Qui Tam - FAQs

	President Barack Obama has signed into law the Fraud Enforcement Recovery Act (FERA), strengthening your ability to go after fraudulent contractors. Read More
	NJ becomes the 22nd state to enact a false claims act. Read More
	Whistleblowers are responsible for nearly 78% of recoveries made by the U.S. Government in 2008. Read More
	The U.S. Government has recovered over $21 Billion since 1986, $2.2 of that recovery went to whistleblowers. Read More
	The IRS increases the amount of the award a whistleblower can receive. Read More

•		Aerospace Fraud
•		Construction Fraud
•		Defense Contract Fraud
•		Grant Fraud
•		Health Care Fraud
•		Medicaid Fraud
•		Medicare Fraud
•		Nursing Home Fraud
•		Oil Lease Fraud
•		Pharmaceutical Fraud
•		Procurement Fraud
•		US Postal Service Fraud

For your convenience, we have provided the following Frequently Asked Questions to help you better understand the procedures and details with regard to filing a Qui Tam case. How much money has been recovered the U.S. Treasury as a result of Qui Tam lawsuits? Since the 1986 False Claims Act Amendments, Qui Tam actions have returned nearly $2 billion to the U.S. Treasury. In fiscal year 1997 alone, over $600 million was recovered by Qui Tam cases. What types of activities are covered by the False Claims Act? The primary activities that constitute violations under the False Claims Act are:
1.	Knowingly presenting (or causing to be presented) to the Federal Government a false or fraudulent claim for payment;
2.	Knowingly using (or causing to be used) a false record or statement to get a claim paid by the Federal Government;
3.	Conspiring with others to get a false or fraudulent claim paid by the Federal Government; and
4.	Knowingly using (or causing to be used) a false record or statement to conceal, avoid, or decrease an obligation to pay money or transmit property to the Federal Government. In general, the False Claims Act covers fraud involving any federally funded contract or program, with the exception of tax fraud. While the majority of Qui Tam actions to date have involved Government contracts (most notably, Department of Defense contracts), health care fraud is now the biggest target of Qui Tam suits. A broad array of scenarios can constitute False Claims Act violations. Some examples include the following: a contractor falsifies test results or other information regarding the quality or cost of products it sells to the Government; a health care provider bills Medicare and Medicaid for services that were not provided or were unnecessary; or a grant recipient charges the Government for costs not related to the grant.
Does The False Claims Act Cover Tax Fraud? No. The False Claims Act explicitly excludes tax fraud. Section 3729(e) states that the Act "does not apply to claims, records, or statements made under the Internal Revenue Code." Does the False Claims Act cover waste and mismanagement? No. While the Government undoubtedly loses millions of dollars each year through its own waste and mismanagement, as well as that of outsiders (e.g., Government contractors), the False Claims Act does not provide a remedy for waste or mismanagement that does not rise to the level of fraud. The Act is aimed only at fraud committed against the Government. What is the liability for violating the False Claims Act? Violators of the False Claims Act are liable for three times the dollar amount that the Government is defrauded (i.e., treble damages) and civil penalties of $5,000 to $10,000 for each false claim. Can there be more than one private plaintiff in a particular Qui Tam lawsuit? Yes. More than one person or entity can join together and file a Qui Tam lawsuit. Is there a deadline for filing a Qui Tam action? Under the False Claims Act, an action must be filed within the later of the following two time periods:
1.	Six years from the date of the violation of the Act; or
2.	Three years after the Government knows or should have known about the violation, but in no event longer than ten years after the violation of the Act. (However, at least one circuit court has interpreted the second provision to require that Qui Tam actions be filed not later than three years after the Qui Tam plaintiff, rather than the Government, knows or should have known about the violation.) Further, if before you file, someone else files a False Claims Act lawsuit or helps to publicize allegations similar to yours, you may lose your right to bring a Qui Tam suit.
How long does a Qui Tam action take? The time from the filing of a Qui Tam action until its resolution varies greatly from case to case. One should, however, be prepared for a Qui Tam action to take years, sometimes as many as five or more. It is true that some Qui Tam actions are settled relatively quickly (e.g., within a year of filing), especially when the Government decides to intervene. But, in general, one would be wise not to expect a quick resolution. Do I have to report the fraud that I know about to the Government or my employer before filing a Qui Tam action? In general, the False Claims Act does not require you to report the fraud before filing a Qui Tam action. However, there are circumstances in which you must, or would be wise to, inform the Government before filing. You may wish to speak with an attorney about this issue. Have I lost my right to bring a Qui Tam action if I have already informed the Government about the fraud committed by the potential defendant? No. You do not give up your right to bring a Qui Tam action by going to the Government before filing your Qui Tam lawsuit. You should be aware, however, that you are barred from bringing a Qui Tam suit based upon allegations or transactions which are the subject of a False Claims Act suit already filed by the Government. So, if you deliver your information to the Government before filing a Qui Tam action, and the Government in turn files a False Claims Act action before you file, then you will have lost your right to bring a Qui Tam lawsuit. Can I keep my identity a secret if I file a Qui Tam action? If you file a Qui Tam action, the Government will know your identity, and your name will likely be disclosed to the defendant at some point. During the initial seal period, (under the law) the defendant is not supposed to learn that you have filed the lawsuit; however, (in practice) defendants sometimes figure it out. After the seal period ends, when the Government announces its decision regarding intervention and the complaint is served on the defendant, your identity will be revealed. There are circumstances in which you may be able to file a Qui Tam action and then voluntarily dismiss it during the seal period without having your identity ever revealed to the defendant, but there is no guarantee of anonymity. Will the wrongdoer(s) go to jail because of my Qui Tam action? A Qui Tam suit is a civil action, not a criminal action. As such, imprisonment is not a remedy. Filing a Qui Tam action may, but does not necessarily, trigger a criminal investigation and prosecution by the Government which could lead to jail time for the wrongdoer(s). Any criminal action would be separate from the Qui Tam action, and you would have no control over it. However, you may be asked to assist in the Government's criminal action. How much does it cost to file a Qui Tam action? Because most relators cannot afford to pay hourly fees as they are incurred, most Qui Tam attorneys accept a contingency fee; that is, the attorney gets paid only if there is a recovery, with the fee being some percentage of what you are awarded. With a contingency arrangement, you still may have to reimburse your attorney for out-of-pocket expenses (e.g., filing fees, travel, experts). This information is for educational purposes. It is not offered as and does not constitute legal advice or legal opinions. You should not act or rely upon this information without seeking the advice of an attorney.

© 2002. All Rights Reserved. Levy, Phillips & Konigsberg, LLP
New York - 800 Third Avenue, 13th Floor, New York, NY 10022 - 42 Park Place, Goshen, NY 10924
New Jersey - Quakerbridge Executive Center, 101 Grovers Mill Road, Suite 105 Phone: 1.800.575.9707 Fax: 609.720.0457

Designed, Developed and Hosted by The Web Stop