Category Archives: FCA

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Industry Struggles With Ever Changing Acquisition Rules

Note: This post was originally published in the October 2017 issue of the National Defense Industrial Association’s National Defense magazine. Recent studies show that the percentage of overall research and development spending sponsored by the government has dropped sharply over the last 50 years. Whereas government funding accounted for 67 percent of R&D in 1964, … Continue Reading

What’s Past is Prologue: How The FCA’s Eventful Year in 2016 Will Affect Government Contractors

2016 was a big year for the False Claims Act (FCA).  Total government recoveries were up; total new matters filed were up; and total new government-led FCA matters were up.  The Supreme Court issued multiple decisions relating to the FCA, including one—Universal Health Services, Inc. v. U.S. ex rel. Escobar, 136 S. Ct. 1989 (2016)—which … Continue Reading

FCA’s “Implied Certification” Theory Survives

We previously reported on the viability of the “implied certification” theory of FCA liability based on oral argument before the Supreme Court in Universal Health Services, Inc. v. U.S. ex rel. Escobar.  We concluded that the theory—under which a claim for payment can be false without an express certification, but because the government contractor has … Continue Reading

Did the FCA’s “Implied Certification” Theory Dodge a Bullet?

Last week’s argument before the Supreme Court in Universal Health Services, Inc. v. United States ex rel. Escobar had the potential to put false claims based on an “implied certification” in the crosshairs. Instead, based on the weight of questioning by a plurality of justices, it appears that some form of implied certification theory may survive. … Continue Reading

Contractors Beware: An Overly Broad Confidentiality Agreement Could Cost You!

On October 29, 2015, DOD renewed the DFARS deviation implemented in February, which prohibits contracting with entities that require employees or subcontractors to sign internal confidentiality agreements or statements that prohibit, or otherwise restrict, such employee or subcontractor from lawfully reporting waste, fraud, or abuse.  Defense contractors should review their policies to ensure they meet … Continue Reading

Whew! That Was Close – D.C. Circuit Reaffirms Application of Attorney-Client Privilege and Attorney Work Product Doctrine in Internal Investigations

On August 11, 2015, the U.S. Court of Appeals for the D.C. Circuit issued a writ of mandamus supporting the robust applicability of the attorney-client privilege and attorney work product doctrines in the context of False Claims Act (“FCA”) investigations conducted under the direction of corporate and outside counsel. This marks a continuation of its … Continue Reading

Seventh Circuit Rejects FCA Implied False Certification Theory

On June 8, 2015, the U.S. Court of Appeals for the Seventh Circuit rejected the doctrine of implied false certification in a False Claims Act (“FCA”) lawsuit, U.S. ex rel. Nelson v. Sanford-Brown Ltd.  No. 14-2506, 2015 WL 3541422.  In a welcome decision for government contractors, the Court held that the FCA is “not the … Continue Reading

SCOTUS: No Unlimited Suspension of the Statute of Limitations Under the False Claims Act; “First-to-File” Doctrine Does Not Bar Related Suits in Perpetuity

In an opinion released May 26, 2015, Kellogg Brown & Roots Services, Inc. v. United States ex rel. Carter, the U.S. Supreme Court unanimously held that whistleblowers cannot extend the statute of limitations for war-related civil false claims under the Wartime Suspension of Limitations Act (“WSLA”), reinstating an already generous statute of limitations period under … Continue Reading

When it Comes to Crop Insurance, the FCA Bears Fruit

The federal crop insurance program is an often overlooked area of potential liability under the False Claims Act (“FCA”).  The program, which is governed by a substantial body of regulatory law, is subject to intense oversight by the U.S. Department of Justice.  So much so that the U.S. Department of Agriculture’s Risk Management Agency maintains … Continue Reading

Add Importers to Those Facing Expanding Whistleblower Claims Under the False Claims Act

On February 12, 2015, the Department of Justice (“DOJ”) announced that three U.S.-based importers had agreed to pay more than $3 million to resolve a lawsuit brought by the United States under the False Claims Act (“FCA”).  The Government alleged that the importers had made false declarations to U.S. Customs and Border Protection (“CBP”) and … Continue Reading

You Again?: Application of the First-to-File Bar Where Subsequent Actions Are Brought By the Same Relator

The Federal False Claims Act (“FCA”), 31 U.S.C. § 3729, et seq., has unique procedural aspects that come into play when a private whistleblower (the “relator”) seeks to sue on behalf of the Government.  One of these, the so-called “first-to-file” bar, applies when two “related” whistleblower actions are filed:  “When a person brings an [FCA … Continue Reading

The Fourth Circuit Strengthens the FCA’s Implied Certification Theory in Triple Canopy

Under the “implied certification” theory of liability, a government contractor can violate the False Claims Act (“FCA”) by submitting a mere invoice for payment.  The theory is that the invoice’s submission impliedly certifies compliance with contract conditions.  If a contractor is not complying with material contract requirements and — despite the contractor’s noncompliance — submits … Continue Reading

First Circuit Reaffirms FCA’s “First-to-File” Bar as a Broad Jurisdictional Limit

In early December 2014, the United States Court of Appeals for the First Circuit reaffirmed that circuit’s broad interpretation of the False Claims Act’s “first-to-file” bar, 31 U.S.C. § 3730(b)(5), in United States ex rel. Ven-a-Care of the Fla. Keys v. Baxter Healthcare Corp., 772 F.3d 932 (1st Cir. 2014).[1]  The first-to-file bar, as we … Continue Reading

Implied Waiver of Privilege in Internal Investigations: Barko Court Compels Production of Internal Investigation Documents, Again

On November 20, 2014, the District Court for the District of Columbia once again ordered Kellogg, Brown and Root (“KBR”) to produce all documents prepared as part of an internal investigation.  The District Court’s decision comes after the D.C. Circuit, in an opinion that was welcome news for in-house counsel, found that the documents prepared … Continue Reading

Recent Developments in Cases Dealing with the False Claims Act’s First-to-File and Public Disclosure Bars

This blog post is a preview of a presentation Mr. Turetzky will be giving at the American Bar Association Public Contracts Law Section’s Fall Meeting in Miami, Florida on November 1, 2014.      The False Claims Act, 31 U.S.C. §§ 3729-3733, enables whistleblowers—also known as qui tam relators— to file fraud suits on behalf of the … Continue Reading

DC Circuit Ruling Confirms Reasonableness Of Resellers Relying On TAA Certifications From Suppliers

The U.S. Court of Appeals for the District of Columbia Circuit has issued a ruling bringing to an end the long-running False Claims Act (“FCA”) case filed by relator Brady Folliard and providing useful guidance to resellers servicing the Federal government through the GSA Multiple Award Schedule program.[1]  In affirming the district court’s decision to … Continue Reading

Recent Remarks By Officials Reinforce DOJ’s Focus On Criminal Fraud Investigations And Prosecutions Of Culpable Individuals

In a trio of speeches given at separate events on September 17, 2014, Department of Justice (“DOJ”) officials announced new initiatives and points of emphasis in the Government’s ongoing efforts to hold corporations and corporate officers criminally liable in the aftermath of the 2008 financial crisis.  Among the issues addressed by Assistant Attorney General Leslie … Continue Reading

Attorney-Client Privilege Protection in Internal Investigations Upheld by D.C. Circuit: Good News for Corporate Counsel

This article was originally published by Bloomberg Law. In a much-anticipated decision, the D.C. Circuit clarified the general test for the applicability of the attorney-client privilege in internal investigations. In re Kellogg Brown & Root, Inc., 14-5505, 2014 WL 2895939 (D.C. Cir. June 27, 2014). The court unanimously rejected the district court’s holding that a … Continue Reading

How Are Your Physicians Compensated? Stark Law + False Claims Act = Halifax Paying $85 Million

On March 10, 2014, just days before trial, Halifax Hospital Medical Center and Halifax Staffing, Inc. (collectively “Halifax”) entered into an $85 million settlement with the U.S. Department of Justice resolving allegations that they violated the False Claims Act (“FCA”) by submitting Medicare claims that violated the Stark law.  See Notice of Settlement and Settlement … Continue Reading

Sarbanes-Oxley Whistleblower Protections Cover Employees of a Public Company’s Private Contractors

On March 4, 2014, the United States Supreme Court, in a 6-3 decision, expanded the protections offered to whistleblowers under anti-fraud laws, in Lawson v. FMR LLC.  In its decision, the Court ruled that a specific protection against retaliation enacted as part of the Sarbanes-Oxley Act after Enron’s collapse, i.e., 18 U.S.C. § 1514A, not … Continue Reading

Proceed with Caution: D.C. District Court Says Attorney-Client Privilege and Work Product Doctrine Do Not Survive Internal Fraud Investigation Conducted by Non-Attorneys

On March 6, 2014, the District Court for the District of Columbia issued an opinion in United States ex rel. Barko v. Halliburton Company et al. that should serve as a wake-up call for all companies conducting internal compliance investigations to evaluate whether those investigations are structured in a manner to maximize the protections of … Continue Reading

David Douglass on the False Claims Act

Sheppard Mullin government contracts partner David Douglass was recently quoted at length in an article discussing the defense of False Claims Act cases.  Although the Government is all too often using the False Claims Act as an all-encompassing fraud statute, Mr. Douglass notes that companies are having more success defending against these allegations in recent … Continue Reading

False Claims Act Whistleblower Bounties Exceed $345 Million in Fiscal Year 2013

The DOJ has released its Fiscal Year (“FY”) 2013 totals for civil settlements and judgments recovered under the federal False Claims Act (“FCA”).  To say that the Department had a successful year in prosecuting fraud against the government would be putting it mildly.  According to the DOJ release, the government recovered $3.8 billion under the … Continue Reading
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