What Happens in a Qui Tam Case?
Though every qui tam case is different, typically, there are a few steps to the process:
Step A: A private citizen, with non-public information about a business or an individual defrauding the government, contacts a qui tam law firm.
Step B: After gathering the evidence and evaluating the merits of the case and financial stability of the defendant, the whistleblower’s attorney decides whether to enter in contractual relationship with the whistleblower, which is generally done on a contingency fee basis. This includes the qui tam portion as well as any retaliation cause of action.
Step C: If the attorney and whistleblower agree to contractual terms, the attorney will spend a significant amount of time to prepare a disclosure statement for the government and complaint to file with the court.
Step D: The Department of Justice places the lawsuit “under seal” for 60 days (or more, upon the government’s request) to carefully examine the claims.
Step E: During the seal period, the government is encouraged to subpoena records from the defendant company to further substantiate the claims.
Step F: During the seal period the case is not public information, and the accused is not notified. Occasionally, however, the government may request the court to partially lift the seal to discuss the allegations with the defendant and negotiate a potential settlement.
Step G: Typically with the help of the relator’s attorney, the government decides to intervene or not intervene in the case.
Step H: What happens next depends on the government’s decision to intervene.
If the government chooses to intervene, the whistleblower and his/her attorney continue with the case with the assistance of the Department of Justice.
If the government chooses not to intervene, the whistleblower and his/her attorney may continue or dismiss the case as they see fit. Most qui tam firms have no trial lawyers so they generally do not pursue a case after the government has declined to join.