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False Claims/Qui Tam Litigation
False Claims/Qui Tam Litigation
What Is “Qui Tam” Litigation? | The False Claims Act Practice at V&E | Representative Matters | Related Publications and Presentations
The False Claims Act
The Department of Justice frequently calls the False Claims Act (31 U.S.C. §§ 3729-3733) the government's primary tool to combat fraud. This statute was enacted during the Civil War to combat profiteering by Union Army suppliers. It was reinvigorated by substantial amendments in 1986, and then again more recently by the Fraud Enhancement and Recovery Act of 2009 (FERA). The False Claims Act protects the government from many types of fraud, but particularly targets the submission of false bills or other “claims” that call upon the government to pay money it does not owe. It has been broadly applied to reach companies in many industries, including defense, energy, environmental, and healthcare.
FERA expands the Act to reach fraud not only on the government itself, but also on a wide range of private recipients of federal funding. Targets of this expanded statute will likely include financial institutions and others that receive federal “bailout,” grant, or stimulus funds — or companies that contract with those who do. In addition, many states have passed similar false claims or “whistleblower statutes,” which can increase the number and nature of a company’s potential adversaries.
The stakes in a False Claims Act case can be high. If a violation is proven, actual damages often are trebled, and additional civil penalties must be assessed for each violation of the Act. Even where the actual damages are relatively small, there may be many individual violations, which can lead to enormous civil penalties. False Claims Act cases often arise in the context of coordinated, parallel investigations by different government bodies, including federal criminal investigations, agency debarment proceedings, and congressional inquiries. An experienced lawyer pursuing a False Claims Act case can be expected to do everything possible in each of these arenas to maximize the pressure on the defendant company. What Is Qui Tam Litigation?
The False Claims Act allows private plaintiffs, called “relators,” to sue in the government’s name in qui tam actions. “Qui tam” comes from a Latin phrase meaning “he who brings an action for the king as well as for himself.” The False Claims Act allows relators to assert claims on the government’s behalf and to receive a share of any recovery, obtaining, in effect, a bounty for coming forward with knowledge of fraud. Relators often are former or disgruntled employees turned whistleblowers, suing under the Act for fraud against the government they claim to have observed during their employment. Qui tam lawsuits are initially filed “under seal” — that is, confidentially and without notice to the defendant — so that the government can investigate the allegations and determine whether it should intervene and take charge of the case. Whether or not the government intervenes, the relator is entitled to a portion of any recovery, which provides a strong incentive to bring such suits. In addition to receiving a bounty, a prevailing relator also can recover reasonable attorneys’ fees and costs from the defendant.
The False Claims Act Practice at Vinson & Elkins
Vinson & Elkins has the experience and resources to handle all aspects of False Claims Act law: - Our law firm works regularly with clients in the industries that are frequent targets of False Claims Act litigation, across a wide variety of substantive legal areas. V&E lawyers build teams to unite False Claims Act litigation experience and substantive familiarity with the industries involved.
- V&E has many years of experience handling the subpoenas and other governmental inquiries that often signal the likely filing under seal of a qui tam lawsuit. We treat those inquiries as opportunities to persuade the government not to intervene and lend its considerable resources to a relator’s case.
- We have a hands-on grasp of the False Claims Act. V&E lawyers have turned the complexities and unique features of the Act to clients’ advantage, often obtaining early decisions limiting the case or dismissing it altogether. And, if the case is not dismissed, we know how to take it to trial. We also have handled many False Claims Act appeals.
- Vinson and Elkins lawyers are experienced at handling the other inquiries and proceedings that often accompany False Claims Act litigation. If there is a criminal investigation or congressional inquiry, our law firm has seasoned white collar/government investigations lawyers with substantial prosecution and governmental experience to handle it. If a client is confronted with a government contracts or debarment issue, we have government contracts lawyers who understand the complicated issues occasioned by contracting with the government. If there are claims by disgruntled or former employees, we have experienced employment lawyers who can handle statutory or common-law claims. Often former employees assert statutory retaliation claims, and we have successfully moved many of those claims into employment arbitrations. Our depth and breadth of experience allow V&E to cover the wide-ranging issues that often arise in or along side False Claims Act litigation.
- We recognize that prevention is an essential element of any False Claims Act strategy, especially for companies that regularly contract with the government or receive government funds. Vinson & Elkins lawyers can help design and implement a compliance program, both to detect and deter the submission of potential false claims and, if necessary, to help persuade the government that drastic measures are not required to assure future compliance with the Act.
View the list of representative cases recently handled by V&E's False Claims/Qui Tam practice.
View a list of related publications and presentations by V&E lawyers.
Prior results do not guarantee a similar outcome.
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