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WHAT LEGAL PROTECTIONS DOES THE FALSE CLAIMS ACT PROVIDE TO WHISTLEBLOWERS?

April 13, 2022

Exposing unlawful conduct by a business can often create significant monetary exposure for that company and any individual employees engaged in wrongdoing. Whistleblowers who step forward to report such fraud may therefore face retaliation for their decision to do so. This blowback may come after a whistleblower reports his or her concerns internally or it may arise after a whistleblower’s qui tam suit comes out from under seal. But in either scenario (and many others in between), it is important to keep in mind that the False Claims Act will be there to make whistleblowers whole for losses they suffer as a result of their lawful activity.

Specifically, the FCA provides a cause of action for employees, contractors, or agents discharged, demoted, suspended, threatened, harassed, or in any other manner discriminated against for lawful acts performed on behalf of themselves or others in furtherance of a qui tam lawsuit or in an effort to stop an FCA violation. Examples of protected activity include reporting the fraud internally; investigating or initiating a False Claims Act case; or making efforts to prevent, halt, or cure fraudulent conduct.

Indeed, even in the absence of fraudulent conduct by a company, an action taken by a whistleblower will still fall within the scope of “protected activity” under the FCA where it is motivated by an objectively reasonable belief that the perpetrator is violating, or soon will violate, the False Claims Act. Put another way, a whistleblower’s retaliation claim may remain viable even if a court determines that the conduct reported was not a False Claims Act violation after all.

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WHAT IS THE FALSE CLAIMS ACT?

Where successful, relief afforded to a whistleblower under the anti-retaliation provisions of the False Claims Act shall include:

  • Reinstatement with the same seniority status that employee, contractor, or agent would have had but for the discrimination;
  • 2 times the amount of back pay;
  • Interest on the back pay; and
  • Compensation for any special damages sustained as a result of the discrimination, including litigation costs and reasonable attorneys’ fees.

The retaliation damages made available under the FCA supplement the potential for substantial rewards offered by the statute’s qui tam provisions. The prospect of receiving a reward under the False Claims Act provides a critical incentive to potential whistleblowers undertaking the risks to their career that come with reporting fraud. And the protections afforded by the statute’s anti-retaliation provisions provide individuals with additional comfort and security in bringing such fraud to light. It is crucial that we make whistleblowers whole and assure that they are compensated for their courage in reporting misdoing. Without the information and insights they provide, many schemes would go undetected and substantial government funds would remain unrecovered.

If you are considering filing a whistleblower complaint, please fill out our online form or contact us by phone at (215) 567-8300 or via e-mail at zarbitman@feldmanshepherd.com.

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