False Claims Act & Whistleblower/Qui Tam Defense

The federal False Claims Act, or the FCA, has become a powerful tool wielded by federal prosecutors and whistleblowers seeking to investigate and file lawsuits against health care and life sciences providers, government contractors, the defense industry, and a wide range of industries in which government funding is involved. Maynard Nexsen has a seasoned, collaborative team of attorneys who regularly defend and guide clients through all aspects of federal and state fraud matters, from upfront proactive compliance and regulatory advising to investigations and litigation and management of government-imposed compliance obligations. With the threat of FCA treble damages and per-claim penalties looming, Maynard Nexsen’s team is a great full-service partner who can assist with every step of a fraud investigation or lawsuit.

Maynard Nexsen Offers a Collaborative Team of Seasoned False Claims Act Litigators and Regulatory Attorneys

Maynard Nexsen has a deep bench of attorneys who can advise on all aspects of False Claims Act matters and who:

• Have a clear understanding of all relevant regulatory areas and industry practices
• Understand government civil investigations and white collar criminal defense and how to advocate for government declinations or favorable settlements before a matter becomes a public lawsuit
• Can provide seasoned advice and analysis of an FCA or state fraud matter at every stage
• Can assist with implementation or improvement of compliance systems and/or assist with government-imposed compliance obligations, such as a Corporate Integrity Agreement
• Understand how to ensure that employment disputes don’t become whistleblower actions
• Can proactively assist with mitigating FCA risk by assessing and analyzing current risk and/or assisting with implementing or strengthening current compliance systems

Maynard Nexsen’s unique collaborative culture allows these attorneys to work together to resolve matters as efficiently and effectively as possible. Our interdisciplinary team includes:

• Former Assistant United States Attorneys, including former civil and criminal prosecutors
• Seasoned health care and life sciences attorneys, including former in-house counsel
• Experienced employment attorneys
• Well-regarded government contracting attorneys
• Former compliance professionals and attorneys, including former compliance leadership and in-house compliance counsel

Our FCA team has experience in industries where FCA and state fraud investigations often occur, such as health care and life sciences and government contracting.

What is the False Claims Act, and Why Do Companies Need Experienced False Claims Act Lawyers?

The FCA and its state and local equivalents allow the government and private whistleblowers to sue individuals and companies who submit allegedly “false” or “fraudulent” claims for payment to the government. The government or whistleblowers, known as relators, can recover a multiple of the value of those claims plus additional penalties, and the government can seek to bar companies from doing business with the government going forward after an FCA recovery.

What began in the Civil War era as a straightforward effort to protect the government from unscrupulous contractors who provided substandard goods or no goods at all has evolved into a sprawling statutory scheme that allows government entities to seek to extract billions of dollars in settlements and judgments each year from a wide range of companies, many who do not think of themselves as “government contractors.”

FCA matters are not ordinary civil lawsuits and involve a number of unique features, including:

• Whistleblowers may file suits under seal, or secretly, and request the government investigate. This means a company may be under investigation for a period of months or years without even being aware of the investigation.
• Companies may also have to address government investigation requests for documents or testimony via a federal Civil Investigative Demand (CID), which works differently than traditional civil discovery requests.
• Many civil false claims allegations may also be characterized as crimes, including criminal false claims or various forms of fraud. This means that a company facing a civil false claims investigation may also be facing a parallel criminal investigation.
• Whistleblowers, who may be former employees, can bring independent claims for retaliation even if their underlying false claims allegations lack merit.
• Whether the government ultimately prosecutes the case as the plaintiff or declines and allows the whistleblower to proceed on his or her own, the government is always the party in interest and must consent to settlement.
• There are a number of ways that a company can reduce its False Claims Act liability by self-reporting, or cooperating with the government, or presenting the government with information about the company’s compliance efforts.
• Because False Claims Act matters involve potential damages that are three times the value of the claims involved plus penalties, and guilty defendants face the potential of losing their ability to contract with the government, False Claims Act matters rarely proceed down a traditional settlement or trial path and often require unique strategies regarding resolution.

For these reasons, defending an FCA matter often requires counsel with expertise in white collar crime and government investigations, compliance, litigation, employment law, and the relevant regulatory areas that may be implicated in the allegations, from cyber and data privacy to health care to government contracting. Maynard Nexsen’s interdisciplinary team of lawyers who can (and do) collaborate on False Claims Act investigations and matters includes lawyers from the following practice groups: Government Investigations and White Collar Defense, Health Care, Government Solutions and Contracting, Labor and Employment and Complex Litigation.

Regulatory Experience

The federal and state agencies with whom we have worked in FCA matters include:

• Federal Bureau of Investigation (FBI)
• Drug Enforcement Administration (DEA)
• Health and Human Services Office of Inspector General (HHS-OIG)
• Department of Energy Office of Inspector General (DOE-OIG)
• Department of Defense Criminal Investigations Service (DCIS)
• Defense Contract Audit Agency (DCAA)
• Defense Contract Management Agency (DCMA)
• Small Business Administration (SBA)
• State Medicaid Fraud Unit Investigations
• Offices of the United States Attorneys
• United States Department of Justice (DOJ)

• Defended hospitals, hospital systems, academic medical centers, pharmaceutical companies, diagnostic laboratories, physicians, behavioral health providers, physician clinics, private equity firms, nursing homes, and other health care organizations and individual providers under investigation by the DOJ and Office of Inspector General for alleged violations of the Health Care Fraud Statute, False Claims Act, Stark Law, Exclusion Provisions, and the Anti-Kickback Statute
• Defended a defense contractor and financial services firm in connection with a False Claims Act suit and criminal investigation involving multiple U.S. Army contract awards
• Defended a national higher education institution in connection with a False Claims Act suit and government investigation involving alleged violations of Department of Education regulations
• Defended a nursing home chain related to State Medicaid Fraud Unit investigations
• Defended multiple individual physicians and other providers in Exclusion and Preclusion matters
• Assisted several hospitals with the implementation and operation of activities under Corporate Integrity Agreements
• Assisted numerous providers with implementation and/or strengthening of compliance systems
• Defended a national higher education institution in connection with a False Claims Act suit and government investigation involving alleged violations of Department of Education regulations and obtained dismissal of all claims brought under the False Claims Act
• Defended hospital system in connection with a False Claims Act suit and government investigation involving allegations of unnecessary opioid prescriptions and obtained dismissal of all claims
• Defended oncology clinic in connection with False Claims Act suit involving allegations of illegal kickbacks and obtained dismissal of all claims
• Represented individual health care providers during the course of third-party discovery in case involving False Claims Act claims against their hospice employer
• Represented radiation oncology clinic in connection with government investigation brought under the False Claims Act
• Acted as appellate counsel for a hospital system in appeal of False Claims Act case involving a complex question of qui tam procedure on which the courts of appeals are divided
• Represented ophthalmologist related to anti-kickback statute investigation of current and former clinic
• Represented various charitable entities in managing False Claims lawsuits and threatened claims related to the implementation of federal grant funding and alleged deviation from the approved use of such federal funds

Related Practices