A principal tool increasingly relied upon by the federal government to claw back monies from corporations and individuals is the Federal False Claims Act (31 USC §§ 3729-3733), which allows the federal government to bring a civil action directly against companies as well as individuals for alleged false claims, seeking treble damages and thousands of dollars of penalties per violation. In addition, the False Claims Act permits a private party to file what is known as a Qui Tam action, standing in the shoes of the government, and seeking similar redress for such alleged false claims in return for a personal profit to be made by the Qui Tam claimant.
The federal government has utilized these investigations, especially in the healthcare sector, to collect billions of dollars from companies and individuals, through an expensive investigation and litigation process. During the investigation phase, the government uses an investigative tool known as a Civil Investigative Demand to compel production of internal company documents and the depositions of company officers and employees to build their case. These actions under the False Claims Act pose great risks for operating companies and individuals, not only in terms of potentially crippling monetary penalties and damages if found liable, but as well, potential exclusion from federal government programs. In order to be false, a claim need not have been “knowingly” made with actual knowledge or proof of intent to defraud; it is enough that the claim was made with “reckless disregard for the truth” in order to be actionable.
Many states, including the State of Washington have their own false claims statutes, mirroring the federal False Claims Act, also allowing monetary penalties and damages.
These investigations pose complex questions and call for a sophisticated knowledge, strategy, and experience to defend.
Our False Claims/Qui Tam defense team is headed by Ronald Friedman, a former federal prosecutor with over 20 years federal prosecutorial experience, and Brett Elliott, who led several False Claims Act investigations during her time as a trial attorney in the Fraud Section at the U.S. Department of Justice’s Civil Division in Washington D.C., where the nation’s most significant False Claims Act cases are developed and civilly prosecuted.
At Karr Tuttle, Ron and Brett have combined their experience to successfully assist corporations and individuals responding to such investigations. Their experience includes defense in the healthcare and construction industries, and their experience includes all aspects of defense, from conducting an internal investigation on behalf of a business, to formulating a response strategy to the investigation, and successfully interacting with the government to address and resolve the matter.
In addition, Ron and Brett have served as local counsel assisting national counsel responding to such investigations when centered in the State of Washington.
· Represented CFO of international construction company in federal False Claims Act investigation. Following a multi-year investigation, all charges declined.
· Represented national construction company in federal False Claims Act investigation. Following a year-long investigation, the government declined to enter the case and a civil settlement was reached with the qui tam plaintiff.
· Represented medical practice in multi-year False Claims Act and unlawful kickback investigation. No charges brought.
· Assisted national counsel in federal False Claims Act investigation of national medical provider practice. Ongoing.