If you are aware of a company or individual that has defrauded the United States (i.e., the federal government) and/or defrauded any of the 50 states or the District of Columbia, then you may be entitled to file a lawsuit under the federal False Claims Act (“FCA”), 31 U.S.C. § 3729, et seq., and/or under similar state laws. Moreover, and as discussed below, you may be entitled to share in any financial recovery that is obtained by the government based on your FCA case.
As a procedural matter, FCA cases initially are filed “under seal,” which means that only the Court and the government know about the case. The defendant is not advised about the case when it is filed; and there is no public record of the filing. Rather, during the “seal” period – which can last many months or even several years – the government investigates the whistleblower’s FCA allegations to determine whether the government wants to take over the case (called “intervention”) so as to pursue the alleged FCA claims.
If the government “intervenes” in the FCA case, then the case is unsealed (made public) and the government leads the litigation against the defendant(s). On the other hand, if the government declines to intervene, then typically the case is unsealed and the FCA whistleblower needs to decide whether he/she wants to conduct the litigation against the defendant(s) – a decision that requires careful consideration of numerous factors.
Whether the government intervenes or not, if your FCA case ultimately is successful, then you almost certainly will be entitled to share in any financial recovery that is obtained by the government based on your FCA case. Indeed, depending on the circumstances, a successful “relator” (the FCA whistleblower) can obtain between 15%-30% of the government’s recovery. And, that recovery can be substantial – because the FCA provides for treble (3x) damages and also significant statutory penalties of approximately $11,000 (minimum) to $22,000 (maximum) for each false claim that occurred.