In qui tam defense cases under the False Claims Act (FCA), defendants face a unique set of challenges and opportunities that require strategic planning from the earliest stages of litigation. The first critical phase is during the investigation period when the case remains sealed. During this time, the government decides whether to intervene in the lawsuit based on evidence provided by the relator. A key defense strategy at this stage involves proactively gathering exculpatory and mitigating evidence that can be presented to the Department of Justice (DOJ) to influence its decision-making process.
One effective approach is to engage former government officials or FCA experts to conduct a thorough investigation into the allegations, focusing on identifying any weaknesses in the relator’s claims. This can include verifying factual inaccuracies, obtaining declarations from current and former employees who have firsthand knowledge of relevant events, and reviewing internal company documents that may contradict the relator’s assertions.
Once the case is unsealed and a complaint is filed, defense counsel should consider filing pretrial motions to challenge the legal sufficiency of the allegations. A motion to dismiss under Rule 12(b)(6) can be particularly effective if the complaint fails to meet the heightened pleading standard required for FCA cases. Additionally, challenging the public disclosure bar and original source requirement are critical at this juncture.
The public disclosure bar is a significant hurdle that qui tam relators must overcome to have standing under the False Claims Act. To defend against these claims, counsel should meticulously review all publicly available information prior to the filing of the complaint to demonstrate how such disclosures influenced the timing and substance of the allegations. This includes scrutinizing media reports, press releases, congressional testimony, and any other public forums where similar issues may have been discussed.
Similarly, establishing that a relator does not meet the original source requirement can be decisive in securing dismissal or limiting the scope of liability. The original source requirement mandates that the relator must possess direct and independent knowledge of the information on which their allegations are based, separate from any public disclosures. By thoroughly investigating the relator’s background, work history, and any prior interactions with government officials, defense counsel can undermine their credibility as an original source.
As the case moves towards trial, challenging the admissibility and sufficiency of the government’s evidence becomes paramount. This includes scrutinizing all documents provided by the DOJ for relevance and compliance with discovery rules, while also preparing to cross-examine relators and other witnesses who may testify on behalf of the government. Utilizing expert testimony can help counterbalance any technical or statistical assertions made by the plaintiff.
At trial, a robust defense strategy will focus on presenting a narrative that highlights compliance efforts within the company, challenges the credibility of the relator’s claims through impeachment techniques, and demonstrates that any alleged misconduct was either inadvertent or justified under industry standards. Emphasizing corporate integrity programs, cooperation with