An Act To Recoup Health Care Funds through the Maine False Claims Act
Maine Legislature, Session 123, LD 1187
Committee: Health and Human Services
Sponsors: BRAUTIGAM, CANAVAN, CONOVER, HINCK, MILLS, PERRY, PRIEST
Amends: 22 MRSA §15

Legislative Document 
No.nS7 
H.P.868 
House of Representatives, March 7, 2007 
An Act To Recoup Health Care Funds through the Maine False 
Claims Act 
Reference to the Committee on Health and Human Services suggested and ordered printed. 
Presented by Representati ve TREAT of Farmingdale. 
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MILLICENT M. MacFARLAND 
Clerk 
Cosponsored by Representatives: BRAUTIGAM of Falmouth, CANAVAN of Waterville, 
CONOVER of Oakland, HINCK of Portland, MILLS of Farmington, PERRY of Calais, 
PRIEST of Brunswick. 
Prlllted Oil reqdeJ paper 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 22 MRSA §15, as amended by PL 1995, c. 191, §§1 to 4, is further 
amended by adding at the end a new paragraph to read: 
Civil liability under this section is independent of liability under section 15-A. 
Sec. 2. 22 MRS A §15-A is enacted to read: 
§15-A. Maine False Claims Act 
1. Short title. This section is known and may be cited as "the Maine False Claims 
Act." 
2. Definitions. As used in this section, unless the context otherwise indicates, the 
following terms have the following meanings. 
A. "Claim" means a request or demand for money, property or services made to an 
employee, officer or agent of the State or to any contractor, grantee or other recipient, 
whether under contract or not, if any portion of the money, property or services 
requested or demanded issued from or was provided by the State, or if the State will 
reimburse the contractor, grantee or other recipient for any portion of the money, 
property or services requested or demanded. 
B. 
"Employer" means any natural person, corporation, firm, association, 
organization, partnership, business or trust or an entity affiliated with the State 
involved in a nongovernmental function, including a postsecondary educational 
institution or a hospital. 
C. "False claims action" means a court action brought under this section. 
D. "Hospital" means a state mental health institute as defined in Title 34-B, section 
3801, subsection 9 and a hospital licensed under chapter 405. 
E. "Knowing" and "knowingly" mean that a person, with respect to information: 
(1) Has actual knowledge of the information; 
(2) Acts in deliberate ignorance of the truth or falsity of the information; or 
(3) Acts in reckless disregard of the truth or falsity of the information. 
Proof of specific intent to defraud is not required. 
F. 
"MaineCare program" means the program of health coverage provided under 
chapter 855. 
G. "Original source" means a person who has direct and independent knowledge of 
the information on which allegations are based and has voluntarily provided the 
information to the State before filing an action under this section based on the 
information. 
H. 
"Person". means a natural person, corporation, firm, association, organization, 
partnership, business or trust. 
Pa~e I - 123LR1954(Ol)-1 
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I. "Plaintiff' means the relator and, if the Attorney' General elects to intervene and 
prosecute the action, the State or both as determined in the action. 
J. "Postsecondary educational institution" means the University of Maine System, 
the Maine Maritime Academy and the Maine Community College System. 
K. 
"Proceeds" means the amount awarded to the State against the defendant, 
including but not limited to damages, civil penalties, payments for costs of 
compliance and other economic benefit realized by the State as a result of the action. 
L. "Qui tam action" means an action brought by a relator for the person and for the 
benefit of the State in the name of the State and, at the election of the Attorney 
General, in which the State is also a plaintiff. 
M. "Relator" means a person who brings a qui tam action for a violation of this 
section for the person and for the benefit of the State in the name of the State. 
3. Prohibited acts. False claims against the State with regard to the MaineCare 
program are prohibited and are penalized in accordance with this subsection. 
A. 
A person who commits any of the acts listed in this paragraph is liable for 
damages, costs and penalties as provided in this subsection. 
(I) A person is liable under this subsection if the person: 
(a) Knowingly presents or causes to be presented to any employee, officer or 
agent of the State or to any contractor, grantee or other recipient of state 
funds a false or fraudulent claim for payment or approval; 
eb) Knowingly makes, uses or causes to be made or used a false record or 
statement to conceal, avoid or decrease an obligation to payor transmit 
money or property to the State; 
ec) Conspires to defraud the State by getting a false claim allowed or paid, or 
conspires to defraud the State by knowingly making, using or causing to be 
made or used a false record or statement to conceal, avoid or decrease an 
obligation to payor transmit money or property to the State; 
(d) Has possession, custody or control of public property or money used or 
to be used by the State and knowingly delivers or causes to be delivered less 
property than the amount for which the person receives a certificate or 
receipt; 
(e) Is authorized to make or deliver a document certifying receipt of property 
used or to be used by the State and knowingly makes or delivers a receipt that 
falsely represents the property used or to be used; 
m Knowingly buys, or receives as a pledge of an obligation or debt, public 
property from any person who lawfully may not sell or pledge the property; 
(g) Knowingly makes, uses or causes to be made or used a false record or 
statement to conceal, avoid or decrease an obligation to payor transmit 
money or property to the State; or 
(h) Is a beneficiary of an inadvertent submission of a false claim to an 
employee, officer or agent of the State or to any contractor, grantee or other 
recipient of state funds, subsequently discovers the falsity of the claim and 
fails to disclose the false claim to the State within a reasonable time after the 
discovery of the false claim. 
(2) Liability to the State may be assessed against a person for a violation of this 
paragraph: 
(a) For damages in the amount of 3 times the amount of damages that the 
State sustained because of the act; 
(b) For the costs of a qui tam action brought to recover any penalties and 
damages; and 
(c) For a civil penalty of not less than $5,000 and not more than $10,000 for 
each violation. 
B. A court shall assess damages and civil liability for a person who commits an act 
in violation of this subsection of at least 2 times the amount of damages that the State 
sustains because of the act of the person, except that the court may not assess a civil 
penalty if the court finds that: 
(1) The person who committed the violation furnished officials of the State who 
are responsible for investigating false claims violations with all information 
known to the person about the violation within 30 days after the date on which 
the person first obtained the information; 
(2) The person fully cooperated with any investigation by the State; and 
(3) 
At the time the person furnished the State with information about the 
violation, no criminal prosecution, qui tam action or administrative action had 
commenced with respect to the violation and the person did not have actual 
knowledge of the existence of an investigation into the violation. 
C. A person is liable to the State under this section for the acts of that person's agent 
when the agent acted with apparent authority, regardless of whether the agent acted, 
in whole or in part, to benefit the person and regardless of whether the person 
adopted or ratified the agent's claims, representation, statement or other action or 
conduct. 
D. This subsection does not apply to claims, records or statements made to the State 
under Title 36. 
4. False claims action; qui tam action. A false claims action may be brought 
against a person who violates subsection 3 in accordance with this subsection and 
subsections 5 to 7. 
A. The Attorney General shall diligently investigate a violation of this section. If the 
Attorney General finds that a person has violated or is violating this section, the 
Attorney General may bring a false claims action under this subsection against the 
person or intervene in a qui tam action brought by a person under paragraph B. 
B. A private person may bring a qui tam action for a violation of subsection 3. 
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(I) Once filed, the qui tam action may be dismissed only with the written 
consent of the court, after taking into account the best interest of the parties 
involved and the public purpose of this section. 
(2) The relator shall serve on the Attorney General a copy of the complaint and 
written disclosure of substantially all material evidence and information the 
relator possesses as provided in the Maine Rules of Civil Procedure, Rule 5. 
(3) The complaint must be filed in camera and must remain under seal for at 
least 60 days and may not be served upon the defendant until the court so orders. 
(4) The Attorney General may elect to intervene and proceed with the action on 
behalf of the State within 60 days after the Attorney General receives both the 
complaint and the material evidence and information from the relator. 
(5) 
The Attorney General may, for good cause shown, move the court for 
extensions of time during which the complaint remains under seal under 
subparagraph (3) and the Attorney General may elect to intervene and proceed 
with the action under subparagraph (4). A motion under this subparagraph must 
be supported by an affidavit or other submission in camera. 
(6) Before the expiration of the 60-day period under subparagraph (4) or any 
extensions ordered under subparagraph (5), the Attorney General shall: 
(a) Proceed with the action by intervention as plaintiff, in which case the 
action must be conducted by the Attorney General as the attorney for the 
plaintiff; or 
(b) Notify the court that the Attorney General declines to take over the 
action, in which case the relator has the right to conduct the action as 
plaintiff. 
(7) The defendant is not required to respond to any complaint filed under this 
paragraph until after the complaint is unsealed and served upon the plaintiff as 
provided in the Maine Rules of Civil Procedure, Rule 5. 
(8) When a person brings an action as relator under this paragraph, a person 
other than the Attorney General on behalf of the State may not intervene or bring 
a related action based on the facts underlying the action while the action is 
pending. 
C. The rights of the parties to a qui tam action under this subsection are determined 
under this paragraph. 
(I) If the Attorney General elects not to intervene and proceed with the action, 
the relator has the right to conduct the action as plaintiff. 
(a) 
At the request of the Attorney General, and upon payment by the 
Attorney General of the cost of transcription, copying and mailing, the relator 
shall serve upon the Attorney General copies of all pleadings filed in the 
action. 
(b) The court, upon a showing of good cause and without limiting the status 
and rights of the relator, may permit the Attorney General to intervene after 
the expiration of the 60-day time period under paragraph B, subparagraph (4) 
and any extension ordered under paragraph B, subparagraph (5). 
(2) If the Attorney General intervenes and proceeds with the qui tam action, the 
Attorney General has the primary responsibility for prosecuting the action and is 
not bound by any acts of the relator. 
(3) If the Attorney General intervenes and proceeds with the qui tam action, the 
relator has the right to continue as a party to the action, subject to the limitations 
of th is paragraph. 
(a) The Attorney General may move to dismiss the action for good cause 
notwithstanding the objections of the relator if the relator has been notified 
by the Attorney General of the filing of the motion and the court has 
provided the relator with an opportunity to oppose the motion and present 
evidence at a hearing. 
(b) 
The Attorney General may settle the action with the defendant 
notwithstanding the objections of the relator if the court determines, after a 
hearing at which the relator has had an opportunity to present evidence, that 
the proposed settlement is fair, adequate and reasonable under all of the 
circumstances. 
(c) Upon a showing by the Attorney General that unrestricted participation 
during the course of the litigation by the relator would interfere with or 
unduly delay the prosecution ofthe case by the Attorney General or would be 
repetitious, irrelevant or for purposes of harassment, the court may, in its 
discretion, impose limitations on the participation of the relator, including but 
not limited to: 
(i) Limiting the number of witnesses the relator may call; 
(ii) Limiting the length of the testimony of the witnesses called by the 
relator; and 
(iii) Limiting the relator's cross-examination of witnesses. 
(d) Upon a showing by the defendant that unrestricted participation during 
the course of the litigation by the relator would be for purposes of harassment 
or would cause the defendant undue burden or unnecessary expense, the 
court may limit the participation of the relator in the litigation. 
(4) Whether or not the Attorney General intervenes and proceeds with the action, 
upon a showing by the Attorney General that certain actions of discovery by the 
relator would interfere with the Attorney General'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. 
A showing under this 
subparagraph must be conducted in camera. The court may extend a 60-day stay 
granted under this subparagraph upon a further showing in camera that the 
Attorney General has pursued the criminal or civil investigation or proceedings 
with reasonable diligence and any proposed discovery in the qui tam action will 
interfere with the ongoing criminal or civil investigation or proceedings. 
A 
motion with regard to discovery in a qui tam action must be filed with the court 
in accordance with the Maine Rules of Civil Procedure, Rules 26 to 37, as 
applicable to the action. 
(5) Notwithstanding the provisions of paragraph B, the Attorney General may 
elect to pursue its claim through any alternate remedy available to the State, 
including any administrative proceeding to determine a civil penalty or any 
action under section 15. If an alternate remedy is pursued in another proceeding, 
the relator has the same rights in such proceeding as the relator would have had if 
the action had continued under this subsection. 
For the purposes of this 
subparagraph, a finding or conclusion is final if it has been finally determined on 
appeal to the appropriate court of the State if all time for filing such appeal with 
respect to the finding or conclusion has expired or if the finding or conclusion is 
not subject to judicial review. 
D. If the Attorney General intervenes and proceeds with a qui tam action brought by 
the relator and a judgment is entered in favor of the plaintiff or a settlement is entered 
in the action, the court shall enter an order as follows. 
(l) Except as provided in subparagraph (2), the court may award the relator at 
least 15% but not more than 25% of the proceeds of the action or settlement of 
the claim, including damages, civil penalties, payments for costs of compliance 
and other economic benefit realized by the State as a result of the action, 
depending on the extent to which the relator and the counsel for the relator 
contributed to the prosecution of the action. Any payment to the relator under 
this subparagraph must be made from the proceeds. 
(2) If the court finds that the action is based primarily on disclosures of specific 
information, other than infornlation provided by the relator, relating to allegations 
or transactions specifically in a criminal, civil or administrative hearing or in a 
legislative or administrative report, hearing, audit or investigation or from the 
news media, the court may award the relator such sums as it considers 
appropriate, but in no case more than 10% of the proceeds, taking into account 
the significance of the information and the role of the relator in advancing the 
case to litigation. Any payment to the relator under this subparagraph must be 
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made from the proceeds. 
(3) Whether or not the Attorney General intervenes and proceeds with the action, 
if the court finds that the action was brought by a relator who planned and 
initiated the violation of subsection 3 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 that the person would otherwise receive under this 
paragraph. The court shall take into account the role of the relator in advancing 
the case to litigation and any relevant circumstances pertaining to the violation. 
If the relator is convicted of criminal conduct arising from the role of the relator 
in the violation of subsection 3, the relator must be dismissed from the qui tam 
action and may not receive any share of the proceeds of the action. Dismissal of 
the relator under this subparagraph does not prejudice the right of the State to 
continue the action as plaintiff. 
( 4) If the Attorney General does not intervene and proceed with the action, the 
relator must receive an amount that the court determines to be reasonable for 
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collecting the civil penalty and damages. The amount must be at least 25% but 
not more than 30% of the proceeds of the action or settlement and must be paid 
out of the proceeds, which include damages, civil penalties, payments for costs of 
compliance and other economic benefit realized by the State as a result of the 
action. The relator must also receive an amount for reasonable expenses that the 
court determines to have been necessarily incurred, plus reasonable attorney's 
fees and costs. 
All expenses, fees and costs must be awarded against the 
defendant. 
(5) The court shall order payment of the reasonable expenses of the relator that 
the court finds to be necessarily incurred, plus reasonable attorney's fees and 
costs. All expenses, fees and costs must be awarded against the defendant. 
(6) No liability may be incurred by the State, the department or the Attorney 
General for any expenses, attorney's fees or other costs incurred by any person in 
bringing or defending an action under this section. 
(7) All money collected from the defendant in an action under this section, with 
the exception of money payable under this paragraph to another person, must be 
paid to the State Controller for credit to the False Claims Act Fund under 
subsection 8. 
E. The following limitations apply to qui tam actions. 
(1) No court has jurisdiction over an action brought under this section against a 
member of the Legislature, a judge of the District Court or a justice of the 
Superior Court or Supreme Judicial Court, or a senior executive branch official if 
the action is based on evidence or infonnation known to the State when the action 
was brought. 
(2) No court has jurisdiction over an action under this subsection based upon the 
public disclosure of allegations or transactions in a criminal, civil or 
administrative hearing, audit or investigation or from the news media, unless the 
action is brought by the Attorney General or the relator is the original source of 
the information. 
(3) No court has jurisdiction over an action brought by a former or present 
member of the Armed Forces of the United States under this section against 
another member of the armed forces arising out of that other member's service in 
the armed forces. 
(4) A person may not bring an action under this section if the action is based 
upon allegations or transactions that are the subject of a civil suit or an 
administrative civil penalty proceeding in which the State is already a party. 
(5) Upon motion of the Attorney General, the court may, in consideration of all 
the equities, dismiss a relator as plaintiff if the elements of the actionable false 
claims alleged in the complaint have been publicly disclosed specifically in the 
news media or in a publicly disseminated governmental report at the time the 
complaint is filed. 
F. The State is not liable for the expenses, attorney's fees or costs incurred by a 
relator in an action under this section. 
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G. In the furtherance of a qui tam action, the provisions of this paragraph apply as 
protections for employees. An employee who is discharged, demoted, suspended, 
threatened, harassed or in any other manner discriminated against in the tenDS and 
conditions of employment by the employee's employer because of lawful acts done 
by the employee on behalf of the employee or others in furtherance of an action under 
this section, including investigation for, initiation of, testimony for or assistance in an 
action filed or to be filed under this section, is entitled to all relief necessary to make 
the employee whole. Relief under this paragraph includes reinstatement with the 
same seniority status that the employee would have had but for the discriminatory 
action of the employer, 2 times the amount of back pay, interest on the back pay and 
compensation for any special damages sustained as a result of the employer's 
discriminatory action, including litigation costs and reasonable attorney's fees. An 
employee may bring an action in Superior Court in the county in which the employer 
is located or the county of residence of the employee. 
5. Qui tam action procedures. The following provisions apply to a qui tam action 
under subsection 4. 
A. An action under subsection 4 may not be brought more than 6 years after the date 
on which the violation was committed, or 3 years after the date when facts material to 
the right of action are known or reasonably should have been known by the state 
official charged with the responsibility to act in such circumstances, but in no event 
more than 10 years after the date on which the violation is committed, whichever 
occurs last. 
B. An action under subsection 4 may be brought for activity prior to the effective 
date of this section ifthe limitation period in paragraph A has not ended. 
C. An action under subsection 4 may be brought by the relator in the county in which 
the relator resides, in the county in which the defendant has its principal place of 
business or in the Superior Court of Kennebec County. 
D. In anv action brought under subsection 4 the State or the relator is 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, a guilty verdict rendered in a 
criminal proceeding charging false statements or fraud, whether upon a verdict after 
trial or upon a plea of guilty or nolo contendere, estops the defendant from denying 
the essential elements of the offense in any action that involves the same transaction 
as in the criminal proceeding and that is brought under subsection 4. 
6. Civil investigatory demands. In an investigation of a violation under subsection 
3, the provisions of Title 5, section 211 apply to civil investigatory demands and to 
examination of books, records, papers and memoranda of whatever nature and persons 
having knowledge regarding those materials. 
7. Applicable rules of civil procedure. The Maine Rules of Civil Procedure apply 
to all aspects of service, subpoena power, discovery and court procedure of an action filed 
pursuant to subsection 4 unless inconsistent with the provisions of this section. 
8. False Claims Act Fund. There is established within the department the False 
Claims Act Fund to receive funds collected as a result of actions prosecuted under this 
section and to provide funding for investigatory, enforcement and litigation expenses 
within the department related to this section. The False Claims Act Fund is a non lapsing 
fund dedicated to the purposes ofthis section. 
9. Remedies under other laws; severability of provisions; liberality of legislative 
construction; adoption of legislative history. The provisions of this section are not 
exclusive. The remedies provided for in this section are in addition to any other remedies 
provided for under section 15, in any other law or available under common law. If any 
provision of this section or the application thereof to any person or circumstance is held 
to be unconstitutional, the remainder of the section and the application of the provision to 
other persons and circumstances is not affected thereby. This section must be liberally 
construed and applied to promote the public interest. 
This section also adopts the 
congressional intent behind the federal False Claims Act, 31 United States Code, Sections 
3729 to 3733, including the federal False Claims Amendments Act of 1986. 
SUMMARY 
This bill enacts the Maine False Claims Act in order to protect the state and federal 
governments against false and fraudulent claims under the Medicaid program known in 
the State as the MaineCare program under the Maine Revised Statutes, Title 22, chapter 
855. This bill provides authorization for actions, referred to as qui tam actions, brought 
by a person for the person and for the State in the name of the State. This bill designates 
the person who brings the qui tam action as the relator. This bill provides protection from 
discrimination for an employee who participates in a qui tam action in furtherance of the 
action. This bill provides possible recoveries for the relator in addition to recoveries for 
the State. This bill establishes the False Claims Act Fund to receive the proceeds payable 
to the State as a result of false claims litigation. 
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