November 21, 2014 Articles

The Scope of the False Claims Act's First-to-File Bar

The Supreme Court will determine whether the bar functions as a one-case-at-a-time rule

by Bryce L. Friedman and Yafit Cohn

The False Claims Act (FCA) has become an increasingly important and prominent tool in the government's efforts to protect the federal fisc and fight fraud. The FCA's "whistleblower" provisions encourage those with knowledge of purported fraud against the government to come forward at their earliest opportunity so the government is on notice of the alleged fraud and the "whistleblower" (known as a qui tam plaintiff or relator) can share in any recovery. However, allegations of fraud often beget related allegations of fraud. The federal courts have been wrestling with the question of whether seriatim lawsuits against the same defendant based on substantially similar allegations of fraud may be brought by qui tam plaintiffs under the FCA. This question has recently elicited conflicting responses from U.S. circuit courts and is one of two questions that the U.S. Supreme Court signaled it will address when it granted certiorari on July 1, 2014, in Kellogg Brown & Root Services, Inc. v. United States ex rel. Carter, 134 S. Ct. 2899 (2014).

The Court's decision will be important to the increasingly large swathe of companies who do business in one form or another with the United States.

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