False Claims Act Retaliation Claims – Prohibited Retaliation and Amendments

The False Claims Act (FCA) has allowed the government to fight back against fraud and abuse by recovering billions of dollars through cases filed under the Act. In 2012 alone, the U.S Justice Department recovered over $5 billion dollars through settlements and judgments under the FCA.

Codified at 31 U.S. Code § 3729, the False Claims Act allows private individuals that have evidence of fraud against the government to sue the defrauding entity or person on behalf of the government. These lawsuits are called qui tam lawsuits, or more commonly, whistleblower lawsuits. To establish a prima facie case under the FCA, the whistleblower has the burden of proving:

  • the qui tam defendant caused a false claim to be presented for payment to a government agency or caused such a false claim for payment to be provided; and
  • the qui tam defendant had knowledge that the claim for payment was fraudulent.

Depending on the industry, a false claim for payment might be:

  • upcoding
  • false rebate claims
  • inflated expenditures
  • claims for patients that don’t exist
  • invoices for materials not used

If a whistleblower has hard evidence of these fraudulent practices, they can file a qui tam action, which is essentially a lawsuit filed under seal on behalf of the government. The case remains under seal to protect evidence and the identity of the whistleblower. The government may decide to join in the lawsuit or not. Regardless of whether the government joins, the whistleblower is entitled to a percentage of the recovery.

Whistleblowers place a lot on the line in order to bring wrongdoers to justice. Many face retaliation in one form or another for bringing these fraudulent actions to light, despite the fact that it is now illegal to retaliate against whistleblowers under the FCA.

The 2009 FCA Amendment

The FCA has been in existence since the time of Abraham Lincoln. Since then the government has added to and subtracted from this powerful law as via case law decisions and legislative amendments. Before 2009, the FCA only protected individuals who have taken steps in furtherance of a whistleblower action. It did not protect actions to stop illegal behavior.

Protected Activity

The Fraud Enforcement and Recovery Act of 2009 (FERA) expanded on the activities protected under the FCA. For example, prior to FERA, if you noticed false billings and notified your supervisor in an attempt to stop the practice, your employer could fire you because they saw you as a threat. With the 2009 amendment, you are now protected from retaliation if you attempt to report illegal billings to your supervisor. If you are fired, demoted, harassed or otherwise retaliated against for trying to prevent fraud, you have the right to bring a retaliation action against your employer. This would be the same for other contracted agents as well.

You may be entitled to double back pay, reinstatement, attorney fees, and other damages if you are able to prove that you were fired, demoted or otherwise discriminated against for:

  • bringing fraudulent practices to light
  • insisting on changing billings before they are sent
  • telling other employees about the fraudulent practices
  • bringing a qui tam lawsuit

Whistleblowers are powerful allies in the government’s fight against fraud and abuse. For this reason, it does its best to protect the rights of people who put their livelihoods on the line to uncover financial fraud.

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