False Claim Whistleblower Case
The “Materiality” Issue
The U.S. Court of Appeals for the Fifth Circuit recently took the rare step of overruling a jury finding of False Claims Act (FCA) liability in a case involving government payment for highway guardrails. See United States ex rel. Harman v. Trinity Indus. Inc., No. 15-41172, 2017 WL 4325279 (5th Cir. Sept. 29, 2017). Evans Law Firm Inc. was not involved in the case in any way. Our whistleblower/qui tam attorneys followed it closely, however, as we represent whistleblowers (also known as “relators”) in False Claims Act cases, including cases of Medicare and Medicaid fraud, and whistleblower cases of tax avoidance schemes and securities and investment fraud. If you have credible information for a whistleblower case, call the Evans Law Firm Inc. today at (415) 441-8669.
One of the main elements in any false claims qui tam case is that the falsehood or omission alleged must be “material.” The False Claims Act defines “material” as “having a natural tendency to influence, or be capable of influencing, the payment or receipt of money or property.” See 31 U.S.C. § 3729(b)(4). The Fifth Circuit in Harman held that the qui tam relators failed to establish the “materiality” applying the U.S. Supreme Court’s decision in Universal Health Services, Inc. v. United States ex rel. Escobar, 136 S. Ct. 1989 (2016). The relators had alleged that the guardrail manufacturers failed to disclose modifications in design and manufacturing, and that the government would not have purchased the guardrails had it known about the changes. The government disagreed with relator’s theory. In fact, after conducting its own analysis prior to trial, the relevant government agency concluded that the guardrails satisfied the applicable standards and were eligible for purchase, despite omissions in the paperwork. In light of the government’s conclusions, the Fifth Circuit concluded that the omissions were not “material”
What The Decision Means
The government’s position and the factual circumstances of the Harman case may be relatively unique. The government’s independent and extensive investigation and conclusions regarding the guardrails were “strong evidence” that the manufacturer’s failure to disclose certain modifications was not “material.” It remains to be seen what the long-term effect of the ruling will be. Whistleblower/qui tam cases such as Harman are often long and very complex. The case must begin with original and credible information of false claims and include hard documentation and other evidence supporting that information. We here at Evans Law Firm have experience with whistleblower and qui tam cases brought under the False Claims Act and US tax laws against tax avoidance schemes. We know what the government looks for in these cases and know how best to structure, organize, and present your evidence and documentation through initial application or complaint, discovery and investigation, and trial.
If you or a loved one has information regarding a whistleblower or qui tam case in California brought under the False Claims Act or under the Internal Revenue Code for prosecution of tax avoidance schemes including offshore schemes, contact the Evans Law Firm whistleblower and qui tam attorneys at (415) 441-8669, or by email at <a href=”mailto:email@example.com”>firstname.lastname@example.org</a>. Our attorneys have experience with complex financial contracts and large insurance companies. We can help guide your case through a jury trial or toward an equitable settlement. We handle cases involving physical and financial elder abuse, qui tam and whistleblower law, nursing home abuse, whole life insurance and universal life insurance, and indexed, variable, and fixed annuities.