False Claims Act Litigation

False Claims Act Litigation

What is False Claims Act litigation?

False Claims Act (FCA) litigation is a type of legal action where individuals, organizations, or businesses can be held liable for submitting false or fraudulent claims for payment to the government. The FCA provides incentives for whistleblowers to come forward and report fraudulent claims, with the potential to receive a share of any money recovered. In bet-the-company litigation, FCA litigation can have significant consequences such as facing substantial penalties charges, exclusion from government contracts, or even criminal charges.

FCA litigation can arise from various situations. Some examples include healthcare fraud and defense contractor fraud. Healthcare fraud involves individuals submitting false claims for services not rendered or not medically necessary. In defense contractor fraud, companies can be held liable for submitting false invoices or providing defective products.

Need help with False Claims Act litigation? Schedule your consultation today with a top bet-the-company litigation attorney.

What measures must a business take to prevent False Claims Act litigation?

Businesses should take the following steps to prevent FCA litigation:

• Establish a compliance program tailored to the company’s size and risk profile. This program should include regular employee training on identifying and reporting potential fraudulent conduct.
• Conduct regular audits and risk assessments to identify potential risk areas and address them before they become problematic.
• Implement robust record-keeping practices to ensure accurate billing and invoicing.
• Develop policies and procedures that address the specific risks faced by the company, such as conflicts of interest, kickbacks, and other fraudulent activities.
• Implement a reporting system that allows employees to report potentially fraudulent activity anonymously without fear of retaliation.
• Respond quickly and thoroughly to any allegations of fraudulent conduct and take appropriate corrective action.

What legal issues typically arise related to False Claims Act litigation?

The following disputes are among the most common in actions regarding False Claims Act litigation in bet-the-company litigation matters:

• Falsifying Information: One of the most common situations that lead to litigation under the False Claims Act is when a company knowingly submits false or fraudulent claims for payment to the government. Examples may include situations where a company bills the government for undelivered services or products or over-represents the amount of a delivered product.
• Kickbacks and Bribery: Another common situation that leads to FCA litigation is when companies offer or accept kickbacks and bribes in exchange for business. Examples include healthcare providers receiving kickbacks for prescribing certain drugs or contractors receiving kickbacks for awarding government contracts to specific suppliers.
• Failure to Disclose: Companies can also face litigation under the False Claims Act if they fail to disclose information required by the government to receive payment. For example, a company that receives federal grant money but fails to disclose conflicts of interest or other relevant information may be subject to FCA litigation.
• Certification of Compliance: Companies can also face litigation under the False Claims Act if they falsely certify compliance with government regulations or requirements. For example, a healthcare provider that certifies compliance with Medicare regulations but fails to meet those regulations may be subject to FCA litigation.

What is bet-the-company litigation, and how does it apply to False Claims Act litigation?

When a company faces legal action that seriously threatens its future, its survival often depends on winning a single, cost-effective verdict. By necessity, such a company needs counsel experienced in bet-the-company litigation. Bet-the-company cases are often highly confidential, involve multiple parties, and entail complex discovery. High-stakes circumstances like these require risk-reward analysis and comprehensive day-to-day strategizing well above the requirements of traditional business litigation because the company’s existence depends on victory.

While the legal requirements to prove or defend against False Claims Act litigation remain the same, the issues are complex and implicate much more money. For example, mergers and acquisitions, accounting irregularities, changing regulatory interpretations, and antitrust matters may all implicate False Claims Act litigation issues.

What are relevant laws related to False Claims Act litigation in Florida?

The False Claims Act (31 U.S.C. §§ 3729-3733) is a federal law that applies nationwide. However, many states, including Florida, have enacted their own False Claims Acts that mirror the federal law. In Florida, the Florida False Claims Act (Florida Statutes Sections 68.081-68.092) governs FCA litigation and provides additional penalties for violations related to state funds. Other related federal laws include the Anti-Kickback Statute, which prohibits offering or receiving kickbacks in exchange for referrals, and the Stark Law, which prohibits physicians from referring patients to entities in which they have a financial interest.

What is required to prove a case of False Claims Act litigation in Florida?

To successfully file a lawsuit under the Florida False Claims Act, a plaintiff must be an individual, organization, or government entity with information about fraud committed against the government by a defendant. The plaintiff must also be the first to file the lawsuit, and the suit must not have been publicly disclosed before filing.

Procedural Requirements:

A plaintiff must provide a written complaint to the government and the defendant, including a detailed description of the alleged fraud, and file the complaint in court.

Elements of the Claim:

To successfully argue a claim under the Florida False Claims Act, a plaintiff must prove the following elements by a preponderance of the evidence:

1. The defendant presented a false claim for payment or approval;
2. Damages resulting from the false claim.

When a set of facts is appropriate to meet the Florida False Claims Act requirements, there are many paths a claimant may take. We are value-based attorneys at Jimerson Birr, which means we look at each action with our clients from the point of view of costs and benefits while reducing liability. Then, based on our client’s objectives, we chart a path forward to seek appropriate remedies, such as:

• 15% to 30% of the proceeds of the action or settlement of the claim depending on whether the department in question proceeds with an action
• Additional awards of up to 10% of the proceeds if the action is based primarily on disclosures of specific information
• Attorney’s fees and costs

However, the Florida False Claims Act does provide that if a person who planned and initiated the violation brings the FCA action, the court may reduce the share of the proceeds.

To see what actions may be available for your unique situation, please contact our office to set up your initial consultation.

What are common defenses to FCA litigation in Florida?

The primary defenses to False Claims Act litigation in Florida include:

• Lack of knowledge or intent to defraud: a defendant may argue that they did not know or intend to defraud the government. Under Florida law, an innocent mistake can be a defense to claims under the Florida False Claims Act.
• Public disclosure bar: a defendant may argue that the plaintiff filed the lawsuit based on publicly disclosed information, and the plaintiff is not the source of that information.
• Statute of limitations: a defendant may argue that the plaintiff filed the lawsuit after the applicable statute of limitations expired.
• First-to-file bar: this defense prevents a second action based on the same facts underlying an already pending action under the act.

If a business cannot avoid liability under the Florida False Claims Act, it may defend against claims and reduce the potential damages by identifying certain extenuating circumstances provided in Florida law. These include showing that the violator fully cooperated with an investigation or furnished all known information about the violation within 30 days of the person obtaining the information.

To see what defenses may be available for your unique situation, please contact our office to set up your initial consultation

Frequently Asked Questions

1. What are the penalties for violating the Florida False Claims Act and the federal False Claims Act?
   Penalties for violating the federal False Claims Act can include:
   • Treble damages.
   • Three times the amount of damages suffered by the government.
   • Civil fines ranging from $11,000 to $23,000 per false claim submitted.
     Additionally, individuals found guilty of violating the False Claims Act may be excluded from participating in federal healthcare programs and may face criminal charges and imprisonment.

2. How long does the False Claims Act litigation process typically take?
   The duration of FCA litigation process can vary depending on the case’s specific facts. However, some cases have taken several years to resolve.
3. Can an individual file a lawsuit under the False Claims Act, or is it only for the government to file?
   Individuals can file lawsuits under the federal and Florida False Claims Acts, known as qui tam lawsuits. Qui tam lawsuits allow individuals who have knowledge of fraud committed against the government to bring a lawsuit on behalf of the government. If the case is successful, the individual may receive a portion of the damages awarded to the government.

Have more questions about a False Claims Act-related situation?

Crucially, this overview of False Claims Act litigation does not begin to cover all the laws implicated by this issue or the factors that may compel the application of such laws. Every case is unique, and the laws can produce different outcomes depending on the individual circumstances.

Jimerson Birr attorneys guide our clients to help make informed decisions while ensuring their rights are respected and protected. Our lawyers are highly trained and experienced in the nuances of the law, so they can accurately interpret statutes and case law and holistically prepare individuals or companies for their legal endeavors. Through this intense personal investment and advocacy, our lawyers will help resolve the issue’s complicated legal problems efficiently and effectively.

Having a Jimerson Birr attorney on your side means securing a team of seasoned, multi-dimensional, cross-functional legal professionals. Whether it is a transaction, an operational issue, a regulatory challenge, or a contested legal predicament that may require court intervention, we remain a tireless advocate every step of the way. Being a value-added law firm means putting the client at the forefront of everything we do. We use our experience to help our clients navigate even the most complex problems and come out the other side triumphant.

If you want to understand your case, the merits of your claim or defense, potential monetary awards, or the amount of exposure you face, you should speak with a qualified Jimerson Birr lawyer. Our experienced team of attorneys is here to help. Call Jimerson Birr at (904) 389-0050 or use the contact form to set up a consultation.