Trial Lawyers Prosecuting Qui Tam Cases

Hundreds of Millions Recovered for the Government and Whistleblowers

Historical Overview of the False Claims Act and Qui Tam provisions

From its earliest beginnings, the False Claims Act (“FCA”) has been an effective weapon in combating fraud perpetrated against the federal treasury. It is one of the few remaining statutes permitting private individuals, or qui tam whistleblowers, to bring suit on behalf of the Government and share in a percentage of the recovery. Since its early enactment in 1863, through the Civil War and two World Wars, the FCA has been the source of vigorous debate, with three major statutory revisions occurring in 1943, 1986, and 2009. Its advocates continue to proclaim its triumphs and pronounce its utility, while its detractors continue to denounce qui tam whistleblowers bringing lawsuits under it as mere profiteers. One fact, however, has remained constant, throughout the FCA’s many evolutions. Fraud practiced upon the Federal Government continues to be a major source of consternation, with the only change being the perpetrator.

In the early years, the major perpetrators were Government insiders, whether by proactive participation or passive silence, through the procurement of the necessities of war. Currently, corporations are the major offenders. They commit procurement fraud through a broad spectrum of Government contracts, primarily involving defense contractors, Medicare, and Medicaid reimbursements. Despite the historical fines and penalties, many corporations view the FCA as another cost of doing business.

No matter who is perpetrating the fraud, and no matter how one views the FCA, it is undeniable that the FCA remains the Government’s broadest sword to recover the billions of dollars pilfered every year from the coffers of the Federal treasury. Returns through the FCA to the Federal Government continue at an astonishing pace and have eclipsed $13 billion. Some of the top recoveries have been in the medical arena and have included: 1) $1.7 billion from HCA, Inc., for billing violations and upcoding; 2) $875 million from TAP Pharmaceuticals, for fraudulent drug pricing and marketing of Lupron, a cancer drug; 3) $400 Million from Abbott Labs for defrauding Medicare and Medicaid; 4) $385 million from Fresenius Medical Care for paying kickbacks to dialysis facilities; 5) $325 million from Smithkline Beecham Clinical Laboratories for various kickbacks to doctors and other fraudulent conduct; 6) $1.415 billion in civil damages and criminal fines from Eli Lilly for off-label marketing of Zyprexa; and 7 $2.3 billion in civil damages and criminal fines from Pfizer for off-label marketing of its drugs Bextra, Geodon, Lyrica, Zyvox, and paying kickbacks to doctors to prescribe its drugs Bextra, Geodon, Lyrica, Zyvox, Aricept, Celebrex, Lipitor, Norvasc, Replax, Viagra, Zithromax, Zoloft, and Zyrtec.

The FCA has become a strong deterrent for those who defraud the federal Government. The 1986 amendments have resulted in a dramatic increase in the number of qui tam actions filed and the amounts recovered by qui tam whistleblowers. Since the passage of the 1986 amendments to the FCA, settlements and judgments have recouped in excess of $13.5 billion, including both qui tam and non-qui tam settlements and judgments. The qui tam settlements and judgments alone total $8.0 billion. The 2009 amendments expand FCA liability and the investigative tools available for FCA prosecution, which will likely cause an increase in the number of qui tam actions filed. To view more statistics on qui tam and False Claims Act recoveries and cases filed to date, please see Qui Tam Statistics.

For more information, email quitam@bafirm.com.


Notice

This website is designed to provide general information only. This information is not and should not be construed to be legal advice. The transmission of the information found on this website also does not result in the formation of a lawyer-client relationship.

You should be aware that qui tam claims are subject to a Statute of Limitations. The area of limitations periods is complex. There are also first to file rules, public disclosure bars, original source issues, and varying limitations in pursuing retaliation claims. If you wish to pursue your claims, you should promptly seek the opinion of an attorney regarding the merits of your qui tam claim and the applicable statute of limitations.