Connecticut False Claims Act
The Connecticut False Claims Act (CFCA)2 is Connecticut’s version of the Federal False Claims Act (FCA).3 The federal and state statutes are similar in many aspects, but there are some differences between the two.
1. LIABILITY AND DAMAGES PROVISIONS
The liability and damages provisions under the CFCA are similar to those under the federal FCA. So, for example, an individual will be liable for knowingly presenting or causing the presentation of a false or fraudulent claim under a medical assistance program administered by the Department of Social Services, or knowingly making, using, or causing to be made or used a false claim under a medical assistance program administered by the Department of Social Services.4 However, unlike the federal FCA, Connecticut’s statute only covers fraudulent claims or payments under medical assistance programs administered by the Department of Social Services, including Medicaid. 5Another difference between the state and federal statutes is that the CFCA does not explicitly exempt false tax claims.6
The damages provision in the CFCA is similar to the statutory language of the federal FCA and allows for treble damages and civil penalties ranging from $5,500 to $11,000 per claim.7 The CFCA also makes a violator liable to the state for the cost of investigating and prosecuting the matter.8 In addition, the CFCA follows the federal statute by providing for the reduction of liability to not less than twice the amount of damages if the defendant voluntarily discloses the violations within thirty days of obtaining the information, if there is no criminal, civil, or administrative action yet taken on the violation, and if the defendant cooperates with the investigation.9
2. PROCEDURAL ISSUES
a. General Procedural Provisions
The CFCA permits a private person to bring a suit under the statute.10 Several provisions are the similar the federal statute, including the required disclosure of material to the attorney general;11 the sealing provisions and a provision allowing an extension of the seal upon a showing of good cause;12 the state’s primary responsibility for litigating the action if it chooses to intervene and the right to limit the relator’s participation;13 and the state’s right to “withdraw such action” over the objection of the relator, as long as the state notifies the relator and provides an opportunity for a hearing.14 The state may also settle the case despite the relator’s objections as long as the court determines that the settlement is “fair, adequate and reasonable under all circumstances.”15 If the state chooses not to proceed, the relator may bring the action.16 However, the government may later intervene, without limiting the status and right of the relator, upon a showing of good cause.17
Like the federal FCA, the Connecticut statute also provides that the government or relator must prove all elements of the cause of action, including damages, by a preponderance of the evidence.18 The state may also explicitly request a stay of proceedings if discovery would interfere with the investigation of a criminal matter arising from the facts and may extend that request if it can show that it has pursued the matter with reasonable diligence.19 In addition, both the federal FCA and the CFCA provide that, if a final judgment was rendered in favor of the government in a criminal proceeding, the defendant is estopped from denying the essential elements of the offense in any action brought pursuant to the statute that involves the same transactions.20
b. Statute of Limitations
Like its federal counterpart, the Connecticut statute provides that an action may not be brought more than six years after a violation of the statute is committed.21 The CFCA also provides that an action may not be brought more than three years from the date when the state knew or reasonably should have known of material facts of the violation.22 The action may not be brought later than ten years after the violation was committed.23 Like the post-FERA federal FCA,24 the CFCA allows the state’s pleading to relate back to the filing date of the relator’s complaint for statute of limitations purposes if the state decides to intervene.25
3. JURISDICTIONAL BARS TO ACTIONS
a. First to File Bar and Bar Against Members of Legislative, Executive or Judicial Branches
Like its federal counterpart, the CFCA provides jurisdictional bars to certain qui tam actions. The CFCA contains a first to file bar26 and a bar prohibiting actions against members of the judicial, executive and legislative branches.27 It also contains a bar against actions based on transactions or allegations that are the subject of another civil or administrative action to which the government is already a party.28
b. Public Disclosure Bar
The CFCA also contains a public disclosure bar that is similar to the public disclosure bar in the federal FCA. The CFCA prohibits a relator from bringing an action if the allegations
“were publicly disclosed (1) in a state criminal, civil or administrative hearing in which the state or its agent is a party, (2) in a report, hearing, audit or investigation conducted by the General Assembly, a committee of the General Assembly, the Auditors of Public Accounts, a state agency or quasi-public agency, or (3) by the news media, except the court shall not dismiss such action or claim if the action or claim is brought by the Attorney General or the person who is an original source of information.”29
The CFCA states that, in order to be an “original source,” the relator must have either 1) voluntarily provided the information to the state prior to the public disclosure or 2) have independent knowledge which materially adds to the publicly disclosed information and which the relator voluntarily provided to the state.30 This is similar to the federal FCA language,31 which was amended in 2010 by the Patient Protection and Affordable Care Act (“the Affordable Care Act”).32
The previous version of the federal FCA required an original source to have “direct and independent knowledge.” In the amended version of the federal FCA, the definition of “original source” was changed and now allows a person to qualify as an “original source” if that person discloses the information to the government before the public disclosure is made or if they have “knowledge that is independent of and materially adds to the publicly disclosed allegations or transactions.”33 Also in the amended version of the federal FCA, the court can only dismiss an action based upon a public disclosure if the government does not oppose the dismissal.34 In addition, qui tam actions based on public disclosures made in non-governmental civil litigation are not barred in the amended version of the federal FCA.35 The state statute mirrors these changes.36
The CFCA provides similar Protections for whistleblowers as the federal FCA and the damages recoverable under the state statute are almost identical to those recoverable under the federal FCA. Damages include reinstatement with the same seniority status and damages necessary to make the employee whole, such as double the back pay, interest on the back pay, and special damages, including litigation costs and reasonable attorney’s fees.37
5. RELATOR’S SHARE
The relator’s recovery under the CFCA is generally identical to the relator’s recovery under the federal FCA. If the state decides to intervene on an action or if the state settles with the defendant, the relator is entitled to fifteen to twenty-five percent of the proceeds.38 If the state declines to intervene, the relator is entitled to twenty-five to thirty percent of the proceeds.39 In either scenario, the relator is also entitled to reasonable expenses incurred, plus reasonable attorney’s fees and costs.40 Both statutes also allow a reduction of the award if the relator “planned and initiated” the violation.41 If the relator is convicted of criminal conduct due to his role in the fraud, the relator shall be dismissed from the civil action and will not share in the proceeds.42 The CFCA allows a successful defendant to recover attorney’s fees and costs if the suit was filed for purposes of harassment or if the suit was frivolous or vexatious.43 Unlike the federal FCA, the state statute does not explicitly allow for a reduction of the award if the suit is based upon public disclosure and the relator is not an original source.44
- Author of treatise,Federal False Claims Act and Qui Tam Litigation, Law Journal Press (2010), research source of the issues discussed in this article.
- Conn. Gen. Stat. Ann. §§ 17b-30a1 to 17b-301p.
- 31 U.S.C. §§ 3729-3733. Federal False Claims Act.
- Conn. Gen. Stat. Ann. § 17b-301b(a).
- Compare 31 U.S.C. § 3729(d).
- Conn. Gen. Stat. Ann. § 17b-301b(b). Compare 31 U.S.C. § 3729(a). The civil penalties under the federal FCA have now been raised to $5,500 and $11,000 to account for inflation. See Chapter 4, supra, for further discussion of this issue.
- Conn. Gen. Stat. Ann. § 17b-301b(c).
- Conn. Gen. Stat. Ann. § 17b-301d(a).
- Conn. Gen. Stat. Ann. § 17b-301d(b).
- Conn. Gen. Stat. Ann. §§ 17b-301e(a) & (d).
- Conn. Gen. Stat. Ann. § 17b-301e(b).
- Conn. Gen. Stat. Ann. § 17b-301e(c).
- Conn. Gen. Stat. Ann. § 17b-301f(a).
- Conn. Gen. Stat. Ann. § 17b-301m. Compare 31 U.S.C. § 3730(c)(4) (the federal FCA states only that the “United States” must prove all elements by a preponderance of the evidence).
- Conn. Gen. Stat. Ann. § 17b-301f(d).
- Conn. Gen. Stat. Ann. § 17b-301n. Compare 31 U.S.C. § 3731(e).
- Conn. Gen. Stat. Ann. § 17b-301l. See also, 31 U.S.C. § 3731(b).
- Fraud Recovery and Enforcement Act, Pub. L. No. 111-21. § 4, 123 Stat. 1623 (May 20, 2009).
- Conn. Gen. Stat. Ann. § 17b-301l. See also,31 U.S.C. 3731(c).
- Conn. Gen. Stat. Ann. § 17b-301d(d).
- Conn. Gen. Stat. Ann. § 17b-301i(a).
- Conn. Gen. Stat. Ann. § 17b-301i(b).
- Conn. Gen. Stat. Ann. § 17b-301i(c).
- 31 U.S.C. § 3730(e)(4)(B).
- Patient Protection and Affordable Care Act (“the Affordable Care Act”), Pub. L. No. 111-148, 124 Stat. 119 (March 23, 2010).
- Pub. L. No. 111-148, § 1303(j)(2), 124 Stat. 119 (March 23, 2010), amending 31 U.S.C. §3730(e)(4).
- Id. Actions based on public disclosures are only barred if they are made in a criminal, civil, or administrative hearing in which the government is a party
- Conn. Gen. Stat. Ann. § 17b-301i.
- Conn. Gen. Stat. Ann. § 17b-301k(a). Compare 31 U.S.C. § 3730(h)(2).
- Conn. Gen. Stat. Ann. § 17b-301e(e).
- Conn. Gen. Stat. Ann. § 17b-301f(b).
- Conn. Gen. Stat. Ann. §§ 17b-301e(e) & 17b-301f(b).
- Conn. Gen. Stat. Ann. § 17b-301h.
- Conn. Gen. Stat. Ann. § 17b-301f(c).
- Compare 31 U.S.C. § 3730(d)(1).
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