Washington, DC — The U.S. Supreme Court agreed to hear United States ex rel. Polansky v. Executive Health Resources, Inc., a case with the potential to significantly impact cases under the False Claims Act.  The court will decide under what circumstances the government can dismiss actions that private whistleblowers bring on behalf of the government and the government chooses not to join, instead of letting the whistleblowers litigate the case on their own.  The Act authorizes the government to dismiss a qui tam case, but the relator must be provided notice and an opportunity for a hearing on the government’s request to dismiss.  Courts have divided on what the government must show to support a request and what a relator must show to successfully challenge such a request.

Statement of Phillips and Cohen Partner Stephen Hasegawa:

“This is an important issue in the fight against fraud, waste, and abuse in government programs. Congress gave whistleblowers rights, including the right to litigate False Claims Act cases and the right to be heard before their cases can be dismissed. If the government can dismiss a qui tam action at any time, for any reason, including after a relator has invested substantial resources in pursuing the case, that could discourage relators and their counsel from pursuing cases at all.

The qui tam provisions of the False Claims Act are intended to incentivize people who are aware of fraud against the government to come forward with their information and pursue cases on the government’s behalf.  Since 1986, relators have recovered over $2.4 billion* for the federal government via claims in which the Department of Justice chose not to intervene.  Giving the government overly broad authority to dismiss valid whistleblower claims under the False Claims Act could hurt taxpayers and undermine the purposes of the False Claims Act. ”

* U.S. Dep’t. of Justice, Fraud Statistics – Overview: October 1, 1986 – September 30, 2018, (Dec. 21, 2018), available at https://www.justice.gov/civil/page/file/1080696/download.

About Phillips & Cohen LLP

Phillips & Cohen represents whistleblowers in SEC whistleblower claims as well as qui tam lawsuits and the whistleblower reward programs of the Commodity Futures Trading Commission and the Internal Revenue Service. Its roster includes the founding Chief of the SEC Office of the Whistleblower as well as former government prosecutors and attorneys with decades of experience representing whistleblowers.

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