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The Qui Tam Action under the Federal False Claims Act: Brief Overview

“Qui tam” is the process by which an individual sues or prosecutes in the name of the government and shares in the proceeds of any successful litigation or settlement.  The name “qui tam” comes from the shortened version of a Latin phrase which roughly translates to “he who prosecutes for himself as well as for the King.”

The False Claims Act provides, inter alia: “Any person who (a) knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval; [or] (b) knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or fraudulent claim…is liable to the United States Government for a civil penalty of not less than $5,000 and not more than $10,000…plus 3 times the amount of damages which the Government sustains because of the act of that person[.]”  31 U.S.C. Section 3729(1)(a), (b).

Section 3730 of the False Claims Act sets forth that a private person may bring a civil action for a violation of Section 3729 for the person and for the United States Government.  31 U.S.C. Section 3730(b)(1).  The private person is known as a “Relator.”  The Government may elect to intervene and proceed with the action within 60 days after the Relator provides a copy of the Complaint and a written disclosure of substantially material evidence and information the Relator possesses.  31 U.S.C. Section 3730(b)(2).

The statute provides substantial rewards to a qui tam plaintiff.  Under Section 3730(d): “If the Government proceeds with an action brought by a person under subsection (b), such person shall…receive at least 15 percent but not more than 25 percent of the proceeds of the action or settlement of the claim, depending upon the extent to which the person substantially contributed to the prosecution of the action.”  31 U.S.C. Section 3730(d)(1).  “If the Government does not proceed with an action under this section, the person bringing the action or settling the claim shall receive an amount which the court decides is reasonable for collecting the civil penalty and damages.  The amount shall be not less than 25 percent and not more than 30 percent of the proceeds of the action or settlement and shall be paid out of such proceeds.  Such person shall also receive an amount for reasonable expenses which the court finds to have been necessarily incurred, plus reasonable attorneys’ fees and costs.  All such expenses, fees, and costs shall be awarded against the defendant.”  31 U.S.C. Section 3730(d)(2).

If you have knowledge of a violation under the False Claims Act and seek more information about bringing a qui tam action, please contact the experienced lawyers at Sidkoff, Pincus & Green in Philadelphia, who are licensed to practice law in all courts in Pennsylvania and New Jersey.