False Claims Act Settlements, also known as qui tam settlements, are quite distinct from the standard litigation process. Here’s a basic primer about the particulars, and some of the most frequently asked questions we receive.
What Is the False Claims Act?
The False Claims Act allows individual civilians to file suit on behalf of Uncle Sam to recover funds paid out by the government under fraudulent circumstances. It also protects the individuals exposing the fraud (aka- whistleblowers) from any retaliation from their employer as a result of filing the lawsuit.
What Types of Claims Are Covered Under the FCA?
There are three basic types of claims:
- A classic false claim: when information and documentation submitted to the government is falsified or incorrect.
- Document falsification: using a fraudulent or falsified document to obtain payment from the government.
- Reverse false claims: failure to return funds to the government that were paid, but not owed.
What Components Make Up an Offense Under the False Claims Act?
The following three terms must be met for a suit to succeed:
- The company in question presented a payment request or claim to the government that was false.
- The claim and document itself were
- The company knew the claim was false or fraudulent and presented it anyway.
It’s important to note that payment from the government is NOT one of the required conditions for being considered an offense. The mere act of knowingly making a fraudulent request for payment is enough to create cause for a lawsuit.
What Are the Potential Damages and Penalties If a Defendant Is Found Guilty?
For starters, the government is entitled to three times the amount of its loss. On top of that, there are penalties of $5,000 to $10,000 per incident. The person who originally filed suit (the Relator) may be entitled to a portion of the proceeds as well: up to 30% of the recovered amount, depending on the court’s judgment.
How Does a Qui Tam Lawsuit Differ from a Regular Lawsuit?
There are some differences, but here are a few of the biggest ones:
- It’s filed under seal. This means it’s registered in secret. Only you, your attorney, and the U.S. government know a case has been filed.
- The government has a right to join (intervene) in your case. When the government joins in, it means they believe you have a strong case, and they will carry it through to the end on its own. However, if the government declines to join your case, you are still allowed to see it through to the end on your own; their participation is not a requirement to file suit or receive a judgment.
- You don’t pay your attorney up front. Usually, the attorney will take a percentage of any of the amount recovered. In the event the government declines to join your case, you and your attorney will then need to agree on how to proceed, and whether you will need to cover any of their fees until the final settlement.
Still Have Questions about False Claims Act Settlements?
For more information on False Claims Act settlements, contact the skilled attorneys at Bothwell Law Group by calling 770.643.1606 today.