September 23, 2019 | Military & Defense Contracting Fraud
Whistleblowers Now Have More Time to Bring False Claims Act Lawsuits
Imagine this scenario: You go work for a military defense contractor, but soon learn that everything is not as above-board as it seems. You see your boss shift costs and expenses from one contractor to another to boost profits (a form of fraud known as cross-charging) and substitute lower-grade products for the more expensive ones the customer ordered.
It makes you furious. In addition to stealing from the government, your employer’s actions are endangering the lives of the men and women in the U.S. military. You want to blow the whistle on them, but getting together the necessary evidence takes time. If the government decides not to intervene in your case, you’ll need even more.
Now you have it. In May 2019, the U.S. Supreme Court ruled that whistleblowers may have up to four more years to bring False Claims Act (FCA) cases — past the six-year Statute of Limitations — whether or not the U.S. government intervenes in your case or not.
Extended statute of limitations for whistleblowers bringing a claim under the false claims act
Here’s what you need to know:
- Under the FCA, you must bring a qui tam lawsuit within six years after the violation occurred.
- That is, if you submitted a claim, but it’s been over six years since the violation actually happened, you would be barred from taking further action on it.
- – OR – within three years after the appropriate federal authority knew or should have known all the relevant facts (but not more than 10 years after the violation allegedly took place).
- This additional time to submit a claim relies on when exactly the government was put on notice of the violation.
- Before the SCOTUS decision, some circuit courts held that this part of the FCA only applied if the government intervened.
- The SCOTUS decision opined on the circuit split, saying that this second part applies to all civil suits, whether or not the government intervened.
The defendants in the case that ultimately led to the U.S. Supreme Court’s decision were defense contractors accused of defrauding the government by submitting false payment claims for providing security services in Iraq from 2006 up until early 2007. Cochise Consultancy v. U.S. ex rel. Hunt.
The relator, Hunt, filed a qui tam claim in late 2013, which meant he was past the six year mark since the violation occurred, per the FCA Statute of Limitations. However, Hunt had let U.S. officials know of the violation in a 2010 interview — which was within the three-year limit to inform the government of the violation. In his case, however, the government decided not to intervene.
Cochise, the defendant, argued that 1) it had been over six years since the violation occurred and Hunt was barred from bringing a claim, and 2) since the government didn’t intervene in his claim, then Hunt couldn’t use the three-year extension period specified by the second part of the FCA.
Essentially, according to the U.S. Supreme Court, even if the Department of Justice (DOJ) declines to intervene in your case, you may proceed with your claim, as long as:
- It hasn’t been over 10 years since the violation occurred, and
- If you bring your claim within 3 years after letting an appropriate U.S. official know of the violation, whether the DOJ decides to intervene or not, you are within the time limit.
The 6-year time limit to bring a claim after the violation occurred is then effectively extended to 10 years if you meet the above criteria.
What does this mean for you?
Thanks to the Supreme Court’s ruling, if the government doesn’t get involved in your qui tam lawsuit, the defendant’s attorneys won’t find it as easy to stop you based on the timing of your knowledge of the illegal actions. This law applies across different industries.
A successful False Claims Act lawsuit can penalize wrongdoers with damages up to three times the proven losses to the government. Some of these cases settle for millions of dollars, and you, the whistleblower, can pocket up to 30% of the recovery — potential compensation for saving American taxpayers and the federal government from fraudulent behavior.
Contact a North Carolina Whistleblower Attorney
When you blow the whistle on a dishonest company, you may be helping put a stop to fraud and providing a valuable service to the entire country.
If you suspect or have information regarding someone committing fraud, let’s talk. Our Carolina Whistleblower Attorneys can protect your rights, help you fight for a successful outcome, and try to maximize the amount of your reward. Your initial discussion about a potential qui tam claim is free and confidential, so please contact us or call 1-888-292-8852 today.
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Contact the Carolina
If you’re wondering if it’s a good idea to speak with a whistleblower lawyer about what you know, let us set the record straight.
- Corporate ethics hotlines can be risky and may lead to termination. If you’ve already done this, call us immediately.
- Your coworkers could be aware of the fraud – or complicit in it – and you should not talk to them about it.
- The first claim to be filed under the False Claims Act can proceed – if you’re not first, you’re at a serious disadvantage and may get nothing (another reason not to speak to your coworkers about it).
- A confidential discussion costs you a few minutes, but could save you time, stress, and money.
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