Comment: The Standing of Qui Tam Relators Under the False Claims Act
29 Pages Posted: 12 Sep 2008
Date Written: September 10, 2008
The False Claims Act ("FCA") is the federal government's chief defense against fraud. Passed during the Civil War to help deter fraud by defense contractors, the FCA grants a cause of action to the United States to sue for civil damages and penalties against any entity knowingly presenting a fraudulent claim to the government. The qui tam provision of the Act authorizes private individuals to adopt the government's cause of action and sue on behalf of the United States. These qui tam plaintiffs, or "relators," receive a "bounty" of up to thirty percent of the damage award or settlement, plus expenses, attorney fees, and costs of suit.
After the qui tam plaintiff files a complaint, the government retains some control over the suit. The complaint remains under seal for sixty days after it is filed, in order to give the Attorney General time to decide whether to intervene. After the expiration of the sixty days, the Attorney General can elect to conduct the action, in which case the government has primary responsibility for prosecuting the action and is not bound by any action of the qui tam plaintiff. Alternatively, the government can allow the qui tam plaintiff to conduct the action, while retaining the right to intervene at a later date upon a showing of good cause.
Although qui tam has been around for centuries, a recent surge in qui tam litigation under the FCA has prompted defendants to challenge its constitutionality. The attack has come on three fronts: the Article II Appointments Clause, separation of powers, and Article III standing. Lower courts have found the provision constitutional on all three grounds, but have offered little analysis on how a qui tam plaintiff can fulfill Article III standing requirements.
This Comment focuses on the question of whether a qui tam relator can satisfy the Article III standing tests of injury in fact, causation, and redressability. The Comment first outlines the basic doctrine of standing and reviews the treatment given to this issue by the lower courts. Second, the Comment examines the history of standing doctrine to assess the proper role of original intent arguments in this context. This historical evaluation suggests that the lower courts have improperly afforded qui tam a strong presumption of constitutionality. Finally, this Comment shows how modern standing doctrine should be applied to qui tam. After concluding that a qui tam relator cannot fulfill the Article III injury requirement on his own, the Comment recommends the adoption of an assignment theory to allow standing in qui tam suits. Under this theory, qui tam plaintiffs have standing as assignees of the government's injury. Properly limited, the assignment theory gives effect to congressional intent while preserving the integrity of standing doctrine.
Keywords: The False Claims Act, qui tam, relators, bounty, constitutionality, Article II Appointments Clause, separation of powers, Article III standing, injury in fact, causation, redressability, original intent, assignment theory, whistleblower, fraudulent claims, fraud
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