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Qui Tam

The Qui Tam Provision: What a Whistleblower Needs to Know

What is a qui tam Lawsuit?

A qui tam lawsuit is a type of lawsuit that is brought by a whistleblower on behalf of the government. In cases where the government has been defrauded of funds, a qui tam provision allows anyone with knowledge or evidence of the fraud to file. In return for their service, the law allocates them a share of the funds that are recovered.

Qui tam provisions are relatively rare in US laws. The most prominent and most frequently used qui tam provision is the one that is found in the False Claims Act.

The False Claims Act is a piece of legislation that dates back more than 100 years. It criminalizes the submission of false reports, records, and claims to certain federal programs, and includes a qui tam provision so that whistleblowers may act to seek the recovery of stolen funds when the criminal fraud is committed.

The False Claims Act is frequently used in cases where the defendant is accused of fraud against Medicare, Medicaid and other public programs that are directly funded by the US government.

Who is Allowed to file a qui tam Lawsuit?

Any private citizen with credible allegations may sue an individual or business that is defrauding the government. Sufficient evidence is necessary to file these cases, so you should make sure that you are preserving evidence before you speak to your whistleblower lawyer about getting started.

You will not be allowed to file a qui tam lawsuit if someone else has already filed a case regarding the same allegations. Only the original whistleblower or whistleblowers will be allowed to claim any rewards from the settlements.

What is the Filing Process?

The lawsuits rarely proceed immediately. Even with the evidence that the whistleblower provides, the Justice Department will still need time to investigate the claims.

The government performs its own investigations to determine if they want to participate in the case. If they do participate, in what is known as an intervention, they can use expanded discovery powers to gather their own evidence. They do not intervene in many cases, but when they do, they may push to end the case with a settlement.

What might Prevent a Case from moving Forward?

Whistleblower cases are very complex, and they can take a long time to complete. For that reason, it is important that any possible mistakes are avoided during the process. There are several ways that the case can be delayed or dismissed, that you may want to avoid…

Fraud becoming public before the case is filed

If the fraud becomes public before the case is filed—For example, if a journalist exposes the fraud—then you cannot file suit. Even if you have been collecting evidence for years, you will no longer have any standing to file on the government’s behalf.

Another filer who relies on the same information

If someone has already filed a case involving the same allegations that you’re making, then you will not be able to file yourself. This does not mean that multiple people can’t file qui tam suits as whistleblowers. They just have to file together with the same lawyers representing them.

Expired statute of limitations

An otherwise well-documented claim of fraud can be unactionable if the crimes involved have passed the statute of limitations. The crimes that are covered by the False Claims Act can be difficult to prosecute after 6 years or 10 years depending on the crime.

What Protections do Whistleblowers have against Retaliation

Whistleblowing can take many forms, and several of them are specifically protected under the law. All employees and companies in the US are expected to…

Refuse to take any action that would violate the false claims act (such as the alteration of records or the submission of records for care that was not provided)
Refuse to participate in activities that may constitute kickbacks
Decline to upcode in situations where a less complex treatment would be appropriate

In the early stages of fraud, it may be limited to a single department or even a single manager. This is when it is most appropriate for employees to attempt to correct the behavior from within the organization, as a lawsuit would likely not move forward at this stage.

The FCA defends employees who take actions that include…

Reporting the activity to a supervisor
Gathering information that may be relevant to a future qui tam action
Using workplace authority to attempt to prevent or stop the violation

When employees take such action, they are legally protected from retaliation by their employers, including measures such as reprimands, reassignment, discharge, demotion, suspension, harassment or threats.

If employers retaliate against employees who are attempting to stop fraud, they can expose themselves to additional criminal and civil penalties than those involved with the FCA violations.

In the recent case Smith v. LHC Group, Inc, it was decided that if an employee chooses to resign rather than participate in fraud, that may still be considered an illegal firing by the company, with all penalties that apply.

Is a Whistleblower Lawyer Necessary?

It can be difficult for a whistleblower to prove that the activities that they engaged with were protected, that the action taken against them was retaliatory and that the action taken was specifically a reaction to whistleblowing. However, those conditions are the burden of proof that must be met by any whistleblower bringing an action against their employer.

If successful, the whistleblower may be entitled to full reinstatement, double back pay and the payment of special costs related to attorney fees, distress or other harm.

Whistleblower lawyers focus on these types of cases and typically have more experience navigating them. This may make these lawyers a more effective partner to whistleblowers who have experienced retaliation.