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Qui Tam 2020 is the third annual conference of the Federal Bar Association's Qui Tam Section, for which TELG's Scott Oswald serves as chair. The two-day event will tackle some of the hottest topics in False Claims Act litigation, with panels featuring attorneys from both sides of the aisle, along with government prosecutors, agency representatives, and subject-matter experts.
Here Scott discusses government-initiated dismissals of qui tam complaints under the FCA — known as (c)(2)(A) dismissals — with Derek M. Adams of Feldesman Tucker Leifer Fidell LLP, who'll be speaking in a panel on the topic on Day Two of the conference.
This video interview by TELG managing principal R. Scott Oswald was published by The Employment Law Group, P.C. on January 21, 2020.
Qui Tam 2020 Panel Preview: Government-Initiated (c)(2)(A) Dismissals of Qui Tam Complaints
» Click here for registration and full details on Qui Tam 2020
(Transcribed and edited lightly by The Employment Law Group)
R. Scott Oswald: [Addressing camera] Welcome back to our continuing conversation with our moderators and speakers in anticipation of the Qui Tam Conference, which is in February here in Washington, D.C. And today we have Derek Adams, and [turning to Adams] Derek is a partner at Feldesman Tucker Leifer & Fidell.
Derek M. Adams: That’s right.
Oswald: Did I get that right?
Adams: You did.
Oswald: Okay, thank you. Your panel is on an emerging topic for sure, and that is (c)(2)(A) dismissal. Can you just explain for everyone watching what that is — and the power that the Department of Justice has to dismiss a qui tam case?
Adams: Sure. Thanks, Scott.
So under the False Claims Act, the Department of Justice … has the ability to move to dismiss, affirmatively move to dismiss. In most cases, as you know, there’s an investigation that occurs and then the DOJ makes the decision: Are we going to intervene in the case or are we going to decline? And the relator has the ability to then proceed with the case.
In a small percentage of cases, the DOJ [may] actually step in and say: We don’t want the relator to move forward with the case, [so] we are going to affirmatively move to dismiss the case under a provision that’s referred to in the statute under (c)(2)(A).
Oswald: And my guess is that most relators and their counsel aren’t too happy when that happens.
Adams: That is correct — especially if you are, you know, a year after the [original] intervention decision. It’s been coming up more recently: There’s the Granston memo that came out in the beginning of 2018, and there’s been a lot of attention the last couple of years about when the DOJ is using [dismissal], whether they’re using it more often, and how the landscape has changed as a result of that.
Oswald: So Mike Granston spoke to us last year at the Qui Tam Conference. One of the points he made was that his memo was really just a codification of what had already been the policy of DOJ. It was pretty much business as usual. Is that right? Has it been business as usual?
Adams: So, I agree. I agree with Michael. I was in [the] Civil Frauds [division] prior to that and I had (c)(2)(A) cases. I litigated (c)(2)(A) cases. I brought (c)(2)(A) decisions — (c)(2)(A) motions. So it was a tool that we used in certain circumstances.
I think the big change that happened with the memo and movement in 2018 was more awareness among all of the US Attorney’s offices that this is something that they should consider, in certain circumstances, at the point of intervention. So I don’t think it was a change in policy so much as a change in practice, right? It was a little bit more awareness among the DOJ that this is a tool to consider — and that there are good reasons to use it in certain circumstances.
Oswald: Maybe one of the fears on the relators’ side is that agencies now will have some say in this — an agency maybe that is slightly embarrassed by the fact that these mis-billings have occurred. What does the memo say about that, and how has that played out since the memo?
Adams: Sure. So the memo has now been integrated — pieces of it — into the Justice Manual. So there’s factors within the Justice Manual that DOJ will look at and determine if they’re going to move to dismiss a case, and what … things they take into account. The effect on the agency is certainly one of the factors that they look at, and [whether it will] potentially affect agency programs, for example, if they let this case proceed with the relator bringing the case.
In terms of potential embarrassment of an agency, I would say materiality is such a big issue especially after Escobar, that there’s more awareness from the defense side about obtaining evidence during litigation that might help to show that the alleged fraud was not material. And if there are agency witnesses who knew about it at the time — [so that] the government is going to have a very difficult time establishing materiality — that might be a reason that, at the time of intervention, they may consider moving to dismiss rather than letting the case proceed for two years and then having that come out with an agency witness, for example.
Oswald: So if I’m in the audience and I’m watching the panel and soaking it all in, what can I expect?
Adams: We’re really going to focus on separating fact from fiction. There’s been so much written about (c)(2)(A) over the last two years, and there’s a view that this is widespread — that it’s happening all over the place and, potentially, DOJ [is] using it improperly to move to dismiss when they shouldn’t be. [But] if you look at the raw numbers of cases that have come out, even in 2018-2019, they’re not that much compared to the number of False Claims Act cases that are brought. So we’re going to talk about things like that.
We’re also going to talk about strategic ways from the relator’s side, the defense side, and from DOJ’s perspective — how each party can potentially utilize (c)(2)(A) for their advantage. So, defendants: What are the arguments you can make to get DOJ to consider moving to dismiss a case? Is it saying to them, “We are going to subpoena every witness at the agency and you’re going to be buried in documents for two years”? Or is it doing something more strategic?
And from the relator side, what are the things you can do to try to work it out with DOJ so they don’t move to dismiss — even if they’re thinking of moving to dismiss?
We’re going to hear from great panelists at the DOJ, Colin Huntley and Ed Crooke, who are both assistant directors in Civil Frauds. They have been there for a long period of time and are very familiar with (c)(2)(A) and with how it’s being used currently by the Department of Justice, so they’re going to give some great insight into that. And then we have Anna Haac who’s on the relator side at Tycko & Zavareei. She has brought a case … that was declined and then [went on to make] important case law. So it’s going to be interesting to hear her perspective of potentially some of the ways that (c)(2)(A) may impede new case law, for example, that the relators’ bar might be making on declined cases.
So we’re really well rounded. And I’m on the defense side of FCA cases, so I’ll have that perspective too. It will be a well-rounded and interesting panel.
Oswald: Derek, thank you.
Adams: Thank you Scott.
Oswald: [Turning to camera] And thank each of you for watching this episode. We look forward to seeing you in Washington on February 27-28, 2020. You can register at fedbar.org.