Document: 538 U.S. 119 COOK COUNTY, ILLINOISv.UNITED STATES EX REL. CHANDLER. No. 01-1572. Supreme Court of United States. Argued January 14, 2003. Decided March 10, Under the False Claims Act (FCA), "[a]ny person" who, inter alia, "knowingly presents, or causes to be presented, an officer employee States Government ... a false fraudulent claim for payment approval," 31 U. S. C. § 3729(a)(1), is liable civil penalty, treble damages, and costs, 3729(a). Although Attorney General may sue under FCA, private person, known as relator, also bring qui tam action "in name Government." 3730(b). The relator must inform Justice Department her intentions keep pleadings seal while decides whether intervene do its own litigating. 3730(b)(2). If succeeds, relator's share up 30 percent proceeds action, plus reasonable expenses, attorney's fees. 3730(d). This case involves National Institute Drug Abuse research grant Cook County Hospital study that was later administered by nonprofit institute affiliated with hospital. Respondent Chandler, who ran institute, filed this claiming (hereinafter County) had submitted statements obtain funds in violation 3729(a)(1). After held Vermont Agency Natural Resources v. ex rel. Stevens, 529 765, are not "persons" subject FCA actions, District granted County's motion dismiss claims against it. court County, like State, could subjected which Stevens described "essentially punitive," id., at 784. Seventh Circuit distinguished reversed. Held: Local governments amenable actions FCA. Pp. 125-134. (a) While 3729 does define term "person," meaning has remained unchanged since original passed 1863. supra, 783, n. 12. There no doubt then extended corporations. Indeed, early 1826 Amedy, 11 Wheat. 392, 412, recognized presumption "person" includes "persons politic incorporate." Essentially conceding corporations were taken persons when 1863, argues municipal so understood until six years later, decided Cowles Mercer 7 Wall. 118. Cowles, however, extension principle but natural recognition common understanding ones treated alike terms their legal status capable suing being sued. explains how conclude "automatically without discussion" corporations, ones, "should virtually all purposes constitutional statutory analysis." Monell New York City Dept. Social Servs., 436 658, 687-688. Of course, only presumptive one, neither history nor text provides contextual evidence Congress intended exclude municipalities from class covered 125-129. (b) Amendments 1986 did repeal liability. As part effort modernize amendments raised ceiling on damages recoverable 3729(a) double treble. Relying law punitive municipalities, see Newport Fact Concerts, Inc., 453 247, 259-260, 21, Court's statement 784, 785, change turned what been "remedial" provision into punitive" that, even if 1863 1986, Congress's adoption "punitive" remedy entailed elimination liability 1986. It follow feature force show congressional intent implicitly existing definition "person." To begin with, FCA's multiplier compensatory function well one. Most obviously, statute's means much Government's recovery go began action. Even there paid, beyond actual necessary full recovery, separate prejudgment interest consequential damages. remedy's nature arguing robust it would pure penalty cases. What more, certainly equate classic leaves jury open-ended discretion over amount, raises two concerns specific defendants: local government's taxing power will make easy target unduly generous blameless unknowing taxpayers unfairly taxed wrongdoing officials. Neither these serious thus brings limited vigor aid. Working position, different presumption, one strength: "cardinal rule repeals implication favored." Posadas Bank, 296 497, 503. Inferring increase triple difficult abstract, impossible given basic purpose more useful tool fraud modern times. Whether true now often administer receive federal funds. simply plausible sub silentio very strengthen hand fighting claims. 129-134. 277 F. 3d 969, affirmed. SOUTER, J., delivered opinion unanimous Court. 1 CERTIORARI TO THE UNITED COURT OF APPEALS FOR SEVENTH CIRCUIT. 2 Donna M. Lach argued cause petitioner. With briefs Richard A. Devine, Patrick T. Driscoll, Jr., Sanjay Tailor, Jerold Solovy, Barry Sullivan. 3 Judson H. Miner respondent. him brief George Galland, Charlotte Crane. 4 Malcolm L. Stewart amicus curiae urging affirmance. Solicitor Olson, Assistant McCallum, Deputy Clement, Douglas N. Letter, Michael E. Robinson.* 5 JUSTICE SOUTER 6 In 765 (2000), we §§ 3729-3733. Here, question such suits, hold they are. * 768-770, some detail currently penalties (so far us here) approval." brought Government," hope sharing any recovery. 60 days 3730(b)(2); 3730(c). defendant between $5,000 $10,000 each violation, (reducible cooperative defendants), costs. 3729(a).1 "proceeds settlement" percent, depending intervened and, so, contributed prosecution claim. 3730(d).2 get Ibid. 8 allegedly occurred administering $5 million Hospital, owned operated implies, object studying treatment regimen pregnant drug addicts. variety conditions, including compliance plan meant assure jibe regulations human subjects. Administration transferred Hektoen Medical Research, organization Respondent, Dr. Janet September 1993 fired 1995. 9 1997, Chandler 3729(a)(1).3 said defendants violated grant's express failed comply human-subject research, reports she called "ghost" alleged reporting doctors hospital granting agency, rendering dismissal both state whistle-blower 3730(h).4 declined 10 moved it, arguing, among other things, FCA.5 denied motion, reading include governments. 35 Supp. 2d 1078 (ND Ill. 1999). Appeals dismissed interlocutory appeal, certiorari. 528 931 (1999). came down, reconsidered Chandler's found "no reason alter conclusion `person' FCA," punitive." 118 902, 903 (2000). Appeals, conflict Circuits,6 reversed, 969 (CA7 2002). We certiorari, 536 956 (2002), affirm Appeals. II have S., having expressly "`extends incorporate, whatsoever.'" 412 (1826) (quoting Coke, Second Part Institutes Laws England 736 (1787 ed.) (reprinted 5B Historical Writings Law Jurisprudence (1986)); Wheat., ("That are, law, purposes, deemed persons, unquestionable"); accord, Beaston Farmers' Bank Del., 12 Pet. 102, 135 (1838); Trustees Dartmouth College Woodward, 518, 667 (1819) (opinion Story, J.) (A corporation "is, short, artificial contemplation endowed certain powers franchises which, though exercised through medium members, yet considered subsisting itself, distinctly real personage"). position accorded contemporary commentators general enjoyment capacity See, e. g., J. Bouvier, A Dictionary 332 (6th ed. 1856) (def. 2: "is used denote person"); Kyd, Treatise Corporations 13 (1793) ("A CORPORATION then, body politic, collection many individuals, united body, vested, policy acting, several respects, individual, particularly taking property, contracting obligations, sued ..."). Chief Marshall's Deveaux, Cranch 61, 86-87 (1809), rely issue "citizen" diversity jurisdiction, 1844 Deveaux abandoned citizenship independent constituent members virtue "a although person." Louisville, & R. Co. Letson, How. 558 (1844); Burrill, Glossary 383 (2d 1859) declared inhabitant state, citizen, sued"). (1869), applied Letson them. going back least species "body corporate," W. Glover, Practical Municipal 41 (1837) (Municipal have, attribute "necessarily inseparably incident every corporation," ability "[t]o sued, acts may"); Dillon, 92 (rev. 1873). "[t]he archetypal American eighteenth century [was] municipality"; 19th become widespread. Horwitz, Transformation Law, 1780-1860, p. 112 (1977). 687-688 (1978); 121 (describing "presents little difficulty").7 usual immutable, Monell, 688, asks take cue qualification included Act, Feb. 25, 1871, 2, 16 Stat. 431, "the word extend bodies corporate unless context shows [it was] sense." Cf. Angell Ames, Private Aggregate 1846) ("The construction is, `persons' mentioned statute, fall within design statute"). invokes points takes indicating meaning. 14 First, says "inherently inconsistent governmental liability," Brief Petitioner 13, owing references enactment "any person land naval forces States" military States," together imposing criminal liability, imprisonment, latter category, Mar. ch. 67, 1, 3, 696, 697, 698.8 But old merely forces" directed persons. second phrase, covering "persons," limited, outside coverage, espouses seriously doubted 782. reference short answer regarded anomalous require substantive standards laws impose [both criminal] sanctions upon `persons.'" Lafayette Louisiana Power Light Co., 435 389, 400 (1978). Municipalities susceptible exempt them remedies sensibly apply. Id., 400-401; Union Supply 215 50, 54-55 (1909). 15 cited recounted primary concern "`stopping massive frauds perpetrated large [private] contractors during Civil War.'" 781 Bornstein, 423 303, 309 (1976), adding "[private]"). governments, says, players game war profiteering stop. true, way affect fact wrote expansively, "to reach types fraud, qualification, might result financial loss Neifert-White 390 228, 232 (1968). Whatever doing 2003 commonly receiving end sorts funding schemes less able than individuals fisc exploit exercise spending power. 685-686 (noting can, "equally create harms remedied [by 42 1983]"). sum, exclusion III Nor application statute affected alternative based evolution provisions relief. argument leads off, least, sound premise about historical tension imposed punishment. established "that municipality, corporation, suit wide range tortious activity, award exemplary damages," 259-260 (1981). Since municipalities' resistance still obtains, today allowed authorized statute." 260, 21. 17 relies asking infer remarkable consequence unstated fine $2,000 current $10,000, Pub. 99-562, 2(7), 100 3153. spoke turning 785. characterization argue 18 indeed find character read word, municipalities. important realize side, serving remedial addition objectives. Mitsubishi Motors Corp. Soler Chrysler-Plymouth, 473 614, 635-636 (1985) (citing Brunswick Pueblo Bowl-O-Mat, 429 477, 485-486 (1977)); Soc. Mechanical Engineers, Inc. Hydrolevel Corp., 456 556, 575 (1982); Holding Malley-Duff Associates, 483 143, 151 (1987). tipping point payback punishment defies formulation, dependent workings particular course litigation, facts traits along punitive. 19 amount usually "necessary compensate completely delays, inconveniences occasioned claims." 315; Halper, 490 435, 445 (1989) injury "not ancillary costs detection investigation, routinely attend efforts root out deceptive practices public purse"). most obvious indication place possibility diverting cases rough difference serve punish, quicken self-interest plaintiff can spot violations start litigating Government, benefiting himself well. See Marcus Hess, 317 537, 547 (1943). remaining provide elements make-whole mere recoupment fraud. 315, 11. paid. interest, thought essential compensation, see, Kansas Colorado, 533 10-11 (2001), substantial long limitations, 3731(b). typically come Restatement (Second) Torts 549(1)(b), Comment d (1976).9 20 Thus, exceed compensation good cases, Treble leave defendants. One makes jury. Newport, 270-271. open temptation; finds instruction return verdict alone determines multiplier, just sets penalty. 3729(a); 3d, 978. mitigation, also, worry, "blameless taxpayers" 267. expose already enjoyed indirect benefit extent money lower taxes expanded services. ibid. taxpayer should undeserved benefit, permanently pocket, answered case, opportunistic combination judge's settle 3730(c)(2). 21 503 (1936). legislative silence hazardous best, error seems overwhelmingly likely notion wordlessly redefined argument, remembered, bypass corporations; amendment eliminate coverage entirely, after century. hard consider 22 "more times." Rep., 2. Because concerned pervasive "all programs," ibid., parties information possession, Hughes Aircraft Schumer, 520 939, 946 (1997); increased measure recovery; enhanced incentives relators suit. Yet urges made funds, immune whatsoever done sense suggest breath.10 Burns States, 501 129, 136 (1991).11 IV 23 nothing judgment 24 Affirmed. Notes: Briefs ofamici reversal et al. Cardozo, Leonard Koerner, Gail Rubin, Merita Hopkins, Scott Chinn, Grant Langley; Orange, California, Walter Dellinger, Jonathan D. Hacker, James Asperger; 43 Governmental Airport Proprietors P. Lewis; Association Counties Ruda, Robert K. Huffman, Miriam Nemetz, Charles Rothfeld, Bronston; Public Hospitals Health Systems Luband; Texas School Boards Legal Assistance Fund William Boyce Warren Huang. amici affirmance K R Limited Partnership Carl Coan Regina Poserina; Taxpayers Against Fraud, Center, Cooper, Brian Stuart Koukoutchos, Moorman. Dignazio Francis X. Crowley Delaware, Pennsylvania. adjusted upward inflation Federal Penalties Inflation Adjustment 1990, 101-410, 5, 104 891, note following 28 2461. $5,500 $11,000. CFR 85.3(a)(9) (2002) intervene, entitled 25 proceeds. 3730(d)(2). chooses "shall settlement claim, substantially action." 3730(d)(1). If, "based primarily disclosures (other provided bringing action) relating allegations transactions criminal, civil, administrative hearing, congressional, administrative, Accounting Office report, audit, news media, sums considers appropriate, proceeds...."Ibid. (footnote omitted). originally identity County. 971, 2002) retaliation because employerUnited 1078, 1087 dismiss, grounds; denial before us. Dunleavy 279 219 (CA3 2002); Garibaldi Orleans Parish Bd., 244 486 (CA5 2001). supportingamici urge further distinction full-fledged towns cities, incorporated request inhabitants, "quasi corporations" counties, unilateral creations State. Barnes Columbia, 91 540, 552 (1876). quasi differed equally "persons." itself Illinois county bifurcated 1878, seeRainwater 356 590, 592, (1958), recodified 287. was, way, adopted substitute Senate version bill proposed top House Rep. 99-345, 39 (1986) Rep.); 99-660, (1986). Ultimately, Senate's figure dropped affirmatively endorsed amendments. broad partnerships, associations, political subdivisions thereof" (citing,inter 658 (1978))). insufficient overcome background present belies contrary applicable remove implied why subsidiary arguments cannot succeed here, despite gave credence inStevens. contrasts Investigative Demand enacted amendments, 3733, 783-784, 3733 confirm earlier 3729, State; presumptively municipality sensible Program Fraud Remedies (PFCRA), 99-509, 1934 (codified 3801 seq.), "designed operate tandem FCA." 786, 17. PFCRA prohibits same conduct specifically defines partnership, association, organization." 3801(a)(6). assuming correct "corporation," hardly weighty separately statute.

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