Signed by Abraham Lincoln during the Civil War, and known as the Lincoln Law, the federal FCA allows anyone with credible evidence of fraud against the government to bring a whistleblower lawsuit against the offending entity in the name of the federal government. Since its inception, most states, and multiple municipalities across the country, have adopted mirror images of the federal FCA law.
Essentially, the FCA “qui tam” provision permits private citizens to collect a bounty when the government successfully resolves a qui tam case that is based upon the whistleblower’s allegations. A whistleblower is also known as a relater. The bounty is between 15-25% of the monies recovered, that is if the government participates in the action, or up to 30% when the relator and his/her attorneys successfully resolve the case without government assistance.
Be forewarned, this FCA process is lengthy (between 4-6 years on average), emotionally draining, and often comes with significant professional and personal sacrifices. In fact, the decision to become a whistleblower should never be made lightly or without the full understanding of the consequences of undertaking this journey. Thus, consulting with experienced qui tam whistleblower attorneys is essential and must be done at the onset to ensure the smoothest path through each phase on the way towards successfully resolving your qui tam case.
The FCA Process
Phase 1: Preparing and filing an FCA case
If you have a good-faith belief and corroborating evidence and/or documentation of fraud, then you will likely undergo the following process while seeking the bounty:
- You will need to retain a law firm and provide them with corroborating evidence and or documentation of potential FCA violations.
- The law firm assesses the cases and makes, in consultation with you, a decision on if, when, and where, to file a qui tam complaint.
- The qui tam complaint is drafted and filed under a court-ordered seal, meaning in secret, thus nobody besides you, your counsel, the court, and the government, are aware of the complaint and allegations.
- Copies of the complaint are given to the United States Department of Justice and the judge of the District Court assigned to the case.
- Additionally, a Disclosure Statement, which includes all relevant evidence or documentation regarding the fraud in your possession is turned over to the government for their review.
- The complaint initially remains under court-ordered seal for 60-days while the government assesses the complaint and disclosure statement. After that time, the Department of Justice may then file motions to keep the case sealed—typically for increments of six months-—while they investigate the allegations and work towards deciding whether to intervene in the case. Intervene means for the government to take over and civilly prosecute the case under the FCA. Historically if the government intervenes in a case, the chances of a successful resolution for the whistleblower is around 90%.
Phase II: Government Investigation and intervention decision
Upon receipt of the complaint and Disclosure Statement, the government initially assess the information and usually proceeds with the following steps:
- Government attorneys and investigators review your information. If your case has merit, an investigation is launched to determine the true size and scope of the fraud.
- Also, within that initial 60-day period, the government schedules a “Relator’s Meeting.” The “Relator’s Meeting” is where government attorneys and investigators interview you to assess your credibility as well as your allegations within the complaint.
- The government’s investigation can and often does include interviewing other witnesses, reviewing documents, and consulting with experts.
- All these steps lead to the Government’s decision on intervention.
The Department of Justice intervention/non-intervention decision:
- If the government decides to intervene, they will file a notice of intervention and assume the primary role of prosecuting the FCA case in federal district civil court.
- It is quite common for cases to settle at the intervention decision while the case is still under seal because the government usually wants to quickly resolve, if possible, the matter because litigation is time consuming and expensive for all parties.
- Sometimes, depending on the facts within the case, the government decides to pursue criminal charges against the defendant. In this scenario, the government will likely resolve the criminal case before finalizing the civil FCA case.
- Frequently, about 80% of the time, the government declines to intervene by filing a declination decision in court. At this point, you must decide whether to proceed without government participation or to file a voluntary notice of dismissal, thereby ending the case.
- Rarely, but possible, the government may choose to file in a court a motion to dismiss your case. The government considers multiple factors when determining whether to seek dismissal.
- Regardless of the government’s decision on intervention, the case is coming out from under seal at that point. This means your identity and allegations will become public.
- If the government declines to intervene, and you, along with your attorneys, decide to litigate the case, then each named defendant is required to be served with the complaint. This kicks off the litigation phase.
Phase III: Litigating FCA cases
If an FCA case is unsealed and there is neither a settlement nor case dismissal, then you will enter the litigation phase. Here, is how the litigation phase plays out:
- The named defendants are served with the complaint and they respond either through an answer or they file a Motion to Dismiss. Many FCA cases fail to get past a Motion to Dismiss because there are legal and or evidentiary defects that cause the court to grant the defense’s motion.
- However, should the case get past a Motion to Dismiss, the case then enters the discovery process.
- Discovery involves the exchange of relevant information between the parties. Information exchange comes in the form of documents and interviews, typically as depositions and or interrogatories.
- Additionally, both sides file motions to get the court to rule on certain legal issues, which is intended to shape how the trial is managed as well as what (including who can serve as witnesses, fact and/or expert and what documents or evidence) can be used by either side at trial.
- Throughout discovery, the court is likely urging, and in some cases, requiring, the parties to engage in good faith attempts at resolving the litigation via mediation. These efforts at mediation may or may not work, depending on too many factors to list here.
- If there is no resolution during discovery, at some point the court calls an end and sets a trial date.
- At this point, both sides file Motions for Summary Judgement. A Summary Judgement Motion is like a Motion to Dismiss, meaning that it can and often does end FCA cases due to a deficiency. The court may or may not grant the motion, depending on the facts and circumstances of each case.
- Usually, if the court grants a defense counsel’s Motion for Summary Judgement, the court will provide you and your attorneys the opportunity to amend the complaint to fix problems that led the court to grant the motion in the first place.
- However, if the court denies all Motions for Summary Judgement, then the case proceeds to trial whereat a verdict will be rendered and appeals may or may not be pursued.
Contact experienced qui tam Attorneys
The above information is intended to give you a general overview of how a “typical” FCA case is handled in each phase of the process. However, no two cases are alike thus, if 1) you possess knowledge of fraud against the United States government, 2) you have an interest in pursuing a bounty, and 3) you have specific questions about your case, give us at Morgan & Morgan a call so we can help you to decide if pursuing a qui tam case is right for you.
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