People send us things to consider discussing in our posts. Usually, those things are court decisions in drug and device cases. Sometimes, they are so far afield from our comfort zone that we do not give them much consideration. This week, we received a motion from a False Claims Act case that we thought was interesting enough to enlist a colleague to add some subject matter expertise while we fretted about the election, work, the election, and some other stuff (i.e., the election). Much of the credit for this post goes to Andy Bernasconi, a fine lawyer for a crazy Red Sox and Patriots fan.
While we do dabble in the FCA on this blog, we lean on Andy for a quick primer on the FCA’s provisions. Congress originally passed the FCA in 1863 as a way to deter and punish government contractors’ fraud against the U.S. and Union troops during the Civil War. The statute (as amended) generally creates liability for any person who knowingly submits a materially false claim demanding payment from the United States. See 31 U.S.C. § 3729(a)(1). An FCA violation is punishable by treble damages, civil penalties of up to $21,563 for each false claim, and an award of attorneys’ fees. Id. §§ 3729(a)(1) &(3); id. § 3730(d)(1); 81 Fed. Reg. 42491 (June 30, 2016).
One of the most notable aspects of the FCA is that it contains unique qui tam provisions that permit a private whistleblower, also known as a “relator,” to file FCA claims on behalf of the federal government. Id. § 3730(b)(1). In doing so, the relator files the case under seal, at which point the Justice Department investigates the allegations and decides whether the government will intervene and take over the case to litigate for itself. Id. §§ 3730(b)(2), (4). If the government declines to intervene in the case, the relator may litigate the case in the name of, and on behalf of, the government. Id. § 3730(c)(3).