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FCA Whistleblower Retaliation Ruling Raises Stakes for Employers

Phillips & Cohen whistleblower attorneys Claire Sylvia and Emily Stabile analyze a Sixth Circuit Court ruling in a whistleblower retaliation case that could have implications for whistleblowers and employers.

Employers and employees in industries that contract with the federal government should take note of a recent federal appellate court decision: Employers can be held responsible under the False Claims Act (FCA) for post-employment retaliatory actions against former employees who blew the whistle on alleged fraud by the company.

The whistleblower in the Beaumont Hospital case, who is a neurologist, alleged that he experienced blacklisting in retaliation for reporting fraud by the Detroit hospital. In his complaint against the hospital, he contends that after the hospital terminated his employment, it maligned him, jeopardizing his applications to almost 40 academic institutions and future employment in his field.

[The court said] the FCA’s use of the word “employee” contains no temporal limitation, and the framework and purpose of the statute supported interpreting the act to apply to former employees when retaliation is inflicted post-employment.

The decision highlights for employers that post-termination retaliatory conduct could expose them to liability under the FCA. An employer might be required to provide, for example, reinstatement, two times back pay, and other recompense to a former employee if retaliation occurred.

Read the entire article, “FCA Whistleblower Retaliation Ruling Raises Stakes for Employers,” on Bloomberg Law’s website. 

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