June 12, 2018 False Claims Act Information
Does a Qui Tam Relator Need to Identify Specific False Claims Submitted to the Government?
Under the False Claims Act, a whistleblower bringing a qui tam complaint must allege his/her claims with particularity under Federal Rule of Civil Procedure 9(b). Under Rule 9(b), plaintiffs (including False Claims Act whistleblowers) must plead the “who, what, when, where, and how” of the alleged misconduct. But does a qui tam lawsuit need to identify specific false claims and facts that show those specific claims were actually submitted to the government?
Read more about the life of a whistleblower qui tam lawsuit and why you want the government to intervene.
Federal Courts of Appeals Have Issued Conflicting Rulings on the Requirements for Bringing a Qui Tam Complaint
Federal Circuit Courts of Appeals have issued conflicting opinions on whether a qui tam whistleblower must, in order to survive a motion to dismiss, identify specific false claims submitted to the government for payment, or whether instead the complaint can merely cite facts that support an inference that false claims were submitted.
In the First, Fifth, Seventh and Ninth Circuits, a qui tam relator’s complaint will satisfy Rule 9(b) so long as it alleges particular details of a scheme to submit false claims together with evidence supporting an inference that claims were actually submitted, even when the relator’s complaint does not identify any specific claims submitted to the government for payment. In these circuits, it is much easier for a FCA relator to avoid dismissal in a case where the government has declined to take over the litigation.
In the Fourth, Sixth, Eighth and Eleventh Circuits, a qui tam complaint must identify specific claims submitted to the government for payment in order to satisfy Rule 9(b). Under such a standard, even if a whistleblower has detailed knowledge of a fraudulent scheme, it may be difficult to identify specific claims submitted to the government for payment. For example, an employee of a health care company or hospital might have knowledge of a fraudulent scheme at the company or hospital but, because the employee was not in the accounting department and never involved in the actual submission of claims to the government, he or she may not be able to identify actual, specific claims that were submitted to the government pursuant to that scheme.
The United States Department of Justice Has Argued That a Qui Tam Relator Does Not Have to Identify Specific False Claims in a Whistleblower Lawsuit
In a case addressing the current circuit split on the issue of whether a qui tam relator must identify specific claims in order to satisfy Rule 9(b), the United States Department of Justice recently argued that the correct rule is that a qui tam complaint satisfies Rule 9(b) if it “contains detailed allegations supporting a plausible inference that false claims were submitted to the government, even if the complaint does not identify specific requests for payment.”
The Supreme Court recently declined to hear a case that could have led to a resolution of the Circuit Court split. As a result, potential whistleblowers will need to be aware of the law of their particular Circuit before bringing a qui tam lawsuit.