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How is a FCA Lawsuit Filed?
Liability for Violating the Federal False Claims Act?
What Happens after the Case is Filed?
How long does it take?
What is the "First to File" Requirement?
Is there a Deadline for Filing?
Should I Report Fraud to the Government or My Employer?
Will Wrongdoers go to Jail?
Can I Lose any Rights by Informing the Government Before I File Suit? Most people contact attorneys. See, How to Contact Jonathan Kroner. The attorney must file a formal legal document (the "complaint") must be filed in court in accordance with all procedural rules including: the Federal or Florida Rules of Civil Procedure, the local rules of that Court and the special procedural rules of the False Claims Act (Federal or Florida). In addition, a copy of that document, along with a written disclosure statement of all material evidence and information in the whistle blower's possession must be served on the government. The complaint must be filed under a special confidential seal--and should be marked as such. Until the confidential seal is lifted by the appropriate judge, the complaint and its contents must be kept strictly confidential. The complaint must not be served on or even disclosed to the defendant or others until the judge orders. If you violate the confidential seal provision, your suit could be dismissed and you could be held in contempt of Court. Back to Top Federal: Entities that receive United States Government funds, such as corporations, universities, cities and counties, are liable for up to three times the dollar amount that the United States Government is defrauded (that is, triple damages) and $5,000 to $10,000 for each false claim, any additional damages related to retaliation against an employee, plus legal fees and costs. Examples
Example of triple damages: The United States grants (pays) a city $10 million to build low cost housing. As a condition of the grant the United States requires the city to meet minimum federal safety and construction standards. The city did not build to federal construction standards. Instead, the city cut corners, claims it complied with the terms of the grant and the city commissioners headed to Paris where they wined and dined using money that should have been spent on bricks and mortar. Damages could be as much as $30 million (triple $10 million), plus any additional damages related to retaliation against an employee, plus legal fees and costs. Example of multiple violations ($10,000 per violation penalty): A hospital charged the federal Medicare program for a box of tissues per day for each patient. The hospital did not actually provide a box of tissues per day for each patient. Instead, it replaced tissues as needed, less often than once per day. Since the hospital charged the federal Medicare program (files a claim) once a month for each patient the damages can be $10,000 per patient per month for all Medicare patients for the previous five (5) years -- 60 or more months, plus any additional damages related to retaliation against an employee, plus legal fees and costs. Patients (example) | 10 | Total months | 60 | # of false claims | 600 | potential penalty per claim | $10,000 | potential recovery to United States*
| $6,000,000 | potential whistleblower recovery at 15% | $900,000 | | *plus legal fees and costs | | In fact, HCA (formerly Columbia Health Care) whistleblowers received over $100 million. See, Big Cases. However, it is not typical to recover the maximum allowed by law. Most cases settle before trial and the settlement is typically less than three times the loss. After all, if the government demands that the defendant pay the maximum possible amount, the defendant might as well take a chance and go to trial. Even with a good case, you should expect that it will settle for something less than the full damages. Florida: Entities that receive State of Florida funds, such as hospitals, corporations, private universities, who violate the Florida FCA are liable for the same penalties--triple damages plus $5,000 to $10,000 per false claim. Miami-Dade County: The following questions and answers relate only to the Federal law, and to Florida law when Florida is specifically mentioned. It does not relate to Miami-Dade County's ordinance. See, comments on Miami Dade's Purported False Claims Ordinance. Back to Top After you or your lawyer file your complaint in federal district court and serve a copy of your complaint and disclosure statement on the appropriate government representative, your case remains under confidential seal for at least 60 days (federal). This 60-day confidential seal period may be extended upon request by the Government. It is not unusual for the seal period to last a year or more. During the confidential seal period, the government investigates your allegations. At the end of the seal period, the government chooses either to proceed on its own (to intervene) or to allow you to prosecute the case yourself with your own lawyers (decline intervention). The government may, however, change its mind and, at a later date, intervene or withdraw from intervention. If the government intervenes and proceeds with the action, it has primary responsibility for prosecuting the case. You (and your lawyer) may participate in the litigation subject to certain limitations. In Federal cases, the government may even dismiss or settle the case notwithstanding your objections, but only if the judge agrees after a hearing on the proposed dismissal or settlement. After the government decides whether to intervene and the confidential seal period ends, the complaint is served on the defendant. The lawsuit then proceeds generally in the same manner as any other federal civil litigation, except for various special procedural issues related to this type of litigation. Back to Top The time from the filing of a case until its resolution varies from case to case. Some are settled relatively quickly, perhaps within a year of filing, especially when the Government decides to intervene. But, in general, you should be prepared for a case to take years. Back to Top First, if the Government or a private party has already filed a False Claims Act lawsuit based on the same allegations as the case you want to file, then you may not proceed with your lawsuit. Thus, if you believe you have a case, you should act quickly to determine your rights and how you wish to proceed. See, How to Contact Jonathan Kroner. Second, if the information is publicized before you file suit you may also lose your right to benefit under the statute. Thus, if you believe you have a case, you should act quickly to determine your rights and how you wish to proceed. Back to Top Under the Federal False Claims Act, an action must be filed within the later of the following two time periods: - six (6) years from the date of the violation of the Act; or
- three (3) years after the Government knows or should have known about the violation,
but in no event longer than ten years after the violation of the Act. Further, if someone else files a False Claims Act lawsuit or publicizes allegations similar to yours before you file, you may lose your right to bring suit. Thus, if you believe you have a case, you must act quickly to determine your rights and how you wish to proceed. See, How to Contact Jonathan Kroner. In Florida, the deadline for filing suit is five to seven years. Back to Top
In general, the Federal False Claims Act does not require you to report the fraud before filing suit. However, there are circumstances in which you must, or would be wise to, inform the Government before filing. You should speak with an attorney about this. Back to Top A suit under the False Claims Act is a civil action, not a criminal action. As such, imprisonment is not a remedy. Filing a case might trigger a criminal investigation. This would be separate from your case, and you would have no control over it. However, you might be asked to assist in the Government's criminal action. Also, if the U.S. Attorney opens a criminal investigation your case will be delayed until the completion of the criminal investigation. Since the False Claims Act does not involve criminal prosecution it does not require the same proof of bad intent or burden of proof as would a criminal fraud. Instead of having to prove a case beyond a reasonable doubt the whistleblower merely needs to prove fraud by a preponderance of the evidence. Back to Top Yes and No. You do not explicitly give up your rights by going to the Government before filing your lawsuit. However, you should be aware that you are barred from bringing a suit based upon allegations or transactions which are the subject of a False Claims Act suit already filed by the Government. So, if you deliver your information to the Government before filing, and the Government then files a False Claims lawsuit before you file, then you will have lost your right to file a false claim lawsuit. Thus, if you believe you have a case, you should act quickly to determine your rights and how you wish to proceed. See, How to Contact Jonathan Kroner. Back to Top
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