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NJ Adopts False Claims Act

Today New Jersey Governor Jon Corzine signed into law the New Jersey False Claims Act, which is similar to the federal False Claims Act. New Jersey is the 17th state to adopt a False Claims Act. The New Jersey False Claims Act closes a loophole that the D.C. Circuit read into the federal False Claims Act in United States ex rel. Totten v. Bombardier Corp., 380 F.3d 488 (D.C. Cir. 2004). Under Totten, liability is limited to companies that present false claims directly to the federal government. This loophole has enabled subcontractors to escape liability for submitting a false claim to prime contractor where the claim was not directly presented to the federal government. The New Jersey False Claims Act closes the Totten loophole by prohibiting any company from “knowingly presenti[ng] or caus[ing] to be presented to an employee, officer or agent of the State, or to any contractor, grantee, or other recipient of State funds, a false or fraudulent claim for payment or approval.”

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