When should I file my Qui Tam lawsuit?
The False Claims Act states that once a person has filed a qui tam lawsuit, no other person may file “a related action based on the facts underlying the pending action” (31 U.S.C. §3730(b)(5)).
It’s important to consider if there is anyone else – another employee or coworker – that knows what you know about the government’s fraud. Have you talked to anyone else about the information you possess?
Put simply, if you have a good case, proceed expeditiously. There’s little time to waste. If someone “beats” you to filing a case, you will lose your standing.
The statute of limitations for a qui tam action is found in Title 31, Section 3731(b) of the United States Code.
“A civil action under section 3730 may not be brought—
(1) more than 6 years after the date on which the violation of section 3729 is committed, or
(2) more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date on which the violation is committed, whichever occurs last.”
In determining which limitations period applies to an FCA action, courts examine the time at which either the relator or the government became aware or knew of the violation.
RELATION BACK OF GOVERNMENT’S COMPLAINT
If the government intervenes in the FCA action, the government can file its own complaint or amend the complaint of the relator to add details or claims. For statute of limitation purposes, any pleading filed or amended by the government for the purpose of adding new claims will relate back to the filing the date of the relator’s complaint to the extent that the new claims arise out of the same conduct alleged in the relator’s complaint.
Under Section 3731(b)(1), an FCA action must be brought within six years after the date the defendant committed the violation. This limitations period assumes that the qui tam whistleblower or the government has knowledge of the violation. The main issue then becomes determining the proper date that the violation was committed. Most courts hold that the date of submission of the claim is the trigger date for the six-year statute of limitations. However, some courts hold that the statute does not begin to run until the date the claim was actually paid. A few courts even make a distinction based on whether damages or penalties are sought.
THREE YEAR TOLLING PROVISION
In 1986, Congress modified the FCA to include a tolling provision for the statute of limitations, which provided that an FCA action may not be brought “more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act.” The majority of courts have held that the statute’s reference to an official means the responsible official in the Department of Justice. However, a minority of courts have held that other governmental agencies or officials will qualify as an “official” within the meaning of the section. Courts are split over whether a qui tam whistleblower is entitled to take advantage of the tolling provision in Section 3731(b)(2).
For more information and case citations, please see “Federal False Claims Act and Qui Tam Litigation,” published by Law Journal Press (2010).