Do You Need a Qui Tam Lawyer?
Are you a whistleblower who wants to report fraud against the government?
- Is your employer double-billing, overcharging, or otherwise cheating on a federal contract?
- Do you want to file a qui tam lawsuit and get a whistleblower reward — but are not sure how?
- Are you afraid that you'll face retaliation if you blow the whistle?
The False Claims Act was designed to help people like you.
The False Claims Act (FCA) — originally signed by Abraham Lincoln — is a federal law that forbids the submission of false claims for payment to the federal government. The FCA applies to many areas where U.S. taxpayers ultimately foot the bill, from Medicare to university research grants to defense contracting.
Under the law's famous "qui tam" provision, people who know about fraud may sue on behalf of taxpayers to recover the ill-gotten gains — and, as a reward, may receive up to 30% of the money they help to recover.
The FCA also contains an anti-retaliation provision that protects whistleblowers. If you have been punished for opposing fraud against the government, the FCA may be able to stop the fraud and get your job back.
Important statutes in this area of law:
Liability for false claims; qui tam provision; anti-retaliation provision
Notable TELG cases in this area of law:
In September 2017, TELG client Mary Kaye Welch defeated her former employer’s attempt to push Ms. Welch’s fraud claims — filed on behalf of taxpayers — out of an open courtroom and into private arbitration.
TELG Client Jon Oberg discovered that student lender Nelnet received improperly high payments on student loans. TELG filed a qui tam action under the false claims act and Nelnet eventually settled for $55 million.
The Employment Law Group, PC, secured a $3.6 million judgment against a defense contractor under the False Claims Act’s qui tam provision.
The Employment Law Group, P.C., secured an $819,000 jury verdict against the University of Virginia in a retaliation case brought under the False Claims Act.
The qui tam attorneys at The Employment Law Group® law firm are experienced in filing False Claims Act lawsuits — and we work closely with the U.S. Department of Justice, which investigates these whistleblower claims.
Our firm is a recognized leader in FCA whistleblower law; our attorneys frequently speak and write on the topic. We have represented qui tam relators from all walks of life, from ambulance drivers to researchers to senior executives.
Our attorneys have filed whistleblower cases that resulted in settlements as high as $57 million in a student-loan case. In March 2016, our client Joseph Ting helped the U.S. government to regain $34.7 million from 21st Century Oncology, a chain of cancer-treatment centers that was accused of overbilling Medicare.
Other TELG clients have helped to secure judgments or settlements in fraud cases against a military contractor, a hospice operator, a sleep-disorder clinic, an eye-care center, and a network of physical-therapy clinics.
As employment lawyers, furthermore, we have lots of experience helping employees to fight back against unjust punishment — including whistleblowers who face retaliation. Our client Weihua Huang won an $819,000 jury verdict in a FCA retaliation case against the University of Virginia, for instance.
The FCA authorizes a reward of 15% to 30% for successful qui tam claims, along with the reasonable cost of litigation.
In cases involving retaliation, the FCA provides that prevailing whistleblowers will be made whole — i.e., will be returned to the same position they would have been in without the retaliation. In particular, the law authorizes reinstatement and/or an award of front pay, double back pay, interest on back pay, litigation costs, reasonable attorney fees, and damages for emotional distress.
As with all legal claims, deadlines are crucial. Qui tam cases usually may not be brought more than six years after the fraud in question. If you've been fired or otherwise have suffered at work for blowing the whistle on fraud, you generally must file a claim within three years.
Frequently Asked Questions
What kind of reward can a qui tam relator expect under False Claim Act?
Because people who file a qui tam lawsuit are helping to retrieve money that’s been stolen from taxpayers, the government will reward them anywhere from 15% to 30% of the amount recovered in a successful case. This encourages more whistleblowers to come forward. No reward is paid for a case that fails or is dismissed.
What does qui tam mean?
Qui tam is derived from the Latin phrase qui tam pro domino rege quam pro sic ipso in hoc parte sequitur, which essentially means “who sues in this matter for the ruler — and for himself.” The idea of rewarding citizens for blowing the whistle on fraud against the government has always been part of the False Claims Act, which was originally signed by Abraham Lincoln, and qui tam actions have recovered many billions of dollars for taxpayers.
What is the public purpose of rewarding qui tam whistleblowers?
The government often can detect large-scale frauds that involve billions of dollars, but in many cases smaller amounts are defrauded over a period of time, ultimately building up to a substantial sum. The qui tam action is a legal tool that encourages employees and other citizens to bring such frauds to the notice of the government. The reward also can be seen as just compensation for the professional and personal risks taken by whistleblowers.
The U.S. Department of Justice is a strong supporter of qui tam actions — and with good reason. On average, taxpayers recover $15 for every dollar spent on investigating and pursuing qui tam actions.
Does the government get directly involved in qui tam lawsuits?
In a qui tam lawsuit, the whistleblower (also known as a “relator”) initiates the action on behalf of the government, as well as himself or herself. Two alternative scenarios may follow. The government may opt to “intervene” and join the relator — essentially taking charge of the case against the accused. Or the government may allow the relator to continue the action by him- or herself, but still will receive any recovery in case of success. If the government doesn’t intervene, it will give the relator a larger share of the recovery as a reward for doing more of the work.
Who can be a qui tam whistleblower?
The False Claims Act allows any individual or entity to file a qui tam suit provided they have sufficient evidence of fraud involving federal funds. However, a plaintiff must meet certain conditions for the case to proceed:
- The evidence cannot already have been used in a different False Claims Act case.
- The evidence cannot be in the public domain.
- Another plaintiff cannot already be pursuing a qui tam case with respect to the same fraud.
- The plaintiff must file the case within a period of six years from the date on which the fraud occurred — although under some circumstances the time limit may be extended to 10 years. (The provisions with respect to time limit are complicated and they have been interpreted differently in different jurisdictions.)
Are qui tam cases limited to fraud against the federal government?
The phrase qui tam generally is used only in connection with federal cases, but most U.S. states have a local equivalent to the federal False Claims Act, allowing plaintiffs to bring action against an individual or business defrauding the state — and awarding such plaintiffs a percentage of any state funds they help to recover. Details vary from state to state, but the overall framework is similar. In some cases — Medicaid fraud is a good example — both federal and state laws may be invoked in the same qui tam action.
What should I consider before filing a qui tam lawsuit?
If you intend to file a qui tam lawsuit, there are some important things to know.
- Your evidence should be conclusive and convincing. A qui tam case is a huge commitment that will disrupt your life considerably. Even though many law firms will work on contingency — meaning you won’t have many out-of-pocket expenses — you’ll face other economic costs, including a possible loss of employment. If your case is successful you can be made whole, but that’s a gamble and you’ll face financial pain in the meantime. It’s not a decision to make lightly.
- You should find an experienced qui tam law firm. Qui tam lawsuits are complicated actions with lots of rules, and it’s easy to make mistakes. Early decisions, like deciding which court to file the case in, can affect the outcome greatly. In addition, your qui tam lawyer should have a strong working relationship with the government attorneys who will decide whether to support your case — because government intervention will raise your chances of success substantially. Effective representation and legal research throughout the case will also increase the reward that you stand to gain at the end of the action. As with any difficult task, practice helps: Your lawyer should have worked on a lot of qui tam cases, and should be prepared to take your case all the way to its conclusion.
- Your case will likely take years to reach an outcome. If you believe in your cause, this may not be a burden — and a good lawyer will try to minimize the impact on your life. But some whistleblowers are worn down by the legal process, especially after the first year.
How to file a qui tam suit
Qui tam cases are filed under seal, which means that the complaint is not made public and the accused party isn’t notified immediately. This is done so that the government has a chance to decide whether it will “intervene,” or take over management of the case.
As soon as the action is filed in court, a copy is sent to the Department of Justice. The government then starts investigating the facts. Investigation may take a long time, and in some instances may extend over a few years. The statutory seal period is just 60 days, but the government routinely asks courts to extend this period. You and your attorney may work in tandem with government investigators during this phase.
Once the initial investigation is complete, the government elects whether to intervene and the case is unsealed. The government’s decision often depends on the seriousness of the alleged wrongdoing, as well as the evidence that supports the relator’s claim of fraud. From the whistleblower’s perspective, intervention is not necessary but is highly desirable. The government has virtually unlimited legal resources and strong tools for gathering information, which can enhance the chance of success.
Even if the government decides not to intervene at first, it may revise its decision on a later date.
What determines the size of reward given to a successful qui tam relator?
The amount that the whistleblower may gain as reward depends on various factors. The quality of evidence, the total sum defrauded, the relator’s contribution to the success of the lawsuit: All affect the reward amount. Typically, the relator is entitled to 15% to 25% of the recovered sum if the government intervenes in the case. If the whistleblower carries out the action without the government’s help, he or she may be entitled to 25% or 30% of the total amount recovered.
What kind of frauds can be uncovered through qui tam actions?
Qui tam actions may be brought about in almost all instances where federal dollars have been misappropriated or used in a way that the government does not approve of. Some of the areas where such actions have been successfully filed are:
- Medicare fraud
- Medicaid fraud
- Defense contractor fraud
- Agriculture support programs
- Education fraud
- Housing program fraud
- Emergency relief program fraud
- Incorrect certifications
- Tax fraud
- Fraud in pre-selection of federal program beneficiaries
Specific examples of activities that can be illegal under the False Claims Act include:
- Double billing
- Upcoding and unbundling (for healthcare providers)
- Final billing for unfinished contracts
- Delivering poor quality products
- Unnecessary services or product features
- Excess markup on outside vendor products or services
- Dubious quality control practices
- Non-conformance to federal wage and employment laws
- Deliberate production or delivery delay for contracted services
- Financial bookkeeping not in compliance with GAAP
- Non-conformance to contract specifications
- Wasted university study and inappropriate travel grants
What protections does the False Claims Act offer for whistleblowers?
The FCA prohibits any action taken by an employer that has a negative effect on the terms, conditions, or privileges of employment. This includes termination, demotion, suspension, harassment and any other act that would dissuade a reasonable person from reporting violations of the FCA. An employee, contractor, or agent is protected against such acts if he or she acts in furtherance of a qui tam action, or tries to stop a fraud. Specific examples of protected activity include:
- Bringing illegal conduct to an employer’s attention;
- Refusing to participate in a scheme to defraud the government;
- Reporting to a supervisor that flawed devices were being provided to the military;
- Reporting internally the existence of fraudulent activity; and
- Any efforts to stop 1 or more FCA violations.
How does a plaintiff show that punishment was unlawful?
To prevail in an FCA retaliation case, the whistleblower must prove that he or she was engaged in protected activity; and that the employer punished the whistleblower despite knowing that he or she was engaged in protected activity.
The whistleblower must also meet legal deadlines for filing the claim, generally three years after the date on which the retaliatory act occurred.
More Information on Qui Tam:
I write to acknowledge TELG for their professionalism while handling my litigation, especially to attorneys Adam and Scott. I came to consult with Scott at the very beginning, which later turned out to be very rewarding. A lawsuit is a long, uncomfortable and stressful process. I was lucky to have Adam and Scott along with me, listening to details of my case, absorbing my opinions, keeping me informed in a timely way, preparing documents carefully, and making convincing recommendations and decisions. At every step of the way, they showed me a superior level of expertise in a complex area of the law. Much more, I was very impressed by their skills in the court. Most importantly, they obtained me a good result. I appreciate very much everything that Adam, Scott, and their associates in TELG have done, including their great efforts and valuable experience.
March 9, 2014
Area of Law: False Claims Act / Whistleblower