Whistleblower Asks Ninth Circuit to Reinstate Him as Relator

We reported earlier this month about a $19 million settlement in a case involving the submission of fraudulent overtime work hours under a contract for environmental clean-up.  The settlement covered both the civil and criminal sanctions against CH2M Hill Hanford Group Inc. As explained in further detail in this article, the District Court ruled that the relator in the case was barred from collecting his award under the False Claims Act based on his role in the fraudulent cover-up. The relator has since appealed this ruling to the Ninth Circuit Court of Appeals, arguing that his role in the misconduct should not preclude him from recovering his share of the $19 million settlement – which  under FCA provisions can be as much as one-quarter, or $4.75 million.

CH2M Hill

Image from ops.fhwa.dot.gov

The False Claims Act Bars Qui Tam Awards for Any Whistleblower Involved in the Fraud

To better understand the central issues in U.S. v. CH2M Hill, it helps to explore the provisions of the federal FCA giving rise to the District Court’s decision to dismiss the relator from the case. Under 31 U.S.C. § 3730(d)(3), it is within a court’s discretion to reduce or eliminate a qui tam plaintiff’s award if the court finds action was “brought by a person who planned and initiated the violation.” If the relator is convicted of criminal violations for conduct arising from the violation, the court has no choice but to dismiss the relator who is then not permitted to recover any share of the award received by the United States government.

Qui Tam Plaintiff Pleads His Case

In May of this year, a Washington District Court dismissed the relator from the CH2M Hill case under 31 U.S.C. § 3730(d)(3). The relator filed his appeal with the Ninth Circuit earlier this month, pleading that his involvement in the fraud was minimal and, once discovered, he revealed the conduct to the U.S. government immediately. Moreover, the appellant accused the District Court of dismissing him for the “stated purpose” of depriving him of the proceeds of the action. Pointing to the language of § 3730(d)(3) the relator asserted that his conduct was far from planning and/or initiating the violation. In fact, as the relator contends in his brief, the Office of Inspector General was aware of fraud prior to his cause of action but believed it to be minimal, involving a mere handful of employees. In other words, without the relator’s efforts to reveal the true expansiveness of the employee timecard fraud, the U.S. government may have unknowingly surrendered exponentially more money under its contract with CH2M than originally thought.

Whistleblowers Should Seek Professional Counsel if Faced With Likely Misconduct

As you read this, you may be concerned that your awareness of possible fraud or misconduct will preclude you from commencing and participating in a qui tam lawsuit involving your employer. However, if you believe your employer is running afoul of its duties and responsibilities under a government contract, you should meet with a reputable and experienced whistleblower attorney right away. The case described above is not typical of most qui tam lawsuits and many relaotrs go on to receive compensation and awards for their efforts of up to 25 percent.

By | 2018-03-26T10:39:48+00:00 September 19th, 2013|False Claims Act Legal News|