The Federal False Claims Act authorizes private citizens, called relators or “whistleblowers,” to file claims on behalf of the United States. In these cases, known as qui tam actions, the whistleblower may receive up to 30% of the proceeds recovered by the government, plus other damages in certain circumstances. The proceeds are offered by Congress to provide incentives for whistleblowers to come forward and expose fraud against the government. In 2012 alone, approximately $5 billion was recovered in cases brought under the False Claims Act. The whistleblowers’ share of those recoveries was $431 million.
While the most common whistleblower suits arise from the healthcare and defense contracting industries, violations occur in virtually every field in which government funds play a role. The False Claim Act is violated any time a company or individual misrepresents facts which cause the government to spend more money than it would have otherwise. Violations range from overcharging for a service or charging for a non-existent service, to schools falsifying the number of employed graduates in order to receive more funding from the government.
If you have information about a potential qui tam claim, it is important that you contact a lawyer immediately. It is also crucial that you allow a lawyer to review any waiver or release that your employer asks you to sign before you sign it. In many cases, signing such documents will negatively impact or bar your claim.
Recently, several courts have dismissed qui tam lawsuits due to preventable errors of this nature. The courts based those dismissals on a lack of standing because the whistleblowers signed broad releases waiving rights to assert claims against their employers. Standing is a legal concept addressing “whether the litigant is entitled to have the court decide the merits of the dispute.” Warth v. Seldin, 422 U.S. 490, 498 (1975). This is a fundamental question courts must answer because without it, there is no jurisdiction to hear the dispute. If a party lacks standing, the case will be dismissed. Therefore, the common and preventable error of signing a broad release could destroy standing and keep the relator from pursuing a qui tam action. This result may be avoided by consulting with a lawyer before signing away your rights.
Lawyers at Beasley Allen have been prosecuting this type of fraud for over 30 years and would welcome the opportunity to assist any person to preserve and assert legitimate qui tam claims. If any person believes they have such a claim, our lawyers will be glad to assist. If any of our readers either have claims or need more information on this subject, contact Chad Stewart, Archie Grubb or Andrew Brashier, lawyers in our firm, at 800-898-2034 or email Chad.Stewart@beasleyallen.com, Archie.Grubb@beasleyallen.com or Andrew.Brashier@beasleyallen.com.
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