Source: https://www.baumhedlundlaw.com/whistleblower-claims/whistleblower-laws/false-claims-act/
Timestamp: 2018-12-10 22:38:21
Document Index: 126259743

Matched Legal Cases: ['§3', '§9', '§10', '§4', '§4', '§10104', '§1079']

Federal False Claims Act Baum Hedlund 2017-02-06T13:56:58+00:00
The United States government loses billions of dollars each year to fraud and abuse. The False Claims Act (FCA) is designed to hold individuals and organizations that cheat the government accountable and to recover the money they stole. Under the FCA, parties who submit false claims and commit fraud against the federal government (excluding tax fraud) are liable to pay triple the government’s damages, plus civil penalties ranging from $5,500 to $11,000 per false claim.
The FCA, also called the Whistleblower Act, encourages citizens who have evidence of fraud against the government to contact a False Claims Act attorney and sue on the government’s behalf. Such lawsuits are known as qui tam lawsuits (see FCA history below) and the whistleblower is referred to as the “relator.” Under the qui tam provisions of the FCA, when the government joins a qui tam case, the relator is entitled to a reward of 15 percent to 25 percent of the money recovered by the government. If the United States does not join the qui tam lawsuit, the whistleblower may still pursue the legal action unilaterally and receive a reward of 25 percent to 30 percent of a successful recovery.
Many states have false claims acts modeled on the federal statute. These state statutes also allow a citizen file a qui tam lawsuit and bring whistleblower claims against companies and individuals cheating the state. These state qui tam statues also reward whistleblowers for providing information that leads to the recovery of state funds.
The False Claims Act is a complex statute and it is critical that relators work with an experienced False Claims Act attorney to pursue their whistleblower claims. The FCA may be violated in several ways which include: overcharging for a product, providing a defective product, billing for a service that is not performed, delivering less than the promised amount of goods or services, underpaying money owed to the government, and charging for one thing but delivering another. A false claim is legally defined in section 3729 of the Act.
The False Claims Act also has provisions that protect whistleblowers who suffer retaliation by their employers for reporting the fraudulent conduct.
A separate federal whistleblower act, known as the Whistleblower Protection Act, provides federal government employees with certain rights in the event their employers retaliate against them for making disclosures regarding illegal or improper government activities.
The False Claims Act History
As the Latin phrase “qui tam” suggests, governments have relied upon the people for the prevention of crimes against the state for centuries. Qui tam is short for the phrase “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” which means “who pursues this action on our lord the king’s behalf as well as on his own,” and indeed, beginning in 13th century England, qui tam actions were employed to enforce the laws of the crown.
The first whistleblower law in United States history was passed by the Continental Congress on July 30, 1778. As related by Steven Kohn in his book, The Whistleblower’s Handbook: A Step-by-Step Guide to Doing What’s Right and Protecting Yourself, the law called upon “all persons in the service of the United States, as well as all other inhabitants thereof, to give the earliest information to Congress or any other proper authority of any misconduct, frauds, or misdemeanors committed by any persons in the service of these states, which may come to their knowledge.”
In passing the law, Kohn writes, the members of the Congress were responding in support of ten Revolutionary War sailors and marines who had petitioned them to have the commander of the Continental Navy, Commodore Esek Hopkins, removed from his post for torturing British soldiers. Hopkins had retaliated against the whistleblowers by filing a criminal libel suit, but Congressional action insured the petitioners were protected and Hopkins was removed from command.
In 1863, President Lincoln enacted the False Claims Act in an effort to stop war profiteers from defrauding the Union during the Civil War. Although the Act was successful in deterring fraud against the Union, the law was virtually unused after the war ended. A 1943 amendment to the Act, as interpreted by the courts, had the unfortunate effect of making it much more difficult for a citizen to file a successful qui tam lawsuit.
By the 1980s, Congress estimated that the U.S. government was losing tens of billions of dollars in undetected fraud schemes, many of them perpetrated by Department of Defense contractors. The government became concerned that most of these fraudulent claims were almost impossible to detect. As a result, in 1986 Congress again amended the FCA, this time strengthening its qui tam provisions in a way that permitted private citizens to once again become a key resource for the government in detecting fraud. Amendments to the law in 2009 and 2010 further strengthened it.
Today the FCA serves as an enormously effective fraud fighting tool which has enabled the government to recover billions of dollars. Citizens who come forward to report their knowledge of fraud are rewarded with a share of the money recovered by the government, and are protected from retaliation by their employers.
The False Claims Act is a complex statute and it is critical for anyone contemplating a qui tam lawsuit to consult with an attorney experienced in this area of the law.
U.S. Code Title 31, Sections 3729 – 3732
(d) Exclusion. This section does not apply to claims, records, or statements made under the Internal Revenue Code of 1986.
information the person possesses shall be served on the Government pursuant to Rule 4(d)(4) of the Federal Rules of Civil Procedure. The complaint shall be filed in camera, shall remain under seal for at least 60 days, and shall not be served on the defendant until the court so orders. The Government may elect to intervene and proceed with the action within 60 days after it receives both the complaint and the material evidence and information.
(g) Fees and expenses to prevailing defendant. In civil actions brought under
(2) Relief. Relief under paragraph (1) shall include reinstatement with the same seniority
status that employee, contractor, or agent would have had but for the discrimination, 2 times the amount of back pay, interest on the back pay, and compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys’ fees. An action under this subsection may be brought in the appropriate district court of the United States for the relief provided in this subsection.
History: (Pub. L. 97–258, Sept. 13, 1982, 96 Stat. 978; Pub. L. 99–562, §§3, 4, Oct. 27, 1986, 100 Stat. 3154, 3157; Pub. L. 100–700, §9, Nov. 19, 1988, 102 Stat. 4638; Pub. L. 101–280, §10(a), May 4, 1990, 104 Stat. 162; Pub. L. 103–272, §4(f)(1)(P), July 5, 1994, 108 Stat. 1362; Pub. L. 111–21, §4(d), May 20, 2009, 123 Stat. 1624; Pub. L. 111–148, title X, §10104(j)(2), Mar. 23, 2010, 124 Stat. 901;Pub. L. 111–203, title X, §1079A(c), July 21, 2010, 124 Stat. 2079.)
(1) Issuance and service. Whenever the Attorney General, or a designee (for purposes of this section), has reason to believe that any person may be in possession, custody, or control of any documentary material or information relevant to a false claims law investigation, the Attorney General, or a designee, may, before commencing a civil proceeding under section 3730(a) or other false claims law, or making an election under section 3730(b), issue in writing and cause to be served upon such person, a civil investigative demand requiring such person—
investigative demand issued under this section shall be a date which is not less than seven days after the date on which demand is received, unless the Attorney General or an Assistant Attorney General designated by the Attorney General determines that exceptional circumstances are present which warrant the commencement of such testimony within a lesser period of time.
(1) Legal entities. Service of any civil investigative demand issued under subsection (a) or of any petition filed under subsection (j) may be made upon a partnership, corporation, association, or other legal entity by—
(2) Production of materials. Any person upon whom any civil investigative demand for the production of documentary material has been served under this section shall make such material available for inspection and copying to the false claims law investigator identified in such demand at the principal place of business of such person, or at such other place as the false claims law investigator and the person thereafter may agree and prescribe in writing, or as the court may direct under subsection (j)(1). Such material shall be made so available on the return prescribe in writing. Such person may, upon written agreement between the person and the false claims law investigator, substitute copies for originals of all or any part of such material.
(7) Conduct of oral testimony. (A) Any person compelled to appear for oral testimony under a civil investigative demand issued under subsection (a) may be accompanied, represented, and advised by counsel. Counsel may advise such person, in confidence, with respect to any question asked of such person. Such person or counsel may object on the record to any question, in whole or in part, and shall briefly state for the record the reason for the objection. An objection may be made, received, and entered upon the record when it is claimed that such person is entitled to refuse to answer the question on the grounds of any constitutional or other legal right or privilege, including the privilege against self-incrimination. Such person may not otherwise object to or refuse to answer any question, and may not directly or through counsel otherwise interrupt the oral examination. If such person refuses to answer any question, a petition may be filed in the district court of the United States under subsection (j)(1) for an order compelling such person to answer such question.
(2) Responsibility for materials; disclosure. (A) A false claims law investigator who receives any documentary material, answers to interrogatories, or transcripts of oral testimony under this section shall transmit them to the custodian. The custodian shall take physical possession of such material, answers, or transcripts and shall be responsible for the use made of them and for the return of documentary material under paragraph (4).
(4) Conditions for return of material. If any documentary material has been produced by any person in the course of any false claims law investigation pursuant to a civil investigative demand under this section, and—