If You’re a False Claims Act Whistleblower, Learn How Qui Tam Lawyers Kohn, Kohn & Colapinto Can Help You Get a Whistleblower Reward and Protect you Against Employer Retaliation
For over 30 years, our qui tam lawyers have been representing False Claims Act whistleblowers seeking rewards under the False Claims Act’s qui tam provisions. We have helped clients recover hundreds of millions of dollars stolen each year from American taxpayers.
In 2019, Kohn, Kohn & Colapinto was the only whistleblower law firm to receive the prestigious Top 50-Elite Plaintiff’s Law Firms award by The National Law Journal – setting yet another decisive landmark achievement in our firm’s successful legal history.
If you believe you have firsthand knowledge of frauds and violations against the government, you need a qui tam lawyer you can trust. The attorneys of Kohn, Kohn & Colapinto can help you get a reward for your valuable information and protect you from harsh employer retaliation.
Qui Tam Lawyers with Deep Experience Fighting for Whistleblowers
False Claims Act whistleblower Dr. Aaron Westrick forced the recall of thousands of unsafe bulletproof vests sold to law enforcement and the U.S. military. Dr. Westrick worked as a senior manager for the largest manufacturer of bulletproof vests.
As a qui tam whistleblower, he fought to protect police officers by forcing defective bulletproof vests off the market. In June 2005, the Department of Justice (DOJ) intervened in his qui tam lawsuit. Two weavers, Barrday and Hexcel, settled with the DOJ for $1 million and $15 million.
In related qui tam actions, the government collected tens of millions as a direct result of Dr. Westrick’s disclosures. The manufacturer, Second Chance Body Armor, admitted liability in its bankruptcy proceeding and paid the United States millions of dollars in damages. Dr. Westrick also prevailed in a related qui tam action filed under the State of California’s False Claims Act.
On March 15, 2018, the DOJ announced a settlement in which the Japanese manufacturer of Zylon, Toyobo Co., Ltd., agreed to pay the United States $66 million. In this case, the final victory came on July 16, 2018, by a settlement with former Second Chance president and CEO Richard C. Davis, who agreed to pay the government $125,000 to settle claims related to the False Claims Act lawsuit filed against Second Chance.
Initially enacted by President Lincoln to curb rampant profiteering during the Civil War, the False Claims Act is the most effective whistleblower law ever passed to protect and reward whistleblowers who expose fraud in government contracting.
The False Claims Act qui tam provision empowers whistleblowers who have firsthand knowledge of frauds/violations to report them to the appropriate government officials and incentivizes the whistleblowers to work directly with government investigators, often in the capacity of a confidential informant.
The False Claims Act qui tam law sets mandatory minimum payments to whistleblowers to help convince “insiders” to take the risk of losing their jobs or suffering other harms. This mandatory minimum is enforceable in court. The guaranteed minimum payments, which are often in the millions of dollars, are essential for convincing potential whistleblowers to step forward.
What are the Various Types of Government Contracting Frauds?
The most common types of government contracting fraud schemes include:
- Overbilling the government for more than was provided;
- Fraud in obtaining a government contract;
- Providing defective goods to the government;
- False statements on customs forms;
- False statements to get a government lease;
- Failure to comply with government contracts or leases;
- Failure to pay monies owed to the government;
- Knowingly presenting (or causing to be presented) to the federal government a false or fraudulent claim for payment;
- Conspiring with others to get a false or fraudulent claim paid by the federal government;
- Knowingly using (or causing to be used) an invalid record or statement to conceal, avoid, or decrease an obligation to pay money or transmit property to the federal government.
In addition to government contracting fraud, the False Claims Act whistleblower law also extends to other industries where government monies are involved and programs violated under the False Claims Act. These types of fraud include:
- Healthcare Fraud: Medicaid and Medicare Fraud committed by doctors, hospitals and other types of medical care facilities; Unnecessary medical procedures billed to Medicaid or Medicare; Illegal marketing of drugs by pharmaceutical companies;
- National Defense Fraud: Defense contract fraud, where funds are shifted from one contract to another to profit, or the intentional inflation of costs;
- Education Fraud: For-profit colleges and universities violate the rules of the student loan programs improperly recruiting students to generate income;
- Bank & Mortgage Fraud: Bankers submitting false claims for government insurance based on wrongful foreclosures;
- Underpayments to Government: A reverse false claims action can occur when defendants knowingly make a false statement in order to avoid having to pay the government when payment is otherwise due.
A False Claims Act whistleblower can receive between 15 and 30 percent of the total recovery the U.S. gets from the defendant. The government is required to make these payments. If the government refuses to pay the requisite reward, you can challenge that denial in court.
There are no “caps” on awards; the value of the information the whistleblower provides serves as the basis for the award’s amount: The better the information provided, the larger the sanction. The larger the sanction, the larger the reward. The False Claims Act qui tam provision incentivizes whistleblowers to give the government the best evidence, related to the biggest frauds.
Since 1986 approximately $7.3 billion has been paid as rewards to whistleblowers. The False Claims Act, Dodd-Frank Act, Securities Exchange Act, IRS/Tax, Commodity Exchange Act, and Auto Safety Act all have provisions for the mandatory payment of whistleblower rewards to qualified whistleblowers. They also provide for judicial review if an agency fails to pay the required compensation.
Whistleblower reward laws have proven to be the best tools for detecting fraud and corruption. The success of the False Claims Act triggered Congress’ enactment of several robust qui tam whistleblower laws, which protect whistleblowers from retaliation and permit False Claims Act whistleblowers to obtain large monetary rewards. The most important of these laws are:
- The Dodd-Frank Act’s SEC Whistleblower Law
- The Dodd-Frank Act’s CFTC Whistleblower Reward Law
- The FCPA Whistleblower Reward Law
- The IRS Tax Whistleblower Reward Law
- Auto Safety Whistleblower Reward law
- Act Against Pollution at Sea
When filing a qui tam lawsuit, you need qui tam lawyers you can trust. Since 1988, we’ve been using qui tam law to protect the identity of our whistleblower clients and qui tam relators, guarding them against retaliation and helping them navigate the complex process of filing.
A qui tam action must be confidentially filed under seal in federal district court following the Federal Rules of Civil Procedure. A copy of the complaint, with a written disclosure statement of substantially all material evidence and information in the plaintiff’s possession, must be confidentially served on the U.S. Attorney General and the U.S. Attorney for the district the complaint is filed.
In addition to filing a formal qui tam lawsuit in federal court, you must also comply with the other requirements of the law, including the following:
- The False Claims Act whistleblower must file the complaint under “seal,” which is secret and not public. The complaint is strictly confidential when first submitted;
- You must be the “first to file.” If another qui tam relator files a claim based on the fraud you are alleging before submitting your qui tam lawsuit, this disqualifies you from the qui tam process;
- You must file a “disclosure” statement with the U.S. Attorney General and the local United States Attorney’s Office where the complaint gets filed. This disclosure statement must contain “substantially” all of your evidence, and you can also submit documents as part of the disclosure;
- The complaint is not served on any of the defendants. The whistleblower serves the complaint on the local U.S. Attorney’s Office and the United States Attorney General. Until the court orders the “seal” removed, you must keep the fact that you filed a False Claims Act case strictly confidential. If the plaintiff violates the provisions of the seal, his or her complaint could be dismissed.
Furthermore, each state has its own rules and regulations regarding filing a state qui tam relator reward case. But to facilitate filing state qui tam cases, Congress amended the federal False Claims Act to make it relatively easy to include state claims as part of a federal qui tam lawsuit.
What Does A Decision On “Intervention” Mean?
Once the complaint is filed in court and served on the U.S. Attorneys Office and the Attorney General, the United States is required to investigate the whistleblower’s information. After completing the investigation, the United States decides whether to “intervene” in the case. Once the United States communicates its decision as to whether it will intervene to the presiding judge, the case is usually taken out of “seal” and filed on the public docket. Although the whistleblower is confidential when filing the qui tam lawsuit, once a case is out of seal, the whistleblower’s identity is on the public record. However, for a good cause, a whistleblower can ask a Court to keep his or her identity confidential.
If the United States “intervenes” in the case, the United States takes over the litigation and proceeds to prosecute the fraudster. The whistleblower remains a party in the case and can fully participate, but the United States conducts the litigation. When the United States intervenes, it generally means that a case will have a favorable resolution. The government has validated the allegations raised by the whistleblower and is willing to spend resources fighting the defendant.
If intervention is “declined,” the whistleblower has a right to proceed with the lawsuit. Litigating a case after a declination is usually very difficult, as defendants will often aggressively fight the case. Also, a whistleblower may have to pay court costs if they lose the case. There is also the possibility of sanctions for misconduct or for filing a frivolous claim.
However, the qui tam provision that permits the whistleblower to pursue a case, even if the United States declines prosecution, is among the most critical rules in the False Claims Act. It helps to keep the government honest.
How Long Does It Take For The Resolution of A False Claims Act Case?
It is not unusual for qui tam cases to remain under seal for an extended period, even for multiple years. The government is typically required to file periodic reports with the district court explaining the reasons for extending the seal. The case is taken out of seal once the government decides whether or not to intervene and take over the whistleblower’s qui tam case. Then the case may proceed out of the seal, like any other civil case. Some cases resolve relatively quickly while other cases move to full litigation and may continue for several years before final decision or settlement.
Under Section 3730(h) of the False Claims Act, any employee who is discharged, demoted, harassed, or otherwise retaliated against for taking actions to promote the purposes behind the False Claims Act can file an employment discrimination claim in federal court. This action can be presented as part of a qui tam reward case or as a stand-alone cause of action. The law provides for a jury trial and full “make whole” relief, including reinstatement, double back pay, and compensation for any special damages, including litigation costs and reasonable attorneys’ fees.
The False Claims Act provisions cover relators filing qui tam lawsuits and prohibits retaliation for filing a qui tam action. Every law has its own rules and regulations governing the filing of a qui tam lawsuit or a request for a whistleblower reward. These procedures are very technical. Failure to file a timely claim following the specific procedures outlined in each law can result in an otherwise qualified whistleblower losing his or her claim to a reward.
Frequently Asked Questions
The False Claims Act, linked here, is codified as 31 U.S.C. §§ 3729-33. Section 3729 sets forth anti-fraud requirements of the Act, and Section 3730 includes the provisions related to filing a qui tam lawsuit.
Most of the reward laws have a mandatory minimum and maximum award level. Under the False Claims Act and IRS whistleblower law the minimum award is 15% and the maximum award if 30%. Under the Security Exchange Act, Commodity Exchange Act and FCPA the minimum award is 10% and the maximum award if 30%. To qualify for a reward the whistleblower’s original information must be responsible for a successful enforcement action or prosecution.
The term qui tam is a Latin phrase which means “in the name of the King.” Qui tam lawsuits or claims allow individuals to earn financial rewards on the government’s behalf if their disclosures lead to successful enforcement actions. Permitting whistleblowers to use qui tam laws to obtain rewards is now incorporated into many modern whistleblower laws, including the False Claims Act.
Yes. Non-U.S. citizens can hire whistleblower attorneys. CFTC whistleblowers who live outside of the U.S. can hire attorneys to assist in filing their Dodd-Frank Act or Commodity Exchange Act case. In order to file an anonymous claim, you are required to hire a licensed U.S. attorney. Request a free consultation with an experienced attorney today.
Many whistleblower attorneys work for a “contingency” fee. In a contingency fee case the clients do not pay any attorney’s fees. If the whistleblower loses his or her case, they do not owe the attorney any money. If the whistleblower wins the case, the contingency payment for the attorney is generally between 30-40% of the award.
Originally signed in 1863 by President Lincoln, the federal False Claims Act was modernized in 1986 and is first contemporary whistleblower reward law. Other reward laws are modeled on the False Claims Act.
In a qui tam action, a private party known as a relator or a whistleblower brings an action on the government’s behalf against a person or company who is believed to have violated the law. The qui tam whistleblower can receive monetary rewards if their disclosures result in a successful enforcement action. Each qui tam law has its own filing procedures and rules. These include laws covering government procurement and contracting, Medicaid or Medicare frauds, securities and commodities frauds, tax evasion or the underpayment of taxes, money laundering, and foreign bribery, among others.
Qui tam is a Latin phrase that translates to “in the name of the King.” It is a medieval concept in which citizens were granted the powers of the King to help enforce the law.
The concept of qui tam, which allows individuals to qualify for financial rewards on the government’s behalf if their disclosures lead to successful enforcement actions, is incorporated into many modern whistleblower laws, including the False Claims Act.
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