The definition of a public disclosure, and how it affects qui tam/false claims cases, was recently further clarified by a Sixth Circuit court decision.
The False Claims Act allows whistleblowers to bring a civil action in the name of the government, and receive part of the award or settlement if the action is successful. The public disclosure bar restricts a whistleblower from bringing an action if the fraud allegations have already been publicly disclosed.
2010 amendments to the FCA affect the public disclosure bar, including authorizing a court to dismiss claims where the public disclosure bar applies. A court will generally apply a two-part test to determine whether the public disclosure bar applies. First, whether there has been any public disclosure of fraud in a federal hearing in which the government is a party, or in a federal report, hearing, audit, or investigation, or from the news media. The second part concerns whether the allegations in the case are based upon the previously disclosed fraud (this does not apply if the whistleblower/relator was the original source of the information).
The Sixth Circuit recently joined the First, Fourth, Ninth, Tenth, and DC Circuit Courts in ruling that in order for a public disclosure bar to occur, the information had to have been disclosed beyond the government (United States ex rel. Whipple v Chattanooga-Hamilton County Hospital Authority).
Ultimately, this decision is positive news for whistleblowers and relators. The narrow interpretation of public disclosure, and the court’s position that the information must be disclosed beyond the government, may lead to an increase in FCA qui tam actions.
The Evans Law Firm handles qui tam/false claims and whistleblower cases. If you believe you have a qui tam claim, please contact the Evans Law Firm for a free and confidential initial consultation at 415-441-8669, or via email at firstname.lastname@example.org.