The United States permits qui tam lawsuits under the False Claims Act. Think of qui tam lawsuits as a cousin of class action lawsuits — but instead of representing a class of plaintiffs qui tam lawsuits represent the whole of the U.S. government.
In 13th century England, lawsuits were authorized on behalf of the king to enforce English laws. Qui tam provisions were also popular in colonial America and in the early United States. It provided a mechanism to enforce the law when there were few law enforcement officers. They mostly fell out of favor in the modern-day U.S., but are still used in the whistleblower context.
What Is a Qui Tam Lawsuit?
Merriam Webster’s Dictionary defines ‘qui tam’ as “an action to recover a penalty under a statute that gives part of the penalty to the one bringing the action and the rest to the state or a public body.”
The word is short for a longer Latin phrase, qui tam pro domino rege quam pro se ipso in hac parte sequitur. It means, “[He] who sues in this matter for the king as well as for himself.”
Who Can File a Qui Tam Lawsuit?
When an individual files a complaint against a party in a court of law, the plaintiff must have the standing to sue. The court normally does not allow one individual to sue on behalf of another individual unless it is a parent or guardian suing on behalf of their child.
The False Claims Act compels courts to allow a relator, as the individual is known under the law, to bring the lawsuit in the name of the United States. The law sought to create a public-private partnership between whistleblowers and the U.S. Government.
In cases where the U.S., for whatever reason, does not want to expend its resources in pursuit of compensation, the law allows the relator to do so. If the individual recovers, the U.S. recovers most of the proceeds from the litigation and the plaintiff-relator is entitled to a share (between 25 and 30 percent when the Justice Department declines to intervene).
When Can You File a Qui Tam Lawsuit?
The SEC, CFTC and IRS whistleblower programs rely solely on the government to bring an enforcement action against corporate wrongdoing violating federal law. However, there have been calls to allow qui tam actions to enforce the nation’s tax laws as well. The False Claims Act specifically excludes that category of cases against the government.
The False Claims Act is not the only law that contains a provision allowing individuals to sue on behalf of the government. In the following situations, people may also file qui tam lawsuits:
- Healthcare fraud
- Government contract fraud
- Violations of Indian protection laws
- The removal of undersea treasure from the Florida coast to foreign nations
- Arming vessels against our allies
What Are Some Examples of a Violation of the False Claims Act?
In the healthcare industry, False Claims Act violations often include improper billing for medical services, such as:
- Upcoding – Submitting a claim for payment to the government using a billing code for a more expensive service or procedure than what was actually performed on the patient.
- Unbundling – Billing for a number of separate medical procedures that comprise a single procedure that is normally billed as a single charge.
Drug manufacturers can fall afoul of the False Claims Act for a variety of violations related to:
- Price reporting
Procurement fraud in government contracts can occur during all phases of contracting, from pre-award to final completion. One of the most notable violations is:
- Bid rigging – Any conduct that interferes with the competitive bidding process. In its simplest form, bid-rigging is a conspiracy among bidders to decide which company will submit the winning bid.
Our Qui Tam Settlement Successes
Our lawyers achieved what was at the time the largest qui tam settlement in U.S. history against pharma giant Pfizer — over $2 billion dollars in criminal and civil fines, penalties, and damages for defrauding Medicare, Medicaid, and other government-funded healthcare programs in connection with its market practices for four of its drugs.
In November 2020, our co-founder Eric L. Young was honored as one of two “Lawyers of the Year” by the Taxpayers Against Fraud Education Fund. This recognition was in honor of Young’s part in two successful qui tam False Claims Act cases against two more of the nation’s top drug manufacturers — Novartis and Teva.
Our other notable qui tam successes include:
- U.S. ex. rel. Peiken v. Salix (Valeant) — a $54 million qui tam False Claims Act settlement against Valeant Pharmaceuticals arising out of allegations of the payment of kickbacks through sham speaker programs.
- U.S. ex. rel. Mihalovic v. ECL Solutions — criminal penalties imposed by the U.S. Department of Justice as a result of McEldrew Young Purtell Merritt qui tam False Claims Act case.
- U.S. ex. rel. Curren v. Denver Health Hospital — a $6.3 million qui tam False Claims Act settlement alleging the submission of false claims to Medicare and Medicaid.
- U.S. ex. rel. Paccione v. Cephalon — $425 Million in a civil settlement in a qui tam False Claims Act case. At the time, this was the largest biotechnology Medicaid fraud case in U.S. history.
When to Consult with an Experienced Qui Tam Law Attorney
The qui tam attorneys at McEldrew Young Purtell Merritt regularly evaluate the eligibility of informants for rewards under whistleblower programs. Our attorneys also provide a comprehensive assessment of the sufficiency of the evidence supporting a whistleblower claim.
There are many pitfalls that could prevent you from receiving compensation even if your information leads to monetary recovery. If you have information involving a violation of federal laws, contact McEldrew Young Purtell Merritt first for a free, no-obligation confidential consultation.