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False Claims

The federal government has a strong interest in preventing fraud by government contractors. But the government is not always in position to know of fraud. As a result, the False Claims Act was enacted to allow individuals to bring suit against government contractors – either individuals or business entities – who have submitted false claims to the government. These suits are often called “qui tam” actions, which shortens a Latin expression meaning essentially to sue on behalf of oneself and of the government.

Normally individuals cannot sue on behalf of the government, let alone receive a reward for doing so. Only in a narrow set of circumstances, such as in the case of government contractor fraud, can an individual sue on his or her own behalf and that of the government. Other qui tam actions exist in very limited situations – for example, where products are falsely marked as “patented” or for arming an enemy of the United States.

The False Claims Act creates an incentive for “whistleblowing,” or bringing suit against fraudulent contractors. Under the Act, successful plaintiffs receive a percentage of what monies are recovered for the government. In some situations this can create a very strong incentive. While there are provisions in the False Claims Act that protect against retaliation by an employer, choosing to “blow the whistle” and bring suit is a personal and professional risk.

A qui tam suit should contain significant detail about the fraud. The suit is filed under seal, and not even the defendant initially knows of the suit. The Department of Justice is notified of all qui tam suits, and investigates the claim. The government then has the option to intervene in the case and assume the position of the plaintiff. The original individual who brought the suit still receives some portion of the recovery. If the government does not intervene and the original plaintiff continues to pursue the case, he or she may receive a larger portion of the recovery, along with attorneys’ fees, if the case is successful.

With the ever-growing number of government contractors and outsourcing of government functions, qui tam actions continue to be an effective way for the government to discover fraudulent contracting practices. By law, a qui tam plaintiff may not represent him- or herself, but must have an attorney.

New Jersey and New York both have state false claims acts to protect against fraud against state government. New York City also has a false claims act. These statutes have been enacted relatively recently, and generally take guidance from the federal False Claims Act.

Bringing a whistleblower suit as a qui tam action takes courage. It is not easy to stand up against unscrupulous practices by one’s employer, particularly when – as is often the case – the employer is a large entity with deep resources. If you are considering bringing a whistleblower suit, you should consult with an experienced New Jersey or New York qui tam and False Claims Act attorney. At Resnick Law Group, PC we have successfully represented employees in numerous whistleblower suits, including suits under the federal and state False Claims Acts. We understand the procedural intricacies of these claims, and the personal risk involved. We will provide you with the insights of over 25 years of legal experience, and will personally oversee every aspect of your case. For a confidential consultation, call our New Jersey office at (973) 781-1204, or our New York office at (646) 867-7997.

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