The Judiciary Committee for the
U.S. House of Representatives recently held a hearing on proposed
amendments to the False Claims Act that would severely hamper the
rights of whistleblowers and their ability to successfully bring
qui tam lawsuits. The proposed changes are based on a
"wish-list" of reforms authored by business groups who are seeking
to limit whistleblowers' options and recoveries when bringing a qui
Proposed Amendments to False
Claims Act Would Limit Whistleblowers' Recoveries
The proposed amendments to the False Claims Act include
significant deterrents to whistleblowers and their efforts to bring
qui tam lawsuits alleging fraud. The most significant
proposed amendment to the False Claims Act would require
whistleblowers to report fraud internally at least 180 days before
being permitted to file a qui tam lawsuit. Other proposed
changes include a reduction of penalties that companies would have
to pay (thus reducing whistleblower awards to qui tam plaintiffs),
and forcing whistleblowers to drop their lawsuits if the government
does not intervene. Proponents of the proposed amendments
claim that such changes are necessary to prevent "weak and
Senator Grassley Testifies Against Proposed False Claims
In a rare occurrence, U.S. Senator Chuck Grassley asked to
testify before the House Judiciary Committee in opposition to the
proposed amendments to the False Claims Act. Senator Grassley
observed that the current False Claims Act was "working
fantastically," noting that the Act has allowed the government to
recover more than $42 billion in fraud claims since 1987, largely
due to the efforts of whistleblowers who come forward to report
fraud. Senator Grassley testified that the proposed changes
to the False Claims Act would hamstring whistleblowers' ability to
combat fraud by pursuing qui tam lawsuits. Senator Grassley
also testified that requiring whistleblowers to report fraud
internally "puts a huge target" on the whistleblower's back and
makes them reluctant to come forward to report fraud.
Reducing or limiting the recoveries for a
successful qui tam lawsuit have the same effect and place
unnecessary obstacles in the way of the largest source of tips that
lead to recovery for fraud against the government.
Finally, Senator Grassley testified that the proposed
amendments to the False Claims Act were simply "hefty concessions"
for the "big corporate sponsors" of the changes, and warned against
proposals purporting to "strengthen" the False
Claims Act by gutting penalties for companies and hindering
recoveries for whistleblowers
in qui tam suits.
We invite you to learn more from our Whistleblowers, Qui Tam & False
Claims Act Practice Group at Berger & Montague. For more
information or to schedule a confidential discussion from a false
claims act lawyer, please fill out the form on the right. You can
also call us at (215) 875-4699.
For further reading:
Our Law Firm's Approach to False Claims and Whistleblower
Tam Litigation Statistics and Trends
Seeking Qui Tam
Does a Qui Tam Relator Need to Identify Specific False Claims
Submitted to the Government?
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