radar-20111-300x298THE CASE LAW

Government going for the big bucks

Look for more lawsuits under the False Claims Act, some of which can rake in the big bucks.

There’s no shortage of people who think they have an inside track on their employers’ wrongdoing, and who want to make a federal case out of their complaints.

And the government is standing by to swoop in when the employee, or “relator,” in FCA parlance, demonstrates that he knows what he’s talking about. That’s the model for the FCA, in which the relator, often a former employee, files suit under seal alleging fraud on behalf of the government.

The Justice Department reviews the case and pursues the action if it believes it has merit. If the government rejects the case, it is unsealed and the relator can attempt to make the case on his own. Getting the government in on the suit is crucial, lawyers say, since it has the resources to develop the case.

One of the biggest FCA wins of last year started just outside Richmond, and led to Virginia lawyer Phil Marstiller ultimately winning a $313 million settlement for a pharmaceutical kickback scheme.

The Justice Department reported that it collected $2.3 billion from FCA suits during the fiscal year that ended Sept. 30, largely on claims brought against companies that allegedly defrauded the government. When the government wins its case, the relator who initiated the suit – and the lawyer – win a cut, too.
Lawyers looking for whistleblowers advertise online, and business likely will continue to pick up in the coming year.

From Virginia Lawyers Weekly Feb. 14, 2011: Trendspotting 2011