Qui Tam: The False Claims Act and Related Federal Statutes
Released: 2013-02-25T00:00:00

Introduction

Qui tam is whistleblower concept. It is the process whereby an individual sues or prosecutes in the name of the government and shares in the proceeds of any successful litigation or settlement. Although frequently punitive, it is generally a civil procedure. Unlike antitrust, RICO, and other federal punitive damage, private attorney general provisions, the individual need not have been a victim of the misconduct giving rise to the litigation. The name qui tam is the shortened version of an oft abbreviated Latin phrase which roughly translates to "he who prosecutes for himself as well as for the King." Qui tam comes to us from before the dawn of the common law. Reviled at various times throughout the ages as a breeding ground for "viperous vermin" and parasites, legislative bodies have authorized it when they consider the enforcement of some law beyond the unaided capacity or interest of authorized law enforcement officials. Best known of the contemporary members of the line is the federal False Claims Act (31 U.S.C. 3729-3733). From 1986 until expansion of the Act in 2009, False Claims Act recoveries totaled an amount in excess of $20 billion. Since then, they have totaled an additional $13.3 billion.

This is a brief discussion of the constitutional questions raised by qui tam provisions; of the history of such provisions; and of the two existing, active federal qui tam statutes: the False Claims Act and an Indian protection provision.

Background

Qui Tam in England

The earliest cited example of a qui tam provision is the 695 declaration of King Wihtred of Kent, which stated that "If a freeman works during the forbidden time [ i.e ., the Sabbath], he shall forfeit his healsfang , and the man who informs against him shall have half the fine, and [the profits arising] from the labour." By the fourteenth, fifteenth, and sixteenth century, qui tam statutes had become a common feature of English law. They brought with them, however, unintended consequences. They gave rise to a class of bounty hunters who unscrupulously exploited weaknesses in the system. "Old statutes which had been forgotten were unearthed and used as means to gratify ill-will. Litigation was stirred up simply in order that the informer might compound [ i.e., settle] for a sum of money. Threats to sue were easy means of levying blackmail." Coke in his Third Part of the Institutes of the Laws of England devotes a chapter to the reform legislation designed to control the practices of these "vexatious relators, informers, and promoters," whom he classifies as turbidum hominum genus (a class of unruly men) and as a species among the classes of "viperous vermin" – a class was so unpopular that Queen Elizabeth I at one time found it necessary to issue a proclamation shielding its members from mob violence. Legislative reform, however, appears to have been effective, because a century and a half after Coke's comments, Blackstone describes qui tam without criticism, expect to note a statutorily-cured abuse.

Early American Experience

Qui tam was no stranger to colonial America or to the early Republic. Colonial legislatures enacted qui tam statutes of their own, and colonial courts heard qui tam cases arising under these statutes, as well as under English law. Qui tam statutes dot the work of the first Congresses of the new Republic, and qui tam cases appear among the cases of the early federal courts. By the turn of the twentieth century, qui tam statutes had largely fallen into disuse in this country, although they often remained on the books.

Contemporary Federal Qui Tam Statutes

In Stevens , the Supreme Court identified four contemporary federal qui tam statutes: the False Claims Act, the Patent Act, and two Indian protection laws. One of the Indian protection statutes has since been amended so that it no longer authorizes a qui tam action. The Leahy-Smith America Invests Act replaced the Patent Act qui tam provision with one that affords victims a cause of action. Of the two survivors, the False Claims provision is by far the more often invoked.

Congress has enacted a number of other statutes, beyond those with obvious qui tam markings, which might be similarly characterized. The Supreme Court observed in United States ex rel. Marcus v. Hess that "statutes providing for a reward to informers which do not specifically either authorize or forbid the informer to institute the action are construed to authorize him to sue." The suggestion encouraged environmentalists to bring qui tam actions based on an informer-reward provision in the Rivers and Harbors Act. The lower courts were not particularly receptive to the suggestion. In fact thus far, they have generally refused to recognize the authority to bring a qui tam action under the Rivers and Harbors Act.

Yet the Court mentioned the suggestion again in Vermont Agency of Natural Resources v. United States ex rel. Stevens, and in citing the existing qui tam-specific statutes, pointed out two of the qui tam-silent informer-reward statutes. The lower federal courts, however, continue to maintain that "Congress must explicitly create qui tam statutes."

False Claims Act

Civil War Origins

The False Claims Act originated as the Act of March 2, 1863. Its brief legislative history is devoted almost exclusively to a subsequently abandoned proposal that all offenders, both military and civilian, be tried by courts martial. Senator Howard, the sponsor and floor manager of the bill in the Senate, provided the only explicit explanation of the qui tam provision:

The other clauses which follow, and which prescribe the mode of proceeding to punish persons who are not in the military service of the United States, I take it, are open to no serious objection. The effect of them is simply to hold out to a confederate a strong temptation to betray his coconspirator, and bring him to justice. The bill offers, in short, a reward to the informer who comes into court and betrays his coconspirator, if he be such; but it is not confined to that class. Even the district attorney, who is required to be vigilant in the prosecution of such cases, may be also the informer, and entitle himself to one half the forfeiture under the qui tam clause, and to one half of the double damages which may be recovered against the person committing the act. In short, sir, I have based the fourth, fifth, sixth, and seventh sections upon the old-fashion idea of hold out a temptation, and "setting a rogue to catch a rogue," which is the safest and most expeditious way I have ever discovered of bringing rogues to justice.

As enacted, the statute prohibited various frauds against the government, including making or presenting false claims, false vouchers, false oaths, forged signatures, theft, embezzlement, and conspiracy. The proscriptions applied to both military personnel and civilians. Civilian offenders faced a sentence of imprisonment of from one to five years or a fine of not less than $1,000 or more than $5,000. They also faced civil liability in the amount of $2,000, double the amount of damage sustained by the United States, and costs. Any person might bring suit in the name of the United States to recover the civil penalties, although the suit could only be settled with the consent of the court and federal prosecutors. The private parties, known as relators, were entitled to half of the penalty recovered and costs, if successful. The qui tam provisions were codified in the Revised Statutes and continued relatively unchanged until 1943 when the Attorney General sought to have them repealed.

1943 Amendments

On August 28, 1942, Attorney General Biddle requested repeal of the qui tam provisions in identical letters to the Speaker of the House and the Chairman of the Senate Judiciary Committee. He explained that:

The reasons advanced by Senator Howard for the enactment of these sections are no longer pertinent. Recent experience shows that plaintiffs in informers' suits not only fail to furnish to the United States the information which is the basis of their actions, but on the contrary, at times base the litigation on information which has been secured by the Government in the regular course of law enforcement. Such plaintiffs at times not only use information contained in indictments returned against the defendant, but also seek to use Government files to prove their cases. Consequently, informers' suits have become mere parasitical actions, occasionally brought only after law-enforcement offices have investigated and prosecuted persons guilty of a violation of law and solely because of the hope of a large reward.

He also referred to a court of appeals decision that seemed to reflect judicial condemnation of the qui tam provisions. The Senate passed the repeal proposal with little debate at the close of the 77 th Congress. The House acted with similar dispatch and passed a comparable bill when it convened in the 78 th Congress. In the interim, however, the Supreme Court had repudiated the lower court opinion which the Attorney General had cited. Moreover, opposition to repeal had developed in the Senate. As a consequence, the Senate Judiciary Committee recommended curtailing, rather than repealing, the false claim qui tam provisions. The two Houses ultimately concurred and passed Public Law 78-213.

The legislation required relators to provide the government with the evidence upon which their litigation was based and to allow the government 60 days to intervene. It precluded qui tam suits based on information already within the government's possession, and it reduced the relator's share of a successful suit from 50% to no more than 25% (no more than 10% should the government litigate the case).

1986 Amendments

The 1943 amendments addressed reform of those qui tam procedures seen as rewarding the unworthy and obstructing other law enforcement efforts. The 1986 amendments reinvigorated qui tam procedures in the face of the evidence of extensive fraud against the United States. They reflected a fairly wide array of concerns. Changes included:

an explicit cause of action for reverse false claims (false statements calculated to reduce an obligation to pay the United States), a cause of action for retaliation against whistleblowers, an increase in sanctions from a penalty of not more than $2,000 and double damages to a penalty of not less than $5,000 nor more than $10,000 and treble damages, an increase in the maximum award available to qui tam relators from not more than 25% to not more than 30%, an express definition of the knowledge required for a violation and declaration that a specific intent was unnecessary, a specific preponderance-of-the-evidence burden of proof standard, a declaration that states might act as qui tam relators, a revised jurisdictional bar for qui tam suits based on matters of public knowledge, an expanded statute of limitations, and an authorization for government use of civil investigative demands.

2009 Amendments

The amendments of the Fraud Enforcement and Recovery Act of 2009 reinforced the 1986 amendments, particularly in instances where judicial developments evidenced a need for clarification. Modifications included:

eliminating language suggesting that a false claim must be submitted directly to a federal officer or employee, adding a specific materiality element defined to encompass those false statements having natural tendency to influence payment, expanding the conspiracy proscription to apply to all of the substantive False Claims Act violations, and enlarging the reverse false claims offense to cover not only false statements but any improper avoidance.

2010 Amendments

Congress tucked modest False Claims Act amendments into the Patient Protection and Affordable Care Act (PPACA) and the Dodd-Frank Wall Street Reform Act (Dodd-Frank). PPACA clarified the definition of the relator "original source" qualification. Dodd-Frank added an explicit 3-year statute of limitations within which a civil action in response to retaliation must be commenced.

Current State of the Law

Persons Who May Be Liable

The False Claims Act declares that any "person" who violations its prohibitions may incur liability. It does not define the term "person." As a general rule, federal law understands the term to "include corporations, companies, associations, firms, partnerships, societies, and joint stock companies, as well as individuals." Local governments are considered persons for purposes of False Claims Act suits brought against them, but states and Indian tribes are not. The statute also denies federal courts jurisdiction over certain False Claims Act suits brought by private parties against Members of Congress, members of the federal judiciary, senior federal officials, or members of the armed forces.

Who May Bring an Action

The False Claims Act is designed to allow private individuals to sue on behalf of the government, but any False Claims Act litigation takes place in the shadow of the government's prerogatives. The action is brought in the name of the United States. The Attorney General may bring an action for violations. A private party may also bring such an action, but the government may elect to assume primary responsibility for the litigation from the beginning. If it initially chooses not to do so, the government is nevertheless free to intervene later in the proceedings upon a showing of cause. The government is likewise free to move to dismiss or settle the litigation over the objections of the relator, as long as the relator is given an opportunity to be heard. The government may also petition the court to limit the relator's participation in the litigation in the interest of a more effective presentation of the action.

A relator may not bring a False Claims Act action based on public information or information from official proceedings, unless he or she is the original source of the information. In addition, the False Claims Act features a first-to-file bar which precludes a second relator from bringing a later copycat action. The bar extends to any claims that allege the same material or essential elements of the same underlying fraud. Furthermore, a member of the armed forces may not bring an action against another member based on the defendant's service. On the other hand, even though relators are often referred to as private parties, government employees may bring a False Claims Act qui tam action as long as one of the statutory bars does not apply.

Basis for Liability

Seven forms of misconduct give rise to civil liability under §3729. They occur when anyone:

(A) knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval;

(B) knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim;

(C) conspires to commit a violation of subparagraph (A), (B), (D), (E), (F), or (G);

(D) has possession, custody, or control of property or money used, or to be used, by the Government and knowingly delivers, or causes to be delivered, less than all of that money or property;

(E) is authorized to make or deliver a document certifying receipt of property used, or to be used, by the Government and, intending to defraud the Government, makes or delivers the receipt without completely knowing that the information on the receipt is true;

(F) knowingly buys, or receives as a pledge of an obligation or debt, public property from an officer or employee of the Government, or a member of the Armed Forces, who lawfully may not sell or pledge property; or

(G) knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government.

Additional liability may also flow from any retaliatory action taken against those who seek to stop violations of the False Claims Act, 31 U.S.C. 3730(h).

Presentation of a false or fraudulent claim (31 U.S.C. 3279(a)(1)(A))

Prior to enactment of the Fraud Enforcement and Recovery Act of 2009 (2009 Act), this section was designated 31 U.S.C. 3279(a)(1) and read, "(a) Any person who – knowingly presents, or causes to be presented, to an officer or employee of the United States Government or member of the Armed Forces of the United States a false or fraudulent claim for payment or approval." The language had been construed in the D.C. Circuit's T otten opinion to mean that liability "only attach[ed] if the claim [was] 'presented to an officer or employee of the Government.'" Congress removed the reference to federal government employees and members of the armed services in order to clarify "that direct presentment is not required for liability to attach." The claims encompassed within §3729(a)(1)(A) are those presented to the federal government, its employees or agents, as well as those presented to others for payment, directly or indirectly, out of federal funds.

Here and throughout §3729(a)(1), the government need not show that the defendant acted with the intent to defraud. Moreover, the knowledge element can be satisfied with a showing that the defendant acted knowingly, with deliberate ignorance, or with reckless disregard. The "reckless disregard" standard contemplates a mens rea somewhere between deliberate disregard and gross negligence.

Use of false records or statements material to a false or fraudulent claim (31 U.S.C. 3279(a)(1)(B))

Section 3279(a)(1)(B) reaches, "Any person . . . who knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim." Before the 2009 Act's amendments, this section applied to, "Any person who . . . knowingly makes, uses, or causes to be made, or used, a false record or statement to get a false or fraudulent claim paid or approved by the Government ." The 2009 Act amended the section to negate the Supreme Court's suggestion in Allison Engine that liability under its provisions required proof that "a defendant must intend that the Government itself pay the claim." The 2009 Act also made materiality a specific element of §3729(a)(1)(B), thus requiring that the false record or statement have "a natural tendency to influence, or be capable of influencing, the payment or receipt of money or property." At the time of enactment, most but not all of the lower courts to consider the issue believed that §3729 contained an implicit materiality requirement. The 2009 amendments also made its modifications retroactively applicable to cases pending on June 7, 2008 and thereafter.

Conspiracy to commit liability triggering misconduct (31 U.S.C. 3279(a)(1)(C))

At one time, this section (then referred to as §3279(a)(3)) imposed civil liability upon those who conspired "to defraud the Government by getting a false or fraudulent claim allowed or paid." To some, this meant that liability for substantive misconduct and conspiracy did not correspond. For example, although civil liability might be incurred under then §3279(a)(7) for false statements calculated to conceal an obligation to pay the United States (reverse false claims), a reverse false claims conspiracy might not be thought to result in liability since it would not constitute a conspiracy to get a "claim allowed or paid," as the language of the conspiracy prohibition then required. The 2009 Act resolved the incongruity by recasting the section to establish liability for conspiracy to engage in any misconduct covered by the substantive pronouncements in §3729(a)(1) not just the misconduct described in §3729(a)(1)(A) and §3729(a)(1)(B)(the only two sections to expressly refer to claims).

Short-changing the government on the transfer of funds or other property (31 U.S.C. 3729(a)(1)(D))

The 2009 Act streamlined this section, eliminating the receipt requirement and substituting a knowledge element for one that once insisted on willful concealment or an intent to defraud. Where the section once declared:

Any person who . . . (4) has possession, custody, or control of property or money used, or to be used, by the Government and, intending to defraud the Government or willfully to conceal the property, delivers, or causes to be delivered, less property than the amount for which the person receives a certificate or receipt . . . is liable. . . . 31 U.S.C. 3729(a)(4)(2006 ed. & Supp. II).

It now states:

Any person who . . . (D) has possession, custody, or control of property or money used, or to be used, by the Government and knowingly delivers, or causes to be delivered, less than all of that money or property . . . is liable. . . . 31 U.S.C. 3729(a)(1)(D).

Issuing a false government receipt (31 U.S.C. 3729(a)(1)(E))

Section 3729(a)(1)(E)(previously designated §3729(a)(5)) establishes civil liability for any individual, authorized to certify receipt of property on behalf of the government, who knowingly certifies falsely with the intent to defraud the government. Section 3729(a)(1)(E) is the only one of the offenses enumerated in §3729(a)(1) that requires that the defendant act "intending to defraud the Government." None of the others expressly mentions an intent to defraud. Nevertheless, an intent to defraud might be considered an implicit component of the knowledge element found in the various enumerated offenses. Section 3729(b)(1), however, declares that an intent to defraud is not a component of the knowledge element.

Unlawful purchase of government property (31 U.S.C. 3729(a)(1)(F))

Section 3729(a)(1)(F)(once §3729(a)(6)) creates civil liability for those who purchase government property, or who accept government property as security, from a government officer or employee or member of the armed forces who has no authority to sell or pledge the property. The section requires the relator to show that the defendant acted with guilty knowledge.

Reverse false claims (31 U.S.C. 3729(a)(1)(G))

The 2009 Act rewrote and substantially changed the scope of §3729(a)(1)(G)(once §3729(a)(7)), the so-called reverse false claims section. It is "described as a 'reverse false claims' provision because the financial obligation that is the subject of the fraud flows in the opposite of the usual direction." Instead of attempting to obtain money or property from the government, the misconduct is designed to avoid providing money or property to the government. In its present state, the section covers two forms of misconduct: (1) making or using a false statement or record material to an obligation to provide the government with money or property, and (2) knowingly concealing or improperly avoiding or decreasing an obligation to provide the government with money or property. The first prong is the traditional form; the 2009 Act added the second.

The Committee report accompanying passage of the 2009 Act explained that the second prong was designed for greater symmetry with §3729(a)(1)(A) and §3729(a)(1)(B). Where those sections speak of misconduct calculated to induce excessive payments by the government, section 3729(a)(1)(G) speaks of misconduct calculated to avoid full payment to the government. Sections 3729(a)(1)(B) and (A) condemn making false statements and submitting false claims to induce payment by the government; §3729(a)(1)(G) was crafted to condemn making false statements and engaging in other improper conduct calculated to avoid full payment of the government. Until passage of the 2009 Act, §3729(a)(1)(G)(then styled §3729(a)(7)) only covered false statements, but had no false presentation counterpart. The section was amended in hopes of filling the gap:

Any person who . . . (G) knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government is liable. . . . 31 U.S.C. 3729(a)(1)(G)(language added by the 2009 Act in italics).

The new language does more than fill gaps. Unlike §3729(a)(1)(A), it creates civil liability for not only false or fraudulent claims, but for "any knowing and improper conduct." Moreover, unlike §3729(a)(1)(A), it establishes liability without insisting on either direct or indirect presentation. Nor need the misconduct involve a false or fraudulent statement or record; conscious or recklessly improper conduct will suffice.

Although the term "improper" is not defined, the 2009 Act added a new definition of "obligation" which considerably enlarges the scope of the false statement and the improper avoidance prongs of §3729(a)(1)(G). Parsed to its constituent parts, the definition states:

obligation means

1. an established duty 2. whether fixed or not fixed 3. arising from a. an express or implied i. contractual, ii. grantor-grantee, or iii. licensor-licensee

relationship

b. a fee-based or similar relationship c. statute or regulation, or d. the retention of any overpayment.

Earlier courts, operating without the benefit an explicit definition, had often construed the term "obligation" more narrowly. Some courts had found that the reverse false claims section did not "extend to the potential or contingent obligations to pay the government fines or penalties which [had] not been levied or assessed . . . and which [did] not arise out of an economic relationship between the government and the defendant (such as a lease or a contract or the like)." Although a few had held that the obligation need not always be fixed, most had "held that in order to create liability under (a)(7), the obligations must be fixed and definite at the time of the false claim." The 2009 Act codified a more expansive view:

The term 'obligation' is now defined under new Section 3729(b)(3) and includes fixed and contingent duties owed to the Government – including fixed liquidated obligations such as judgments, and fixed, unliquidated obligations such as tariffs on imported goods. . . . By including contingent obligations such as, 'imposed contractual, quasi-contractual, grant-or-grantee, licensor-licensee, fee-based, or similar relationships, this new section reflects the Committee's view, . . . that an 'obligation' arises across the spectrum of possibilities from the fixed amount debt obligation where all particulars are defined to the instance where there is a relationship between the Government and a person that results in a duty to pay the Government money, whether or not the amount owed is yet fixed.

It remains to be seen whether the section includes false statements or improper conduct calculated to mitigate the extent of a future fine or penalty assessment not constituting an obligation, contingent or fixed, at the time of the statement or conduct.

Retaliatory actions (31 U.S.C. 3730(h))

The False Claims Act for some time has encouraged insiders to report and cooperate with efforts to investigate and prosecute violations of the Act by offering them protection against retaliation. A claim of retaliation does not require the prior filing of a False Claims Act action, but it does require proof of some adverse action taken in response or anticipation of such action.

Until passage of the 2009 Act, the False Claims Act condemned retaliation by employers against employees and mentioned some of the protected forms of assistance. The courts concluded that only employees might claim the section's protection and that it exposed only employers to liability. The 2009 Act expanded §3730(h) to specifically include employees, contractors, and agents and eliminated references to employers and specific examples of protected assistance:

Any employee, contractor, or agent shall be entitled to all relief necessary to make that employee, contractor, or agent whole, if that employee, contractor, or agent is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts done by the employee, contractor, agent or associated others in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter.

Congress clearly intended to expand the protection to §3730(h) to include contractors and agents. Time will tell whether the courts will conclude that it intended also to expand liability under the section beyond employers to include supervisors, contractors, and agents of an employer.

Penalties and Awards

If a court finds a defendant liable under §3729, it may award treble damages; a statutory penalty ranging from $5,000 to $10,000; the government's litigation costs; and a relator's expenses, attorneys' fees, and costs. The court may reduce its damage award to no less than double damages if it finds that a defendant made prompt disclosure and provided full cooperation before judicial or administrative proceedings began. If a court finds an individual has been the victim of retaliation in violation of §3730(h), it may order the defendant to pay the individual's attorneys' fees, litigation costs, and twice the amount of "back pay, interest on back pay, and compensation for special damages sustained as a consequence" of the retaliation.

If the False Claims Act action succeeds, relators are entitled to a share in the proceeds of up to 30%. If the government has not participated in the litigation, they are entitled to an award of from 25% to 30%. If the government has participated in the litigation, they are entitled to an award of from 15% to 25%, reduced to no more than 10% when their claim was based primarily on public information. In any case, they are also entitled to attorneys' fees, expenses, and costs, but may be denied any award if they participated in the underlying fraud. If the defendant prevails in a False Claims Act action in which only a private relator has taken part, the court may award the defendant attorneys' fees and expenses, should it conclude that the action was clearly frivolous, vexatious, or brought to harass. The test for whether attorneys' fees and expenses are appropriate is said to be analogous to that used for prevailing defendants under 42 U.S.C. 1988. Such awards are thought to be appropriate only under "rare and special circumstances," when the relator's action is meritless, groundless, or without foundation; when allegations are bereft of factual support or when there is no reasonable chance of success; or when brought or pursued for an improper motive.

Procedure

The False Claims Act states that prosecution of a violation of §3729 must begin within six years, although there is an exception for undiscovered fraud which extends the deadline to 10 years as long as the action is brought within three years of discovery. The courts are divided over the question of whether this extension is available to private parties or only in cases initiated by the government.

In the case of litigation for retaliatory misconduct under §3730(h)(rather than one of §3729's proscriptions), Dodd-Frank Wall Street Reform Act established a 3-year statute of limitations. Previously, parties were required to look to the most closely analogous statute of limitations under state law, since the sole explicit False Claims Act provision applied only to causes of action under §3729.

For private litigants, the process begins with a complaint filed under seal with the federal court in the district in which a violation occurred or in which any of the defendants are found, resides, or does business. Thereafter, relators must deliver all their material evidence and information to the government. The government has 60 days, or until the end of a longer period of any extensions granted by the court for cause, in which to decide whether intervene. The government has at its disposal civil investigative demand authority which allows it to compel the production of material and testimony in its investigations.

After the government has made its initial determination of whether to intervene, the defendants are served and have 20 days in which to respond. The government, or in its absence the relator, must prove damages and all of the elements of the asserted violation by a preponderance of the evidence. A defendant, however, may not contest the presence of any elements of any violation which has been established or conceded against him in parallel criminal proceedings. Although they sue in the name of the United States, relators are bound by the 30-day deadline for appellate review rather than the 60-day deadline available to the government.

Until recently, some courts had held that the statute of limitations barred government intervention in a privately initiated case after the 6-year/3-year time period had run. That is, the government's action would not be thought to relate back to the private litigant's filing within the statute of limitations. The 2009 Act added a new subsection to §3731 to afford the government the advantage of the date of the relator's complaint as a cut-off date for statute of limitations purposes. Thus, a complaint, which would be time barred as of the date of the government's intervention, survives, if it would not be time barred on the date of the relator's earlier original complaint and relates to that complaint.

Indian Protection (25 U.S.C. 201)

All penalties which shall accrue under Title 28 of the Revised Statutes shall be sued for and recovered in an action in the nature of an action of debt, in the name of the United States, before any court having jurisdiction of the same, in any State or Territory in which the defendant shall be arrested or found, the one half to the use of the informer and the other half to the use of the United States, except when the prosecution shall be first instituted on behalf of the United States, in which case the whole shall be to their use. 25 U.S.C. 201.

Section 201 dates from 1834 and authorizes qui tam actions for violations of five separate statutes: (1) unlawful purchase of land from an Indian nation or tribe; (2) driving livestock to feed on Indian land; (3) settling on or surveying Indian land; (4) setting up a distillery in Indian country; and (5) trading in Indian country without a license.

Qui tam actions under §201 are relatively rare and appear to have arisen most often under the unlicensed trading and grazing (livestock on Indian land) provisions. In the Hall unlicensed trader case, the relators' action survived a standing challenge, but was dismissed for failure to join an indispensible party – the tribe, which had contracted for gambling equipment and services from the unlicensed supplier. In Keith , the relator's action was dismissed after the court concluded that "bureaucratic nonfeasance" made it impossible to obtain the required trader's license. Relators were somewhat more successful in Hornell , where the court upheld recovery of the monetary penalty, but declined to affirm confiscation of the station wagon that was the object of the unlicensed sale.

Section 179 prohibits grazing horses, mules, or cattle on Indian land without permission and sets the penalty at $1 per head. The circuits are divided over the question of whether the Secretary of the Interior may by regulation set the penalty at $1 per head for each day of violation. Federal district courts have jurisdiction exclusive of the states for enforcement of the penalties under §179, but they may abstain from exercising jurisdiction in favor of enforcement in a tribal court of jurisdiction.

There may be some question whether the monetary penalty established in §177 may be enforced by a qui tam action under §201. Section 201, however, applies to "penalties which shall accrue under Title 28 of the Revised Statutes,"( i.e., Rev. Stat. §§2039-2157). Section 177 appears in Title 28 of the Revised Statutes as section 2116. Thus, on its face, §201 permits a qui tam action to recover the penalties accruing under §177.

In Harlan , however, the Eighth Circuit stated in dicta that "25 U.S.C. §177 appears to deal directly with cases where, as here, a person attempts to lease tribal lands without express approval of the federal government. . . . The statute makes violators subject to a fine of $1,000, but has no provision entitling relators to bring actions under it. See James v. Watt , 716 F.2d 71 (1 st Cir. 1983)." The issue in Harlan was whether the qui tam provisions then found in 25 U.S.C. 81, relating to contracts for services which required government approval, extended to sharecrop agreements. The court referred to section 177 "simply . . . to demonstrate that a broad and general policy to oversee all contracts by Indians need not be accomplished through 25 U.S.C. §81 alone." The James case, which the court cites, held that an individual tribal member, suing as a victim of a violation of section 177, may only do so as a representative of his tribe and not on his own behalf. It says nothing of whether he may do so on behalf of the United States qui tam.

The application of section 201 to the penalties under §177 seems clear on its face, but the contrary statement in Harlan seems equally clear.

Constitutional Concerns

Qui tam evokes constitutional issues of two classes. First, to what extent may qui tam defendants claim the constitutional protections available to defendants in criminal cases? Second, is qui tam compatible with the Constitution's allocation of powers among the three branches of government? At first glance, the first question seems the least troubling. The rights available in criminal proceedings exist precisely because the proceedings are criminal. The Sixth Amendment rights –the right to counsel; to call and confront witnesses; to informed of the nature of the charges against him; to trial in the place where the offense occurred; and to a speedy and public trial before an impartial jury – apply only to "the accused" in criminal proceedings. Thus, they are inapplicable to federal qui tam proceedings which are civil in nature. Rights found elsewhere in the Constitution, however, often turn upon whether the government's action may be or must be considered punitive. Here the answers are bit less clear.

Double Jeopardy

For example, in the context of the False Claims Act, it was once thought that the Fifth Amendment's double jeopardy clause applied to "actions intended to authorize criminal punishment to vindicate public justice" but not to "civil, remedial actions brought primarily to protect the government from financial loss." It was further thought that a legislatively established civil remedy should not be considered a criminal penalty for double jeopardy purposes unless its purpose or effect was so excessive as to belie its civil designation.

But then the Court seemed to make a rule of the exception when it declared in United States v. Harper that, "under the Double Jeopardy Clause a defendant who already has been punished in a criminal prosecution may not be subjected to an additional civil sanction to the extent that the second sanction may not fairly be characterized as remedial, but only as a deterrent or retribution." Nine years later, however, in Hudson v. United States , the Court withdrew from the broad implications of Halper whose analysis it characterized as "ill considered." The appropriate test, the Court declared, is one exemplified in its pre- Halper case law:

Whether Congress, in establishing the penalizing mechanism, indicate[] either expressly or impliedly a preference for one label or the other. Second, where Congress has indicated an intention to establish a civil penalty, [was] the statutory scheme . . . so punitive either in purpose or effect as to negate that intention. In regard to this latter inquiry, we have noted that only the clearest proof could suffice to establish the unconstitutionality of a statute on such a ground.

The Court has looked to the due process standards listed in Kennedy v. Mendoza-Martinez , when defendants seek to satisfy the daunting "clearest proof" test. Although Hudson was not a qui tam case, later lower federal court qui tam cases consider it dispositive.

Excessive Fines

The Supreme Court implied in Hudson that the problems which drove its Halper analysis might more appropriately be judged by Eighth Amendment excessive fines standards. The Eighth Amendment states that "[e]xcessive bail shall not be required, nor excessive fines imposed, nor cruel and unusual punishments inflicted." In other contexts, the Supreme Court has determined that the excessive fines clause "does not constrain an award of money damages in a civil suit when the government neither has prosecuted the action nor has any right to receive a share of the damages awarded." The clause does apply to "the government's power to extract payments . . . as punishment for some offense." The critical question is not whether the procedure for extracting the payment is classified as civil or criminal or whether it serves some additional remedial purposes; if the payment constitutes punishment, it is a "fine" and as a general matter may not be excessive. A fine is excessive, in the eyes of the Court, "if it is grossly disproportionate to the gravity of the defendant's offense."

In the qui tam context, some lower courts treat False Claims Act qui tam penalties as punishment and consequently subject to excessive fines clause analysis. They have generally concluded, however, that the fines imposed in the cases before them were not excessive for Eighth Amendment purposes.

Due Process

Two Supreme Court cases suggest that permitting individuals with a personal interest to prosecute in the name of the United States may present due process issues. In Marshall v. Jerrico, Inc. , the Court rejected the argument that an administrative agency's receipt of civil penalties which it assessed and collected posed a due process risk of biased prosecution. In the course of its opinion, however, the Court noted that it "need not say with precision what limits there may be on a financial or personal interest of one who performs a prosecutorial function. In particular, we need not say whether different considerations might be held to apply if the alleged biasing influence contributed to prosecutions against particular persons, rather than to a general zealousness in the enforcement process." That fact pattern surfaced in Young v. United States ex rel. Vuitton et Fils S.A ., but the issue splintered the Court.

Young and Vuitton were engaged in trademark litigation which had resulted in the issuance of an order enjoining Young from manufacturing or distributing counterfeit versions of Vuitton's product line. Upon a showing of probable cause to believe that Young had violated the injunction, the court appointed Vuitton's lawyers to prosecute the criminal contempt. Five members of the Supreme Court agreed that Young's subsequent conviction should be overturned because, "counsel for a party that is the beneficiary of a court order may not be appointed as prosecutor in a contempt action alleging a violation of that order." Four members of the Court felt this was so because the appointment of an interested prosecutor constituted error which undermined confidence in the integrity of the criminal proceeding. One of the four went so far as to assert that the failure to appoint a disinterested prosecutor constituted a due process violation. A fifth Justice merely concurred in the result, because he felt that the lower court's appointment of a prosecutor – disinterested or not – was invalid on separation of powers grounds.

Lower federal courts thereafter confronted with due process challenges to qui tam have rejected them based on the fact that relators press their claims as private civil litigants and thus do not exercise government power subject to due process clause restrictions on criminal prosecutions.

Other due process challenges have occasionally arisen over the retroactive amendments to qui tam legislation, sometimes in conjunction with an ex post facto challenge. Ex post facto challenges have failed because the courts considered the statute insufficiently penal to trigger such concerns. Retroactivity due process challenges have failed because the courts concluded that rational legislative purposes justified retroactive application.

Separation of Powers

Is qui tam legislation compatible with the Constitution's allocation of powers among the three branches? The Constitution allocates federal governmental authority among three coordinated branches. It vests all legislative powers in Congress, executive power in the President, and the judicial power of the United States in the federal courts. It declares that Congress shall have the power to make all laws, necessary and proper, for carrying into execution its own powers and those of the executive and judicial branches. It empowers Congress to remove by impeachment the President, the Vice President, and any civil officer of the United States for treason, bribery, or other high crimes and misdemeanors. It requires the advice and consent of the Senate for the appointment of ambassadors, public ministers and consuls, judges of the Supreme Court, and all other officers of the United States (except for those inferior officers whose appointment has been otherwise provided for by law). It instructs the President "to take care that the laws be faithfully executed."

The Constitution authorizes the President to recommend legislation to Congress and to call Congress into extraordinary session. Legislation may not become law until presented to the President for his approval, and in the case of his disapproval only upon the vote of a super majority in each House. The Constitution says little about how the President may or must exercise the executive authority of the United States. It names the President commander in chief of the armed forces. It empowers the President to nominate, and with Senate advice and consent to appoint, ambassadors, public ministers, consuls, judges of the Supreme Court, and all other officers of the United States (except for those inferior officers whose appointment has been otherwise provided for by law). It permits the President to grant pardons and reprieves with respect to offenses against the United States and to require executive department heads to provide him with written opinions on matters relevant to their duties. It authorizes the President to receive ambassadors and other public ministers. Finally, the Constitution defines those cases and controversies to which the judicial power of the United States extends.

This "system of separation of powers and checks and balances . . . was regarded by the Framers as a self-executing safeguard against the encroachment or aggrandizement of one branch at the expense of the other[s]." Yet, in this interwoven fabric of governmental authority, the Framers realized that "[w]hile the Constitution diffuses power the better to secure liberty, it also contemplates that practice will integrate the dispersed powers into a workable government. It enjoins upon its branches separateness but interdependence, autonomy but reciprocity."

Commentators and litigants have questioned whether the qui tam is at odds with these basic constitutional principles. Their concerns are three. First, the Constitution grants the federal courts the judicial power over "cases and controversies." This is thought to require at least two parties with conflicting interests, presented in a context suitable for judicial resolution, i.e. , standing in a case or controversy. Yet, relators come to court with no interest of their own, only a contingent personal interest. Second, the Constitution instructs the President to see that the laws are faithfully executed. Yet, without his approval or unrestricted control, relators may initiate and prosecute litigation. Third, the President is vested with the authority to appoint officers of the United States and, with the courts and heads of departments, to appoint inferior officers. Yet, relators, who engage in activities otherwise reserved to officers and inferior officers of the United States, are appointed neither by the President, the courts, nor by the head of any department.

Each of the constitutional challenges to the False Claims Act's qui tam provisions faces an apparent hurdle. Qui tam statutes were fairly common at the time of the drafting of the Constitution. Qui tam statutes were enacted by the early Congresses, populated by men responsible for drafting and ratifying the new Constitution. Although enactment in an early Congress is hardly a sure mark of constitutionality, action there "provides contemporaneous and weighty evidence of the Constitution's meaning." Thus, critics face the problem of explaining how a process, which the Framers did not consider unconstitutional, should now be so construed.

Standing

History plays a significant role in determining whether standing exists. Standing requires (1) a concrete injury to the plaintiff's interest, (2) attributable to the defendant, (3) and amenable to judicial relief. When it put standing challenges to rest in Vermont Agency of Natural Resources v. United States ex rel. Stevens , the Supreme Court observed that:

[T]he long tradition of qui tam actions in England and the American colonies . . . is particularly relevant to the constitutional standing inquiry since . . . Article III's restriction of the judicial power to "Cases" and "Controversies" is properly understood to mean "cases and controversies of the sort traditionally amenable to, and resolved by, the judicial process."

On the more perplexing matter of the relator's injury, the Stevens Court found the injury to the United States sufficient to establish False Claims Act relator standing. With respect to the government's share of the fruits of successful litigation, the Court found standing in the relator as an agent of the defrauded United States. With respect to the relator's share, it considered him the assignee of that portion of the interest of the United States.

Relator standing is in greater doubt in cases where tangible injury to the United States is less obvious. In the case of the false marking section of the Patent Act, at least one court has held that the relator must show either an injury to himself or an injury to the United States for which he might be the agent/assignee, i.e. , "an actual or imminent injury in fact to competition, to the United States economy, or [to] the public that could be assigned to him as a qui tam plaintiff or be vindicated through this litigation."

The Stevens Court resolved the issue of qui tam standing, but it "express[ed] no view on the question of whether qui tam suits violate Article II, in particular the Appointments Clause of §2 and the 'take Care' Clause of §3."

Appointments clause

. . . [The President] shall nominate, and by and with the Advice and Consent of the Senate, shall appoint Ambassadors, other public Ministers and Consuls, Judges of the supreme Court, and all other Officers of the United States, whose Appointments are not herein otherwise provided for, and which shall be established by Law: but the Congress may by Law vest the Appointment of such inferior Officers, as they think proper, in the President alone, in the Courts of Law, or in the Heads of Departments.

The appointments clause issue in qui tam cases flows from apparently contradictory language in two Supreme Court cases. In the more recent, Buckley v. Valeo , the Court seemed to conclude that only officers appointed under Article II could be vested with conducting civil litigation on behalf of the United States:

We hold that these provisions of the Act, vesting in the Commission primary responsibility for conducting civil litigation in the courts of the United States for vindicating public rights, violate Art. II, §2, cl. 2, of the Constitution. Such functions may be discharged only by persons who are "Officers of the United States" within the language of that section.

Yet, earlier Court decisions suggested that the appointments clause applied only to those purported to hold an "office of the United States," and that Congress might authorize the performance of services in the name of the United States by those who did so without the attributes of office, selected other than under Article II. The line begins with United States v. Hartwell which found that a Treasury Department clerk was an officer of the United States for purposes of an embezzlement statute. The Court noted that the defendant had been appointed in a manner consistent with Article II to a position that "embraced the ideas of tenure, duration, emolument, and duties" and for which the duties were continuing and permanent rather than occasional or temporary.

The second case, United States v. Germaine , likewise involved a penal statute applicable to "officers of the United States." The Court concluded that the defendant, a surgeon paid to conduct and report on the results of examinations of applicants and recipients of federal pensions, was not an officer of the United States. The Court supported its view by noting that the defendant filled no office; his duties were occasional and intermittent; he kept no place of business for the public use; he gave no bond; he took no oath; he was but an agent employed by the Commissioner of Pensions to obtain information needed for the performance of the Commissioner's duties.

The Court used the same mode of analysis in Auffmordt v. Heden , when it concluded that appraisers called upon in the event of a customs dispute were not officers of the United States and consequently their selection other than under the Article II formula did not invalidate their efforts.

The Court in Buckle y distinguished rather than repudiated Germaine and Affmordt , but it did so in manner that does not necessarily resolve the qui tam issue:

[The term] "Officers of the United States" does not include all employees of the United States, but there is no claim made that the Commissioners are employees of the United States rather than officers. Employees are lesser functionaries subordinate to officers of the United States, see Auffmordt v. Hedden, 137 U.S. 310, 327 (1890); United States v. Germaine , supra , whereas the Commissioners, appointed for a statutory term, are not subject to the control or direction of any other executive, judicial, or legislative authority.

The Court later affirmed the Buckley assertion that only officers appointed in conformity with Article II could "exercis[e] significant authority pursuant to the laws of the United States."

Yet in Freytag , it acknowledged the existence of various classes empowered other than by Article II appointment who performed services in the name of the United States. There it distinguished Tax Court special trial judges (inferior officers) from special masters (not officers) along the lines suggested in Germaine rather than based on a relative degree of independence mentioned in Buckley :

The office of special trial judge is established by Law, and the duties, salary, and means of appointment for that office are specified by statute. These characteristics distinguish special trial judges from special masters, who are hired by Article III courts on a temporary, episodic basis, whose positions are not established by law, and whose duties and functions are not delineated in a statute. Furthermore, special trial judges perform more than ministerial tasks. . . . [T]he special trial judges exercise significant discretion.

Although the Court has thus far "express[ed] no view on the question of whether qui tam suits violate Article II, in particular the Appointments Clause of §2," the lower federal courts generally see no appointments clause impediments, because they do not consider qui tam relators officers of the United States:

The procedural requirements of the Appointments Clause only apply to the appointment of officers. Thus, the threshold question that we face is whether qui tam relators are "officers" for purposes of Article II. We conclude that they are not; qui tam relators do not serve in any office of the United States. There is no legislatively created office of informer or relator under the FCA. Relators are not entitled to the benefits of officeholders, such as drawing a government salary. And they are not subject to the requirement, noted long ago by the Supreme Court, that the definition of an officer "embraces the ideas of tenure, duration, emolument, and duties, and the latter were continuing and permanent, not occasional or temporary." United States v. Germaine , 99 U.S. 508, 511-12 (1878); see also Auffmordt v. Hedden , 137 U.S. 310, 327 (1890).

Take care

Unlike the appointments clause, the take care clause does not vest authority in the President. Instead, it imposes a responsibility upon him. The Framers, however, allocated powers among the branches so as to prevent Congress or the courts from undermining or unduly interfering with the President's ability to perform his constitutional duties, including the duty to take care to see that the laws are faithfully executed. Morrison v. Olson presents a question perhaps most closely analogous to the one of whether qui tam statutes undermine or unduly interfere with the President's ability to fulfill his responsibilities under the take care clause. The case involved the constitutionality of the independent counsel provisions of the Ethics in Government Act. The statute permitted judicial appointment of a special prosecutor (independent counsel) under limited circumstances to investigate and in some instances to criminally prosecute senior executive branch officials.

It was suggested that the Act impermissibly "reduc[ed] the President's ability to control the prosecutorial powers wielded by the independent counsel," both specifically when it precluded removal of the special prosecutor except for cause and as a general matter. The Court disagreed. It began by noting that the Constitution's "system of separation of powers and checks and balances" was crafted "as a self-executing safe-guard against the encroachment or aggrandizement of one branch at the expense of the other." It found that the Act presented no such threat. The Court then ran through an abbreviated check list of features which might be said to restrict the Executive's prosecutorial control as well as those which appeared to re-enforce his control.

It acknowledged that under the Act the President's agent, the Attorney General: (1) did not select the special prosecutor; (2) did not define the scope of the special prosecutor's inquiry; and (3) could not remove the special prosecutor without cause. On the other hand, (1) a special prosecutor could be selected only upon the Attorney General's unreviewable request; (2) the court defined the special prosecutor's scope of authority based upon the facts contained in that request; and (3) the Attorney General might remove the special prosecutor for cause. All of which indicated to the Court that "the Act give[s] the Executive Branch sufficient control over the independent counsel to ensure that the President is able to perform his constitutionally assigned duties."

Lower court False Claims Act qui tam cases decided in Morrison 's shadow generally reached the same conclusion – the False Claims Act affords the Executive Branch sufficient control to turn aside a take care clause challenge – although they often concede that the control factors of the two were not the same.

False Claims Act (Text)

31 U.S.C. 3729

(a) Liability for certain acts.–

(1) In general.– Subject to paragraph (2), any person who –

(A) knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval;

(B) knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim;

(C) conspires to commit a violation of subparagraph (A), (B), (D), (E), (F), or (G);

(D) has possession, custody, or control of property or money used, or to be used, by the Government and knowingly delivers, or causes to be delivered, less than all of that money or property;

(E) is authorized to make or deliver a document certifying receipt of property used, or to be used, by the Government and, intending to defraud the Government, makes or delivers the receipt without completely knowing that the information on the receipt is true;

(F) knowingly buys, or receives as a pledge of an obligation or debt, public property from an officer or employee of the Government, or a member of the Armed Forces, who lawfully may not sell or pledge property; or

(G) knowingly makes, uses, or causes to be made or used, a false record or statement material to an obligation to pay or transmit money or property to the Government, or knowingly conceals or knowingly and improperly avoids or decreases an obligation to pay or transmit money or property to the Government,

is liable to the United States Government for a civil penalty of not less than $5,000 and not more than $10,000, as adjusted by the Federal Civil Penalties Inflation Adjustment Act of 1990 (28 U.S.C. 2461 note; P.L. 104-410 ), plus 3 times the amount of damages which the Government sustains because of the act of that person.

(2) Reduced damages.– If the court finds that–

(A) the person committing the violation of this subsection furnished officials of the United States responsible for investigating false claims violations with all information known to such person about the violation within 30 days after the date on which the defendant first obtained the information;

(B) such person fully cooperated with any Government investigation of such violation; and

(C) at the time such person furnished the United States with the information about the violation, no criminal prosecution, civil action, or administrative action had commenced under this title with respect to such violation, and the person did not have actual knowledge of the existence of an investigation into such violation,

the court may assess not less than 2 times the amount of damages which the Government sustains because of the act of that person.

(3) Costs of civil actions.– A person violating this subsection shall also be liable to the United States Government for the costs of a civil action brought to recover any such penalty or damages.

(b) Definitions.– For purposes of this section– (1) the terms "knowing" and "knowingly" –

(A) mean that a person, with respect to information–

(i) has actual knowledge of the information;

(ii) acts in deliberate ignorance of the truth or falsity of the information; or

(iii) acts in reckless disregard of the truth or falsity of the information; and

(B) require no proof of specific intent to defraud;

(2) the term "claim" –

(A) means any request or demand, whether under a contract or otherwise, for money or property and whether or not the United States has title to the money or property, that—

(i) is presented to an officer, employee, or agent of the United States; or

(ii) is made to a contractor, grantee, or other recipient, if the money or property is to be spent or used on the Government's behalf or to advance a Government program or interest, and if the United States Government—

(I) provides or has provided any portion of the money or property requested or demanded; or

(II) will reimburse such contractor, grantee, or other recipient for any portion of the money or property which is requested or demanded; and

(B) does not include requests or demands for money or property that the Government has paid to an individual as compensation for Federal employment or as an income subsidy with no restrictions on that individual's use of the money or property;

(3) the term "obligation" means an established duty, whether or not fixed, arising from an express or implied contractual, grantor-grantee, or licensor-licensee relationship, from a fee-based or similar relationship, from statute or regulation, or from the retention of any overpayment; and

(4) the term "material" means having a natural tendency to influence, or be capable of influencing, the payment or receipt of money or property.

(c) Exemption from disclosure. –Any information furnished pursuant to subsection (a)(2) shall be exempt from disclosure under section 552 of title 5.

(d) Exclusion. –This section does not apply to claims, records, or statements made under the Internal Revenue Code of 1986. [(e) Redesignated (d)]

31 U.S.C. 3730

(a) Responsibilities of the Attorney General. –The Attorney General diligently shall investigate a violation under section 3729. If the Attorney General finds that a person has violated or is violating section 3729, the Attorney General may bring a civil action under this section against the person.

(b) Actions by private persons. – (1) A person may bring a civil action for a violation of section 3729 for the person and for the United States Government. The action shall be brought in the name of the Government. The action may be dismissed only if the court and the Attorney General give written consent to the dismissal and their reasons for consenting. (2) A copy of the complaint and written disclosure of substantially all material evidence and 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. (3) The Government may, for good cause shown, move the court for extensions of the time during which the complaint remains under seal under paragraph (2). Any such motions may be supported by affidavits or other submissions in camera. The defendant shall not be required to respond to any complaint filed under this section until 20 days after the complaint is unsealed and served upon the defendant pursuant to Rule 4 of the Federal Rules of Civil Procedure.

(4) Before the expiration of the 60-day period or any extensions obtained under paragraph (3), the Government shall–

(A) proceed with the action, in which case the action shall be conducted by the Government; or

(B) notify the court that it declines to take over the action, in which case the person bringing the action shall have the right to conduct the action.

(5) When a person brings an action under this subsection, no person other than the Government may intervene or bring a related action based on the facts underlying the pending action. (c) Rights of the parties to qui tam actions. – (1) If the Government proceeds with the action, it shall have the primary responsibility for prosecuting the action, and shall not be bound by an act of the person bringing the action. Such person shall have the right to continue as a party to the action, subject to the limitations set forth in paragraph (2). (2)(A) The Government may dismiss the action notwithstanding the objections of the person initiating the action if the person has been notified by the Government of the filing of the motion and the court has provided the person with an opportunity for a hearing on the motion. (B) The Government may settle the action with the defendant notwithstanding the objections of the person initiating the action if the court determines, after a hearing, that the proposed settlement is fair, adequate, and reasonable under all the circumstances. Upon a showing of good cause, such hearing may be held in camera. (C) Upon a showing by the Government that unrestricted participation during the course of the litigation by the person initiating the action would interfere with or unduly delay the Government's prosecution of the case, or would be repetitious, irrelevant, or for purposes of harassment, the court may, in its discretion, impose limitations on the person's participation, such as–

(i) limiting the number of witnesses the person may call;

(ii) limiting the length of the testimony of such witnesses;

(iii) limiting the person's cross-examination of witnesses; or

(iv) otherwise limiting the participation by the person in the litigation.

(D) Upon a showing by the defendant that unrestricted participation during the course of the litigation by the person initiating the action would be for purposes of harassment or would cause the defendant undue burden or unnecessary expense, the court may limit the participation by the person in the litigation. (3) If the Government elects not to proceed with the action, the person who initiated the action shall have the right to conduct the action. If the Government so requests, it shall be served with copies of all pleadings filed in the action and shall be supplied with copies of all deposition transcripts (at the Government's expense). When a person proceeds with the action, the court, without limiting the status and rights of the person initiating the action, may nevertheless permit the Government to intervene at a later date upon a showing of good cause. (4) Whether or not the Government proceeds with the action, upon a showing by the Government that certain actions of discovery by the person initiating the action would interfere with the Government's investigation or prosecution of a criminal or civil matter arising out of the same facts, the court may stay such discovery for a period of not more than 60 days. Such a showing shall be conducted in camera. The court may extend the 60-day period upon a further showing in camera that the Government has pursued the criminal or civil investigation or proceedings with reasonable diligence and any proposed discovery in the civil action will interfere with the ongoing criminal or civil investigation or proceedings. (5) Notwithstanding subsection (b), the Government may elect to pursue its claim through any alternate remedy available to the Government, including any administrative proceeding to determine a civil money penalty. If any such alternate remedy is pursued in another proceeding, the person initiating the action shall have the same rights in such proceeding as such person would have had if the action had continued under this section. Any finding of fact or conclusion of law made in such other proceeding that has become final shall be conclusive on all parties to an action under this section. For purposes of the preceding sentence, a finding or conclusion is final if it has been finally determined on appeal to the appropriate court of the United States, if all time for filing such an appeal with respect to the finding or conclusion has expired, or if the finding or conclusion is not subject to judicial review. (d) Award to qui tam plaintiff. – (1) If the Government proceeds with an action brought by a person under subsection (b), such person shall, subject to the second sentence of this paragraph, receive at least 15 percent but not more than 25 percent of the proceeds of the action or settlement of the claim, depending upon the extent to which the person substantially contributed to the prosecution of the action. Where the action is one which the court finds to be based primarily on disclosures of specific information (other than information provided by the person bringing the action) relating to allegations or transactions in a criminal, civil, or administrative hearing, in a congressional, administrative, or Government Accounting Office report, hearing, audit, or investigation, or from the news media, the court may award such sums as it considers appropriate, but in no case more than 10 percent of the proceeds, taking into account the significance of the information and the role of the person bringing the action in advancing the case to litigation. Any payment to a person under the first or second sentence of this paragraph shall be made from the proceeds. Any such person shall also receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. All such expenses, fees, and costs shall be awarded against the defendant. (2) If the Government does not proceed with an action under this section, the person bringing the action or settling the claim shall receive an amount which the court decides is reasonable for collecting the civil penalty and damages. The amount shall be not less than 25 percent and not more than 30 percent of the proceeds of the action or settlement and shall be paid out of such proceeds. Such person shall also receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys' fees and costs. All such expenses, fees, and costs shall be awarded against the defendant. (3) Whether or not the Government proceeds with the action, if the court finds that the action was brought by a person who planned and initiated the violation of section 3729 upon which the action was brought, then the court may, to the extent the court considers appropriate, reduce the share of the proceeds of the action which the person would otherwise receive under paragraph (1) or (2) of this subsection, taking into account the role of that person in advancing the case to litigation and any relevant circumstances pertaining to the violation. If the person bringing the action is convicted of criminal conduct arising from his or her role in the violation of section 3729, that person shall be dismissed from the civil action and shall not receive any share of the proceeds of the action. Such dismissal shall not prejudice the right of the United States to continue the action, represented by the Department of Justice. (4) If the Government does not proceed with the action and the person bringing the action conducts the action, the court may award to the defendant its reasonable attorneys' fees and expenses if the defendant prevails in the action and the court finds that the claim of the person bringing the action was clearly frivolous, clearly vexatious, or brought primarily for purposes of harassment.

(e) Certain actions barred. – (1) No court shall have jurisdiction over an action brought by a former or present member of the armed forces under subsection (b) of this section against a member of the armed forces arising out of such person's service in the armed forces. (2)(A) No court shall have jurisdiction over an action brought under subsection (b) against a Member of Congress, a member of the judiciary, or a senior executive branch official if the action is based on evidence or information known to the Government when the action was brought. (B) For purposes of this paragraph, "senior executive branch official" means any officer or employee listed in paragraphs (1) through (8) of section 101(f) of the Ethics in Government Act of 1978 (5 U.S.C. App.). (3) In no event may a person bring an action under subsection (b) which is based upon allegations or transactions which are the subject of a civil suit or an administrative civil money penalty proceeding in which the Government is already a party. (4)(A) The court shall dismiss an action or claim under this section, unless opposed by the Government, if substantially the same allegations or transactions as alleged in the action or claim were publicly disclosed –

(i) in a Federal criminal, civil, or administrative hearing in which the Government or its agent is a party;

( ii) in a congressional, Government Accountability Office, or other Federal report, hearing, audit, or investigation; or

(iii) from the news media, unless the action is brought by the Attorney General or the person bringing the action is an original source of the information.

(B) For purposes of this paragraph, "original source" means an individual who either (i) prior to a public disclosure under subsection (e)(4)(a), has voluntarily disclosed to the Government the information on which allegations or transactions in a claim are based, or (2) who has knowledge that is independent of and materially adds to the publicly disclosed allegations or transactions, and who has voluntarily provided the information to the Government before filing an action under this section.

(f) Government not liable for certain expenses. –The Government is not liable for expenses which a person incurs in bringing an action under this section.

(g) Fees and expenses to prevailing defendant. –In civil actions brought under this section by the United States, the provisions of section 2412(d) of title 28 shall apply.

( h) Relief f rom r etaliatory a ctions . -

(1) In general . - Any employee, contractor, or agent shall be entitled to all relief necessary to make that employee, contractor, or agent whole, if that employee, contractor, or agent is discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against in the terms and conditions of employment because of lawful acts done by the employee, contractor, agent or associated others in furtherance of an action under this section or other efforts to stop 1 or more violations of this subchapter.

(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.

(3) Limitation on bringing civil action. - A civil action under this subsection may not be brought more than 3 years after the date when the retaliation occurred.

31 U.S.C. 3731

( a) A subpena requiring the attendance of a witness at a trial or hearing conducted under section 3730 of this title may be served at any place in the United States. (b) A civil action under section 3730 may not be brought–

(1) more than 6 years after the date on which the violation of section 3729 is committed, or

(2) more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date on which the violation is committed,

whichever occurs last. (c) If the Government elects to intervene and proceed with an action brought under 3730(b), the Government may file its own complaint or amend the complaint of a person who has brought an action under section 3730(b) to clarify or add detail to the claims in which the Government is intervening and to add any additional claims with respect to which the Government contends it is entitled to relief. For statute of limitations purposes, any such Government pleading shall relate back to the filing date of the complaint of the person who originally brought the action, to the extent that the claim of the Government arises out of the conduct, transactions, or occurrences set forth, or attempted to be set forth, in the prior complaint of that person. (d) In any action brought under section 3730 , the United States shall be required to prove all essential elements of the cause of action, including damages, by a preponderance of the evidence. (e) Notwithstanding any other provision of law, the Federal Rules of Criminal Procedure, or the Federal Rules of Evidence, a final judgment rendered in favor of the United States in any criminal proceeding charging fraud or false statements, whether upon a verdict after trial or upon a plea of guilty or nolo contendere, shall estop the defendant from denying the essential elements of the offense in any action which involves the same transaction as in the criminal proceeding and which is brought under subsection (a) or (b) of section 3730.

31 U.S.C. 3732

(a) Actions under section 3730 . —Any action under section 3730 may be brought in any judicial district in which the defendant or, in the case of multiple defendants, any one defendant can be found, resides, transacts business, or in which any act proscribed by section 3729 occurred. A summons as required by the Federal Rules of Civil Procedure shall be issued by the appropriate district court and served at any place within or outside the United States. (b) Claims under state law. —The district courts shall have jurisdiction over any action brought under the laws of any State for the recovery of funds paid by a State or local government if the action arises from the same transaction or occurrence as an action brought under section 3730. (c) Service on State or local authorities. —With respect to any State or local government that is named as a co-plaintiff with the United States in an action brought under subsection (b), a seal on the action ordered by the court under section 3730(b) shall not preclude the Government or the person bringing the action from serving the complaint, any other pleadings, or the written disclosure of substantially all material evidence and information possessed by the person bringing the action on the law enforcement authorities that are authorized under the law of that State or local government to investigate and prosecute such actions on behalf of such governments, except that such seal applies to the law enforcement authorities so served to the same extent as the seal applies to other parties in the action.

31 U.S.C. 3733

(a) In general. –

(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—

(A) to produce such documentary material for inspection and copying,

(B) to answer in writing written interrogatories with respect to such documentary material or information,

(C) to give oral testimony concerning such documentary material or information, or

(D) to furnish any combination of such material, answers, or testimony.

The Attorney General may delegate the authority to issue civil investigative demands under this subsection. Whenever a civil investigative demand is an express demand for any product of discovery, the Attorney General, the Deputy Attorney General, or an Assistant Attorney General shall cause to be served, in any manner authorized by this section, a copy of such demand upon the person from whom the discovery was obtained and shall notify the person to whom such demand is issued of the date on which such copy was served. Any information obtained by the Attorney General or a designee of the Attorney General under this section may be shared with any qui tam relator if the Attorney General or designee determine it is necessary as part of any false claims act investigation.

(2) Contents and deadlines. –

(A) Each civil investigative demand issued under paragraph (1) shall state the nature of the conduct constituting the alleged violation of a false claims law which is under investigation, and the applicable provision of law alleged to be violated.

(B) If such demand is for the production of documentary material, the demand shall–

(i) describe each class of documentary material to be produced with such definiteness and certainty as to permit such material to be fairly identified;

(ii) prescribe a return date for each such class which will provide a reasonable period of time within which the material so demanded may be assembled and made available for inspection and copying; and

(iii) identify the false claims law investigator to whom such material shall be made available.

(C) If such demand is for answers to written interrogatories, the demand shall–-

(i) set forth with specificity the written interrogatories to be answered;

(ii) prescribe dates at which time answers to written interrogatories shall be submitted; and

(iii) identify the false claims law investigator to whom such answers shall be submitted.

(D) If such demand is for the giving of oral testimony, the demand shall—

(i) prescribe a date, time, and place at which oral testimony shall be commenced;

(ii) identify a false claims law investigator who shall conduct the examination and the custodian to whom the transcript of such examination shall be submitted;

(iii) specify that such attendance and testimony are necessary to the conduct of the investigation;

(iv) notify the person receiving the demand of the right to be accompanied by an attorney and any other representative; and

(v) describe the general purpose for which the demand is being issued and the general nature of the testimony, including the primary areas of inquiry, which will be taken pursuant to the demand.

(E) Any civil investigative demand issued under this section which is an express demand for any product of discovery shall not be returned or returnable until 20 days after a copy of such demand has been served upon the person from whom the discovery was obtained.

(F) The date prescribed for the commencement of oral testimony pursuant to a civil 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.

(G) The Attorney General shall not authorize the issuance under this section of more than one civil investigative demand for oral testimony by the same person unless the person requests otherwise or unless the Attorney General, after investigation, notifies that person in writing that an additional demand for oral testimony is necessary.

(b) Protected material or information. –

(1) In general. –A civil investigative demand issued under subsection (a) may not require the production of any documentary material, the submission of any answers to written interrogatories, or the giving of any oral testimony if such material, answers, or testimony would be protected from disclosure under–

(A) the standards applicable to subpoenas or subpoenas duces tecum issued by a court of the United States to aid in a grand jury investigation; or

(B) the standards applicable to discovery requests under the Federal Rules of Civil Procedure, to the extent that the application of such standards to any such demand is appropriate and consistent with the provisions and purposes of this section.

(2) Effect on other orders, rules, and laws. –Any such demand which is an express demand for any product of discovery supersedes any inconsistent order, rule, or provision of law (other than this section) preventing or restraining disclosure of such product of discovery to any person. Disclosure of any product of discovery pursuant to any such express demand does not constitute a waiver of any right or privilege which the person making such disclosure may be entitled to invoke to resist discovery of trial preparation materials.

(c) Service; jurisdiction. –

(1) By whom served. –Any civil investigative demand issued under subsection (a) may be served by a false claims law investigator, or by a United States marshal or a deputy marshal, at any place within the territorial jurisdiction of any court of the United States.

(2) Service in foreign countries. –Any such demand or any petition filed under subsection (j) may be served upon any person who is not found within the territorial jurisdiction of any court of the United States in such manner as the Federal Rules of Civil Procedure prescribe for service in a foreign country. To the extent that the courts of the United States can assert jurisdiction over any such person consistent with due process, the United States District Court for the District of Columbia shall have the same jurisdiction to take any action respecting compliance with this section by any such person that such court would have if such person were personally within the jurisdiction of such court.

(d) Service upon legal entities and natural persons. –

(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–

(A) delivering an executed copy of such demand or petition to any partner, executive officer, managing agent, or general agent of the partnership, corporation, association, or entity, or to any agent authorized by appointment or by law to receive service of process on behalf of such partnership, corporation, association, or entity;

(B) delivering an executed copy of such demand or petition to the principal office or place of business of the partnership, corporation, association, or entity; or

(C) depositing an executed copy of such demand or petition in the United States mails by registered or certified mail, with a return receipt requested, addressed to such partnership, corporation, association, or entity at its principal office or place of business.

(2) Natural persons. –Service of any such demand or petition may be made upon any natural person by–

(A) delivering an executed copy of such demand or petition to the person; or

(B) depositing an executed copy of such demand or petition in the United States mails by registered or certified mail, with a return receipt requested, addressed to the person at the person's residence or principal office or place of business.

(e) Proof of service. –A verified return by the individual serving any civil investigative demand issued under subsection (a) or any petition filed under subsection (j) setting forth the manner of such service shall be proof of such service. In the case of service by registered or certified mail, such return shall be accompanied by the return post office receipt of delivery of such demand. (f) Documentary material. – (1) Sworn certificates. –The production of documentary material in response to a civil investigative demand served under this section shall be made under a sworn certificate, in such form as the demand designates, by–

(A) in the case of a natural person, the person to whom the demand is directed, or

(B) in the case of a person other than a natural person, a person having knowledge of the facts and circumstances relating to such production and authorized to act on behalf of such person.

The certificate shall state that all of the documentary material required by the demand and in the possession, custody, or control of the person to whom the demand is directed has been produced and made available to the false claims law investigator identified in the demand.

(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 date specified in such demand, or on such later date as the false claims law investigator may 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.

(g) Interrogatories. –Each interrogatory in a civil investigative demand served under this section shall be answered separately and fully in writing under oath and shall be submitted under a sworn certificate, in such form as the demand designates, by–

(1) in the case of a natural person, the person to whom the demand is directed, or

(2) in the case of a person other than a natural person, the person or persons responsible for answering each interrogatory.

If any interrogatory is objected to, the reasons for the objection shall be stated in the certificate instead of an answer. The certificate shall state that all information required by the demand and in the possession, custody, control, or knowledge of the person to whom the demand is directed has been submitted. To the extent that any information is not furnished, the information shall be identified and reasons set forth with particularity regarding the reasons why the information was not furnished. (h) Oral examinations. –

(1) Procedures. –The examination of any person pursuant to a civil investigative demand for oral testimony served under this section shall be taken before an officer authorized to administer oaths and affirmations by the laws of the United States or of the place where the examination is held. The officer before whom the testimony is to be taken shall put the witness on oath or affirmation and shall, personally or by someone acting under the direction of the officer and in the officer's presence, record the testimony of the witness. The testimony shall be taken stenographically and shall be transcribed. When the testimony is fully transcribed, the officer before whom the testimony is taken shall promptly transmit a copy of the transcript of the testimony to the custodian. This subsection shall not preclude the taking of testimony by any means authorized by, and in a manner consistent with, the Federal Rules of Civil Procedure.

(2) Persons present. –The false claims law investigator conducting the examination shall exclude from the place where the examination is held all persons except the person giving the testimony, the attorney for and any other representative of the person giving the testimony, the attorney for the Government, any person who may be agreed upon by the attorney for the Government and the person giving the testimony, the officer before whom the testimony is to be taken, and any stenographer taking such testimony.

(3) Where testimony taken. –The oral testimony of any person taken pursuant to a civil investigative demand served under this section shall be taken in the judicial district of the United States within which such person resides, is found, or transacts business, or in such other place as may be agreed upon by the false claims law investigator conducting the examination and such person.

(4) Transcript of testimony. –When the testimony is fully transcribed, the false claims law investigator or the officer before whom the testimony is taken shall afford the witness, who may be accompanied by counsel, a reasonable opportunity to examine and read the transcript, unless such examination and reading are waived by the witness. Any changes in form or substance which the witness desires to make shall be entered and identified upon the transcript by the officer or the false claims law investigator, with a statement of the reasons given by the witness for making such changes. The transcript shall then be signed by the witness, unless the witness in writing waives the signing, is ill, cannot be found, or refuses to sign. If the transcript is not signed by the witness within 30 days after being afforded a reasonable opportunity to examine it, the officer or the false claims law investigator shall sign it and state on the record the fact of the waiver, illness, absence of the witness, or the refusal to sign, together with the reasons, if any, given therefor.

(5) Certification and delivery to custodian. –The officer before whom the testimony is taken shall certify on the transcript that the witness was sworn by the officer and that the transcript is a true record of the testimony given by the witness, and the officer or false claims law investigator shall promptly deliver the transcript, or send the transcript by registered or certified mail, to the custodian.

(6) Furnishing or inspection of transcript by witness. –Upon payment of reasonable charges therefor, the false claims law investigator shall furnish a copy of the transcript to the witness only, except that the Attorney General, the Deputy Attorney General, or an Assistant Attorney General may, for good cause, limit such witness to inspection of the official transcript of the witness' testimony.

(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.

(B) If such person refuses to answer any question on the grounds of the privilege against self-incrimination, the testimony of such person may be compelled in accordance with the provisions of part V of title 18.

(8) Witness fees and allowances. –Any person appearing for oral testimony under a civil investigative demand issued under subsection (a) shall be entitled to the same fees and allowances which are paid to witnesses in the district courts of the United States.

(i) Custodians of documents, answers, and transcripts. –

(1) Designation. –The Attorney General shall designate a false claims law investigator to serve as custodian of documentary material, answers to interrogatories, and transcripts of oral testimony received under this section, and shall designate such additional false claims law investigators as the Attorney General determines from time to time to be necessary to serve as deputies to the custodian.

(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).

(B) The custodian may cause the preparation of such copies of such documentary material, answers to interrogatories, or transcripts of oral testimony as may be required for official use by any false claims law investigator, or other officer or employee of the Department of Justice. Such material, answers, and transcripts may be used by any such authorized false claims law investigator or other officer or employee in connection with the taking of oral testimony under this section.

(C) Except as otherwise provided in this subsection, no documentary material, answers to interrogatories, or transcripts of oral testimony, or copies thereof, while in the possession of the custodian, shall be available for examination by any individual other than a false claims law investigator or other officer or employee of the Department of Justice authorized under subparagraph (B). The prohibition in the preceding sentence on the availability of material, answers, or transcripts shall not apply if consent is given by the person who produced such material, answers, or transcripts, or, in the case of any product of discovery produced pursuant to an express demand for such material, consent is given by the person from whom the discovery was obtained. Nothing in this subparagraph is intended to prevent disclosure to the Congress, including any committee or subcommittee of the Congress, or to any other agency of the United States for use by such agency in furtherance of its statutory responsibilities.

(D) While in the possession of the custodian and under such reasonable terms and conditions as the Attorney General shall prescribe–

(i) documentary material and answers to interrogatories shall be available for examination by the person who produced such material or answers, or by a representative of that person authorized by that person to examine such material and answers; and

(ii) transcripts of oral testimony shall be available for examination by the person who produced such testimony, or by a representative of that person authorized by that person to examine such transcripts.

(3) Use of material, answers, or transcripts in other proceedings. –Whenever any attorney of the Department of Justice has been designated to appear before any court, grand jury, or Federal agency in any case or proceeding, the custodian of any documentary material, answers to interrogatories, or transcripts of oral testimony received under this section may deliver to such attorney such material, answers, or transcripts for official use in connection with any such case or proceeding as such attorney determines to be required. Upon the completion of any such case or proceeding, such attorney shall return to the custodian any such material, answers, or transcripts so delivered which have not passed into the control of such court, grand jury, or agency through introduction into the record of such case or proceeding.

(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—

(A) any case or proceeding before the court or grand jury arising out of such investigation, or any proceeding before any Federal agency involving such material, has been completed, or

(B) no case or proceeding in which such material may be used has been commenced within a reasonable time after completion of the examination and analysis of all documentary material and other information assembled in the course of such investigation,

the custodian shall, upon written request of the person who produced such material, return to such person any such material (other than copies furnished to the false claims law investigator under subsection (f)(2) or made for the Department of Justice under paragraph (2)(B)) which has not passed into the control of any court, grand jury, or agency through introduction into the record of such case or proceeding.

(5) Appointment of successor custodians. –In the event of the death, disability, or separation from service in the Department of Justice of the custodian of any documentary material, answers to interrogatories, or transcripts of oral testimony produced pursuant to a civil investigative demand under this section, or in the event of the official relief of such custodian from responsibility for the custody and control of such material, answers, or transcripts, the Attorney General shall promptly–

(A) designate another false claims law investigator to serve as custodian of such material, answers, or transcripts, and

(B) transmit in writing to the person who produced such material, answers, or testimony notice of the identity and address of the successor so designated.

Any person who is designated to be a successor under this paragraph shall have, with regard to such material, answers, or transcripts, the same duties and responsibilities as were imposed by this section upon that person's predecessor in office, except that the successor shall not be held responsible for any default or dereliction which occurred before that designation.

(j) Judicial proceedings. –

(1) Petition for enforcement. –Whenever any person fails to comply with any civil investigative demand issued under subsection (a), or whenever satisfactory copying or reproduction of any material requested in such demand cannot be done and such person refuses to surrender such material, the Attorney General may file, in the district court of the United States for any judicial district in which such person resides, is found, or transacts business, and serve upon such person a petition for an order of such court for the enforcement of the civil investigative demand.

(2) Petition to modify or set aside demand. – (A) Any person who has received a civil investigative demand issued under subsection (a) may file, in the district court of the United States for the judicial district within which such person resides, is found, or transacts business, and serve upon the false claims law investigator identified in such demand a petition for an order of the court to modify or set aside such demand. In the case of a petition addressed to an express demand for any product of discovery, a petition to modify or set aside such demand may be brought only in the district court of the United States for the judicial district in which the proceeding in which such discovery was obtained is or was last pending. Any petition under this subparagraph must be filed—

(i) within 20 days after the date of service of the civil investigative demand, or at any time before the return date specified in the demand, whichever date is earlier, or

(ii) within such longer period as may be prescribed in writing by any false claims law investigator identified in the demand.

(B) The petition shall specify each ground upon which the petitioner relies in seeking relief under subparagraph (A), and may be based upon any failure of the demand to comply with the provisions of this section or upon any constitutional or other legal right or privilege of such person. During the pendency of the petition in the court, the court may stay, as it deems proper, the running of the time allowed for compliance with the demand, in whole or in part, except that the person filing the petition shall comply with any portions of the demand not sought to be modified or set aside.

(3) Petition to modify or set aside demand for product of discovery. – (A) In the case of any civil investigative demand issued under subsection (a) which is an express demand for any product of discovery, the person from whom such discovery was obtained may file, in the district court of the United States for the judicial district in which the proceeding in which such discovery was obtained is or was last pending, and serve upon any false claims law investigator identified in the demand and upon the recipient of the demand, a petition for an order of such court to modify or set aside those portions of the demand requiring production of any such product of discovery. Any petition under this subparagraph must be filed–

(i) within 20 days after the date of service of the civil investigative demand, or at any time before the return date specified in the demand, whichever date is earlier, or

(ii) within such longer period as may be prescribed in writing by any false claims law investigator identified in the demand.

(B) The petition shall specify each ground upon which the petitioner relies in seeking relief under subparagraph (A), and may be based upon any failure of the portions of the demand from which relief is sought to comply with the provisions of this section, or upon any constitutional or other legal right or privilege of the petitioner. During the pendency of the petition, the court may stay, as it deems proper, compliance with the demand and the running of the time allowed for compliance with the demand.

(4) Petition to require performance by custodian of duties. –At any time during which any custodian is in custody or control of any documentary material or answers to interrogatories produced, or transcripts of oral testimony given, by any person in compliance with any civil investigative demand issued under subsection (a), such person, and in the case of an express demand for any product of discovery, the person from whom such discovery was obtained, may file, in the district court of the United States for the judicial district within which the office of such custodian is situated, and serve upon such custodian, a petition for an order of such court to require the performance by the custodian of any duty imposed upon the custodian by this section.

(5) Jurisdiction. –Whenever any petition is filed in any district court of the United States under this subsection, such court shall have jurisdiction to hear and determine the matter so presented, and to enter such order or orders as may be required to carry out the provisions of this section. Any final order so entered shall be subject to appeal under section 1291 of title 28. Any disobedience of any final order entered under this section by any court shall be punished as a contempt of the court.

(6) Applicability of federal rules of civil procedure. –The Federal Rules of Civil Procedure shall apply to any petition under this subsection, to the extent that such rules are not inconsistent with the provisions of this section.

(k) Disclosure exemption. –Any documentary material, answers to written interrogatories, or oral testimony provided under any civil investigative demand issued under subsection (a) shall be exempt from disclosure under section 552 of title 5. ( l ) Definitions. –For purposes of this section–

(1) the term "false claims law" means–

(A) this section and sections 3729 and 3732; and

(B) any Act of Congress enacted after the date of the enactment of this section which prohibits, or makes available to the United States in any court of the United States any civil remedy with respect to, any false claim against, bribery of, or corruption of any officer or employee of the United States;

(2) the term "false claims law investigation" means any inquiry conducted by any false claims law investigator for the purpose of ascertaining whether any person is or has been engaged in any violation of a false claims law;

(3) the term "false claims law investigator" means any attorney or investigator employed by the Department of Justice who is charged with the duty of enforcing or carrying into effect any false claims law, or any officer or employee of the United States acting under the direction and supervision of such attorney or investigator in connection with a false claims law investigation;

(4) the term "person" means any natural person, partnership, corporation, association, or other legal entity, including any State or political subdivision of a State;

(5) the term "documentary material" includes the original or any copy of any book, record, report, memorandum, paper, communication, tabulation, chart, or other document, or data compilations stored in or accessible through computer or other information retrieval systems, together with instructions and all other materials necessary to use or interpret such data compilations, and any product of discovery;

(6) the term "custodian" means the custodian, or any deputy custodian, designated by the Attorney General under subsection (i)(1);

(7) the term "product of discovery" includes–

(A) the original or duplicate of any deposition, interrogatory, document, thing, result of the inspection of land or other property, examination, or admission, which is obtained by any method of discovery in any judicial or administrative proceeding of an adversarial nature;

(B) any digest, analysis, selection, compilation, or derivation of any item listed in subparagraph (A); and

(C) any index or other manner of access to any item listed in subparagraph (A); and

(8) the term "official use" means any use that is consistent with the law, and the regulations and policies of the Department of Justice, including use in connection with internal Department of Justice memoranda and reports; communications between the Department of Justice and a Federal, State, or local government agency, or a contractor of a Federal, State, or local government agency, undertaken in furtherance of a Department of Justice investigation or prosecution of a case; interviews of any qui tam relator or other witness; oral examinations; depositions; preparation for and response to civil discovery requests; introduction into the record of a case or proceeding; applications, motions, memoranda and briefs submitted to a court or other tribunal; and communications with Government investigators, auditors, consultants and experts, the counsel of other parties, arbitrators and mediators, concerning an investigation, case or proceeding.