In any civil action, a concept known as a statute of limitations applies to limit plaintiffs from filing a lawsuit based on incidents occurring more than a set number of years in the past. For example, personal injury cases carry a two-year statute of limitations in several states (e.g., California, Texas, Pennsylvania) while actions on debt or breach of contract may carry a seven- or ten-year statute of limitations. Statutes of limitation are set by every state to address state-law claims, as well as within federal statutes to control the amount of time within which a plaintiff may file in federal district court.
Within the purview of the False Claims Act, a qui tam plaintiff must file his claim within six years from the date of the alleged incident of fraud. If the plaintiff waits too long, the defendant will assuredly move to dismiss the action based on the statute of limitations. However, there are certain factors that, when present in a case, work to “toll” a statute of limitations by adding additional time to the deadline within which the plaintiff must file. Tolling can include periods of incompetence, absence from the jurisdiction, or incarceration.
Tolling periods may also be implemented by statute. In the 1940’s, Congress enacted the Wartime Suspension of Limitations Act to extend the statute of limitations for causes of action involving fraud or attempted fraud against the United States. In order for the WSLA to apply, the following elements must be present:
- The United States must be at war or Congress has enacted a specialized authorization for the use of Armed Forces, and;
- The cause of action involves fraud or attempted fraud against the U.S, or;
- The cause of action involves any misdeed committed in the handling of U.S. property, or;
- The cause of action involves misconduct in the negotiation, procurement, award, performance, payment for, interim financing, cancellation, or other termination or settlement, of any contract, subcontract, or purchase order which is connected with or related to the prosecution of the war.
If a plaintiff’s action meets the above criteria, which fit squarely within the purview of the False Claims Act, the WSLA operates to add five additional years within which the plaintiff can file his claim after the termination of hostilities.
Application of WSLA to FCA in United States ex rel. Carter v. Halliburton Co.
The language of the WSLA does not expressly refer to the FCA or lawsuits commenced thereunder. Therefore, a number of unanswered questions have emerged with regard to the application of the WSLA to plaintiffs interested in filing whistleblower lawsuits based on incidents occurring during both the Iraq and Afghanistan wars. In Halliburton, the Fourth Circuit reversed the District Court’s holding that the WSLA does not apply to civil matters and is meant solely to address statute of limitations problems with criminal matters involving fraud against the government. On appeal, the Fourth Circuit held just the opposite, allowing a relator to file his qui tam action alleging fraud by a military contractor responsible for providing water purification services during the Iraq War despite the fact that the six-year statute of limitations had expired.
The U.S. Supreme Court opted to review the case by granting a writ of certiorari and inviting the Solicitor General to issue an opinion. To date, no opinion has been issued and the Supreme Court’s interpretations of the laws are presumably forthcoming.
If you are aware of defense contracting fraud or have questions about the whistleblower lawsuit process, we encourage you to contact an experienced and reputable whistleblower attorney today.