POTENTIAL IMPACT OF NEW GUIDANCE ON FALSE CLAIMS ACT CASES

Two new Department of Justice (“DOJ”) Memoranda could have a potential impact on Civil False Act Claims cases, as well as other civil enforcement cases. The two memos are: Memorandum from Michael D. Granston, Director, Commercial Litigation Branch, Fraud Section, “Factors for Evaluating Dismissal Pursuant to 31 U.S.C. § 3730(c)(2)(A),” issued Jan. 10, 2018 (apparently leaked from DOJ and now available on the internet); and Memorandum from Associate Attorney General Rachel Brand, “Limiting Use of Agency Guidance Documents in Affirmative Civil Enforcement Cases,” issued Jan. 25, 2018. First Memorandum Effect on Quit Tam Actions in False Claims Act Cases The first memo deals with factors that the DOJ will consider in determining whether or not to seek dismissal in qui tam suits where the DOJ … Continue reading

SUPREME COURT ADOPTS “IMPLIED CERTIFICATION” WITH MATERIALITY REQUIREMENT

In mid-June, the U.S. Supreme Court adopted the “implied false certification” theory of liability, which treats a contractor’s invoice or other payment request as an implied certification of compliance with relevant statutes, regulations or contract requirements that are material conditions of payments. This theory also treats the failure to disclose a violation as a misrepresentation that renders the claim “false or fraudulent,” and therefore actionable under the Civil False Claims Act, 31 U.S.C. §3729 (the “FCA”). (The FCA permits suits against government contractors if they knowingly present a materially false or fraudulent claim for payment.) The court held that the implied certification theory can be a basis for FCA liability, and can be actionable if the contractor knowing violated a requirement that the contractor knows … Continue reading