

Absolutely not.  The government may decide not to proceed against a company for a variety of reasons. They do not all have to do with the merits of the case. Sometimes, it is simply a decision to spend the government’s limited resources elsewhere.  Declined cases have been continued by the attorneys for the relator and led to substantial recoveries for the government and the relator.

[/vc_accordion_tab][vc_accordion_tab title=”Can the Government change their mind?”]

Yes.  The government continues to be a party in interest to the litigation.  There have been a handful of cases where the government initially declines but later intervenes after additional facts come to light in discovery.  Even without intervention, the government may still file briefs to the court when important issues arise.

[/vc_accordion_tab][vc_accordion_tab title=”Does my name stay confidential?”]

No.  After the government makes a decision on intervention and notifies the court, the judge will lift the seal.  When this happens, you can discuss the case with reporters and your friends.  Of course, you will want to keep any communications between you and your lawyer private in order to maintain the protections of attorney-client privilege.

[/vc_accordion_tab][vc_accordion_tab title=”Do you have to continue the lawsuit?”]

No.  You are not required to pursue the company on your own if the government isn’t interested.  The complaint can be voluntarily dismissed without prejudice.

[/vc_accordion_tab][vc_accordion_tab title=”If you don’t wish to pursue the case on your own, can you keep your name private?”]

When the government declines, the complaint is unsealed and you are free to pursue the company in litigation on behalf of the government.  Your name and the lawsuit becomes a part of the public record and the company will know who reported them to the Department of Justice.  If you are going to dismiss your lawsuit, you can ask the court to maintain the seal.  The judge is not obligated to grant your motion but it is within their power to do so if they decide to exercise discretion.  The success of these motions have varied and it is not possible to guarantee continued confidentiality.

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