False Claims Act

Overview

The U.S. Department of Justice has recovered billions of dollars in False Claims Act (“FCA”) settlements and judgments in civil cases involving alleged fraud against the government.

2018 marked the ninth straight year of more than $2 billion recovered annually under the FCA, bringing the total recovery since 2010 to $35.4 billion. On top of these sums, nearly 800 new FCA matters were initiated last year, more than 84% of which were actions brought by private whistleblowers seeking bounties under the FCA’s qui tam provisions. Not to be left behind, most states have enacted their own false claims laws including qui tam provisions, and state FCA claims are expected to rise.

More than $35 Billion: U.S. Justice Department Recoveries for False Claims Act Cases in the Past Nine Years.

Today, virtually any company or person receiving federal or state funds may be at risk of an FCA investigation or lawsuit, including traditional targets in healthcare and government contracting. With the potential for treble damages and penalties, as well as collateral consequences from suspension and debarment to exclusion from Medicare and Medicaid programs, the stakes for companies have never been higher.

How We Can Help

False Claims Act

For more than two decades, Blank Rome has represented companies and individuals in FCA investigations and litigation. Our False Claims Act practice draws upon the experience of many former federal prosecutors and leverages capabilities from the Firm’s government contracts; state, federal, and joint investigations; and white collar defense practices to provide comprehensive service and advice to our clients.

Our Focus

We have a successful history of resolving FCA matters for clients prior to intervention and often short of litigation. When litigation is necessary, we draw on a seasoned team of trial attorneys, many of whom are former prosecutors, and litigate aggressively in federal and state courts around the country. We also have substantial experience resolving suspension and debarment cases and similar eligibility matters (including Medicare and Medicaid exclusions) that may arise from an FCA case.

Our Services

We successfully represent clients against FCA allegations involving virtually all forms of alleged misconduct:

  • cost and labor mischarging
  • false representations and certifications
  • GSA Schedule violations (including those based upon pricing and discounting disclosures)
  • kickbacks
  • Medicare/Medicaid fraud
  • organizational conflicts of interests
  • Truth in Negotiation Act violations

Our clients span industries, including: 

  • professional services
  • hardware and software
  • logistics
  • finance
  • pharmaceuticals
  • medical/surgical devices
  • healthcare services

Procurement Fraud

Our Chambers USA-ranked Government Contracts Practice handles procurement fraud matters involving civilian and defense agencies. We draw on our deep insight into the unique statutes, regulations, and other contracting requirements that underlie FCA actions to build the strongest possible defense.

Healthcare

In the healthcare sector, Blank Rome has represented pharmaceutical and biologics companies, medical/surgical device manufacturers, clinical laboratory companies, hospitals, wholesalers, distributors, and other providers in a wide range of matters including allegations of Medicare/Medicaid fraud. 

Interdisciplinary Approach

Blank Rome also has unique experience in resolving state FCA investigations and litigation through our state, federal, and joint investigations and white collar practices.
 

Experience

  • A leading private security, training, risk assessment, and solutions provider in a litigation in the U.S. District Court for the Eastern District of Virginia involving claims of retaliatory discharge under the FCA by former employees. The plaintiffs alleged that they were wrongly discharged for reporting that the company submitted false results of weapons qualifications testing under a State Department contract in Afghanistan. After extensive negotiations, the matter was successfully settled for a fraction of the amount demanded by the plaintiffs. Related to that matter, the firm also represented the client in connection with an investigation by the Department of Justice and the State Department’s Inspector General under the FCA into similar allegations regarding weapons qualifications testing.
  • A global pharmaceutical company in one of the largest and longest-running FCA cases in history under the Medicare and Medicaid programs related to Average Wholesale Pricing (“AWP”) of drugs. This qui tam case remained under seal for more than a decade. Although the government intervened in cases against many other pharmaceutical companies, we convinced them not to intervene against our client. This case produced numerous federal and state private class actions, federal multidistrict litigation proceedings, and multiple state FCA actions. We litigated these cases, narrowed the issues and damages, and achieved a very favorable resolution of the matters.
  • One of the largest systems integrators in the world in FCA litigation related to technology alliances, which was part of a series of cases involving the largest procurement-related FCA litigation in recent history. The case included allegations of kickbacks, defective pricing, false statements, and anti-competitive activity and involved dozens of government contracts. We successfully resolved the case through aggressive motions practice, litigation, and mediation.
  • One of the world’s largest software companies in parallel criminal and civil FCA actions involving GSA Schedule contract pricing and discounts. We prepared witnesses for grand jury appearances and made detailed presentations that convinced the government to resolve the matter without criminal liability. We then successfully resolved the civil FCA claims without litigation and at a fraction of the government’s demand.
  • The world’s largest container shipping company in an FCA suit related to charges for cargo shipped to Iraq and Afghanistan—part of a series of cases involving the largest alleged fraud linked to the wars in Afghanistan and Iraq. We successfully negotiated a resolution of the matter before the case was unsealed and litigation began.
  • A major hardware and software reseller defending FCA claims based upon alleged violations of the Trade Agreements Act. The case was dismissed early based on our aggressive procedural motions.
  • An international software, hardware, and networking company accused of false claims relating to GSA Schedule contract pricing and discounts. Following the receipt of subpoenas and Civil Investigative Demands, we prepared witnesses, defended depositions, and convinced the government to resolve the matter at a substantially reduced amount.
  • A fighter aircraft manufacturer concerning allegations of illegal gratuities, labor mischarging, and improper progress payment requests. The district court granted our motion to dismiss, and we successfully defended that dismissal in the court of appeals.
  • A leading engineering services company defending allegations of false claims under a fixed-price contract. We secured a summary judgment ruling on behalf of our client and established favorable authority regarding the application of the FCA to fixed-price contracts.
  • Three major pharmaceutical companies accused of FCA violations relating to the Medicare and Medicaid program, and other state and federal health care billing fraud. We served as settlement counsel and successfully resolved the matters for all three companies.

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