Qui Tam FAQs
The following FAQs apply specifically to the Federal False Claims Act. Individual state laws can differ from the federal law, especially with respect to the type of conduct covered, the amount the whistleblower can receive, and the statute of limitations. For a better understanding of how these jurisdictional differences can affect a potential claim, contact an attorney who is well-versed in FCA law and qui tam litigation.
What is a “qui tam” suit?
The term “qui tam” is an abbreviation of the Latin phrase “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” which means “he who brings an action for the king as well as for himself.” Ordinarily, the law does not let people sue for harm done to other people; if your friend was injured in a car accident, you cannot sue for the injury done to him because you are not the one who was injured.
The False Claims Act creates a very special exception to this rule by allowing ordinary people to sue for injuries done to the “king” (i.e. the government). Specifically, a qui tam suit permits private citizens to file a lawsuit on behalf of the government to recover taxpayer money that was taken from the government by fraud. Because the suit is brought in the name of the government, the government is the plaintiff, while the person bringing the suit is called the “Relator.” If the suit is successful, the Relator receives 15 percent to 30 percent of the money the government recovers. The remainder is returned to the government.
How does a qui tam suit work?
A qui tam suit is filed in the name of the United States, and as such the government has the option to intervene and take over the action. As a result, the Relator is required to provide the government with all of the information he or she has about the fraud before filing the actual lawsuit. The Relator then initiates the lawsuit by filing an official “complaint” with the court. This complaint is filed under “seal,” meaning that the existence of the lawsuit is a secret and the defendant does not know he or she has been sued. The seal lasts for 60 days, and is designed to give an opportunity for the government to investigate the merits of the suit. Because the government frequently requests additional time for its investigations, it is quite common for the suit to remain sealed for a year or more.
While the suit is under seal, it is vitally important that the Relator keep it secret. Telling anyone about the existence of a sealed suit could result in the suit being dismissed or the Relator being disqualified.
When the government completes its investigation, it decides whether to intervene. If it does intervene, then all responsibility for litigating the suit passes to the government and the Relator’s role is significantly reduced. Though he or she will usually continue to serve as an important witness and should be prepared to assist the government in any way possible. If the government does not intervene, then the Relator can choose to pursue the action himself, or dismiss the lawsuit.
If the government elects to intervene, or the Relator chooses to pursue the action himself, the complaint will be unsealed by the court and must be served on the defendant and the case will move forward like any other lawsuit. In either case, the seal will be lifted and the complaint will become a public document.
Who is qualified to be a Relator?
Almost anyone can be a Relator if they have the right information. The False Claims Act is intended to help the government combat fraud by encouraging and rewarding whistleblowers – people who expose fraud that the government might not otherwise have discovered. Thus, as a general rule, an individual cannot bring a qui tam suit that is based on publicly available information. There are, however, two exceptions to this rule. First, a whistleblower can still file a suit if he knew about the information before it became public and disclosed it to the government. Second, a person who discovered the information from some non-public source, and adds other important information to that which is publicly known, may also be able to file a qui tam suit.
The False Claims Act also bars qui tam suits brought by current or former members of the military against the military, if the suit is related to his or her military service. That is, if a person serving in the military discovers that the military itself has committed fraud, that person cannot file a qui tam action. Note that this exception does not apply to fraud by military contractors.
Can I file a qui tam anonymously?
Probably not. While there are certain circumstances in which a Relator can file as a John Doe, you should not expect to be able to do this. When you file a qui tam action, you must usually disclose your identity to the government, which is then free to disclose it to the defendant. During the period of the seal, the defendant is not supposed to know that it has been sued, but it will likely learn that it is being investigated by the government and may then be able to figure it out.
If you are particularly concerned about protecting your identity, your attorney may be able to help you minimize or delay its disclosure, but you should assume that the defendant will eventually learn your identity.
Can I sue for retaliation if my employer discovers that I’ve filed a qui tam?
Yes. The False Claims Act contains an anti-retaliation provision that bars an employer from discharging, demoting, harassing, or otherwise discriminating against an employee for filing a False Claims suit, or for taking action in furtherance of a suit. Remedies for retaliation include reinstatement, double back pay (with interest), compensation for “special damages” (loss of reputation, mental anguish, etc.), and attorney fees. In addition, you may have additional remedies under the laws of your state for wrongful termination or other employment laws.
You should note, however, that these remedies cannot actually prevent your employer from retaliating, they can only compensate you for your losses if it does.
How much money will the Relator receive? How is the Relator’s share determined?
If the government intervenes in a qui tam action, the Relator should receive between fifteen and twenty five percent (15%-25%) of the amount recovered by the suit. If the government does not intervene, the Relator will receive between twenty-five and thirty percent (25%-30%) of the amount recovered by the government under the suit.
In either case, the exact percentage of the Relator’s share is determined by the court. While different courts make this determination in different ways, most courts look to several factors including how much the Relator’s information contributed to the success of the case, the amount of assistance provided by the Relator and his counsel, the likelihood that the government would have discovered the fraud without the Relator, the Relator’s actions in trying to stop the fraud before reporting it, the size of the award, the hardships suffered by the Relator as a result of filing the action, and several other factors.
Is there a statute of limitations
Yes. In fact, qui tam suits may be subject to different statutes of limitations. Firstly, all qui tam suits have a six-year statute of limitations. This means that a suit must be filed within six years of the alleged fraudulent activity. If a company has been making false claims for many years, then the lawsuit will only apply to those false claims presented less than six years before it was filed.
The federal government can file a False Claims Act case within 10 years of the fraudulent activity, but only if it has known about the fraud for less than three years. That is, once the federal government learns about potential violations of the False Claims Act, it then has three years to file a suit. If it does, then that suit will apply to fraudulent conduct that occurred up to 10 years before it was filed. Some jurisdictions also allow a Relator who has missed the six year deadline to file a qui tam suit using the government’s 10-year statute of limitations.
There is also a separate statute of limitations covering the Relator’s right as an individual to sue for retaliation under the False Claims Act. It is now set by the statute at three years.
How long does a qui tam action take?
False Claims Act cases tend to be complex and time-consuming. A suit may remain under seal for a year or longer while the government completes its investigation, and it might then take several more before the case settles or gets to trial.
Can I file a qui tam case pro se (without an attorney)?
Probably not. Most courts have held that a person cannot file a qui tam case pro se, though some courts have held that this bar only applies if the government declines to intervene. The reason for this is that federal law says that only an attorney can appear in court on behalf of someone else. Thus, because a qui tam suit is filed on behalf of the United States, it can only be filed by an attorney.
However, non-qui tam cases can be filed pro se. As such, a person could file a suit against an employer for retaliation under section 3730(h).
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