Qui Tam Actions

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 What is a Qui Tam Action?

“Qui tam” is a Latin phrase meaning, “the one who sues in this matter for the king as well as for himself.” Qui tam is a legal doctrine that allows citizens to file a claim or lawsuit against a person or entity that is defrauding the government. In the United States, such claims are authorized by the federal False Claims Act.

In addition, a majority of states have enacted state false claims. California, Indiana and Michigan, and Ohio are states that have specific laws providing protections for qui tam claimants relating to state government contracting.

What Is the Federal Civil False Claims Act?

The federal False Claims Act allows citizens to bring actions for fraud, deceit or misrepresentation against a wrongdoer who has filed a false claim for payment with the federal government. Because the statute requires that the person filing the qui tam lawsuit have evidence to prove the fraud, that person is usually affiliated with the wrongdoer.

The person might be an employee or someone else associated with a contractor who would have personal knowledge of what happened. The government has the right to intervene in the suit, but their participation is not required for the lawsuit to be successful.

What Activities Fall Under the Federal Statute?

The qui tam law is responsible for catching most of the government contractors who have engaged in defrauding or submitting deceitful claims to the government. Under the statute, the following activities are considered illegal and a person with evidence of such actions may file a qui tam claim:

  • Knowingly presenting or causing information to be presented to the government which makes a false or fraudulent claim for payment;
  • Knowingly using or causing information to be used that constitutes a false or fraudulent record or statement in order to obtain payment of a government claim;
  • Knowingly using or causing the use of a false record or statement with the purpose of concealing, avoiding, or decreasing an obligation to pay money or property to the government; and/or
  • Conspiring with others to do any of the actions listed above in order to get a fraudulent or false claim paid by the government.

Examples of these prohibited activities include the following:

  • Billing the federal government for more than should be charged for the services or goods rendered;
  • Submitting claims to the government for payment for goods or services that were never in fact rendered;
  • Making a false certification of a benefit in order to get a bill paid on your own behalf or a client’s.

Who Can File Qui Tam Claim?

Any person or entity that has evidence of fraudulent activity against a federal program, grant, or contract may file a lawsuit under the False Claims Act. However, if someone else with the same evidence has already done so, another person will not be able to bring a second suit.

There is, in addition, a public disclosure bar. This prohibits a qui tam claimant from bringing a False Claims Act lawsuit based on a fraud that has already been disclosed through public channels, unless the claimant is the original source of the information. An “original source” would be a person who has their own direct and independent knowledge of the information alleged and who has voluntarily provided the information to the government before filing their lawsuit.

What Should Be Included in My Qui Tam Claim?

The person who brings a qui tam suit must include the following elements in their complaint to ensure that it is complete and has the best chance of success:

  • State specific dates on which the fraudulent activity took place;
  • State the identities of the people within a company or organization who made the false statement or record or sent such record to the government;
  • Identify evidence in the person’s possession that shows the fraudulent activity; and
  • Specify how the person came to discover the fraudulent activity.

Where Does a Person File a Qui Tam claim?

The claim should be filed confidentially, under seal with the federal court within the jurisdiction in which the qui tam claimant lives. A copy of all documents filed must also be served on the U.S. Attorney General and the local U.S. Attorney’s Office in the same jurisdiction in which the claim is filed.

Because the court must lift the confidential seal, the qui tam claimant must not serve a copy or notify the defendant contractor of the filing until the court determines otherwise. Failure to comply with the confidentiality provisions can lead to dismissal of the case.

Are There Any Statutes of Limitations for Filing a Qui Tam Claim?

A qui tam claimant must file within 3 years of the government having knowledge or when they should have had knowledge of the false claim or within the 6 years of the actual false claim, whichever comes later. However, no claim can be filed more than 10 years after the false claim was made.

Can My Employer Retaliate Against Me for Filing a Qui Tam Claim?

The False Claims Act provides whistleblowers with certain protections for coming forward and filing claims. Companies are prohibited from discriminating against the claimant if they are an employee. The employer may not harass, demote or terminate the employment of a person who files a lawful qui tam complaint under the Act. .

However, there are statutory time requirements so the person must file within the stated timeframe to be protected. They must also have sufficient evidence to pursue the claim in order to gain protection. The claim must be filed in good faith.

If the employer does retaliate, the claimant may be entitled to:

  • Double back pay;
  • Reinstatement to their former position, if they were fired; and/or
  • Compensation for damages including attorney’s fees and the costs of litigation.

What Are the Penalties for Those Found Guilty of a Qui Tam Action?

Defendants found guilty can face a civil penalty of up to three times the dollar amount of the amount they took through defrauding the government. They may also be subjected to additional criminal penalties in the amount of $5,000 to $10,000 for each false claim.

Can I Receive a Reward for My Qui Tam Action?

If money is recovered from the defendant either by court order or through settlement, the qui tam claimant may be eligible for 15 to 30% of the money recovered. However, the person must have filed a qui tam claim to get a reward. Notifying the government of the fraud is not enough to recover.

Again, the FCA also provides a wide range of damages to claimants who experience retaliation by their employers. Among the damages that might be recovered are compensatory damages and double back pay. There is no cap on the amount of compensatory damages that can be awarded. Courts can also award successful whistleblowers under the False Claim Act front pay for lost future income. Also, there are other federal and state whistleblower protection laws that may provide additional remedies, including punitive damages.

Can a Lawyer Help Me with My Qui Tam Lawsuit?

A workplace lawyer can assist you in evaluating any evidence you may have uncovered of a fraud perpetrated on the federal government. Moreover, a lawyer can help you draft the appropriate complaint. If you have been retaliated against by your employer for whistleblowing or filing a qui tam action, a lawyer can help you recover any benefits to which you are entitled under the act.

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