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What Is a Qui Tam Lawsuit?
Definition & Facts for Whistleblower

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Qui tam lawsuits, also known as whistleblower lawsuits, are a type of lawsuit brought by a private citizen on behalf of the government through the False Claims Act. 

Our law firm has represented many individuals in qui tam lawsuits, and we know how important it is to understand this type of action. For a deeper explanation of the qui tam lawsuit, keep reading this article.

Summary of the Key Findings

  • A qui tam lawsuit is a type of lawsuit in which a whistleblower sues on behalf of the government.
  • If the whistleblower successfully proves the fraud, they may be entitled to a portion of the recovery per the False Claims Act.
  • A whistleblower who is the subject of retaliation may also have a claim for employment discrimination.

Qui Tam Lawsuits

A person talking to a lawyerA qui tam (pronounced “kee tam” or “kwee tam”) lawsuit is a type of legal action that enables private individuals to sue on behalf of the government in fraud cases.

The term “qui tam” is derived from a Latin phrase, “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” which is translated as “he who sues for the king as well as for himself [1].”

Qui tam lawsuits are typically filed by whistleblowers who have witnessed firsthand instances of fraud or corruption. In order to file qui tam lawsuits, the whistleblower must have evidence to support their claims.

If the qui tam claims are successful, the whistleblower may be eligible for a portion of the damages recovered by the government.

While qui tam actions can be beneficial in combating fraud, they can also be very complex and time-consuming. They are generally based on the False Claims Act qui tam provisions which have very specific requirements. As such, it is important to consult with an experienced attorney before taking any action.

False Claims Act

The Federal False Claims Act is the most well-known qui tam statute, and it allows whistleblowers to sue companies or individuals who have defrauded the government. If the lawsuit is successful, the whistleblower may be awarded a portion of the damages recovered by the government.

The False Claims Act was first enacted and signed into law by Abraham Lincoln in 1863. It was created to fight the rampant defense contractor fraud put upon the Union army during the Civil War [2].

The False Claims Act has been amended several times since then. They passed the most recent amendment in 2010, and it includes a number of significant changes in the qui tam provision that have made it easier for whistleblowers to succeed in their qui tam cases.

Fraud

A person handcuffed holding moneyFraud is a type of white-collar crime that can be defined as an intentional misrepresentation of material facts with the intent to deceive.

Fraud can take many forms, but some common examples include healthcare fraud, securities fraud, and tax fraud. 

Qui tam lawsuits are often filed in healthcare False Claims Act cases, as this is an area where fraud can have a significant impact on taxpayers.

In order to prove a qui tam case, you must prove five separate elements:

  • That the defendant made a false or fraudulent claim
  • That the defendant knew the claim was false
  • That the defendant intended to defraud the government by making the false claim
  • That the government justifiably relied on the defendant’s claim 
  • That the claim caused damages to the government.

Successful qui tam cases in federal court provide whistleblower rewards as financial incentives to pursue these cases. They also will give money for reasonable attorneys fees and litigation costs.

Examples Of Fraud in Qui Tam Lawsuits

Money on a table with handcuffs on top

Some examples of fraudulent claims that the Federal False Claims Act qui tam provisions would cover include:

  • Billing the government for services that were not provided
  • Upcoding (billing for a more expensive service than was actually provided)
  • Double billing or paying less than is owed on United States government contracts
  • Providing substandard goods or services for federal programs
  • Submitting a false application for government loans and grants
  • Procurement fraud on a government contract

All of these are illegal and deceptive acts that the perpetrator does so they can gain an advantage over government funds.

“Any person who knowingly submits false claims to the government is liable for double the government’s damages plus a penalty of $2,000 for each false claim.” – U.S. Department of Justice.

Whistleblowers in Qui Tam Lawsuits

An attorney talking to another personThe person bringing the suit as the qui tam plaintiff is also known as a whistleblower. A whistleblower must be someone who has specific knowledge of the fraudulent activity.

Usually, this is someone who works for the company that is committing fraud or has done business with the company. However, the False Claims Act allows it to also be a competitor, a former employee, or anyone else with information about the scam.

In order to encourage qui tam whistleblowers to come forward, False Claims Act lawsuits allow whistleblowers to receive a portion of any damages recovered by the government. The amount of the award depends on several factors. These include the severity of the fraud and the extent to which the whistleblower assisted in the investigation.

Per the False Claims Act, the whistleblower must have evidence of the fraudulent activity. This evidence can take many forms, but it must be specific and direct enough to prove that fraud has occurred.

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Protection For Whistleblowers

The False Claims Act includes a number of provisions to protect whistleblowers from retaliation. These provisions make it illegal for companies to fire, demote, or harass qui tam whistleblowers who come forward to the federal district court with information about fraud. 

If a whistleblower is retaliated against, they may be able to sue the company and recover money. These damages can include double lost wages, job reinstatement, and legal fees.

A whistleblower should engage a law firm and form an attorney-client relationship in order to ensure whistleblower protection under federal rules.

FAQs

What is a common term for the private individual who starts a qui tam lawsuit?

The common term for the private individual who starts a qui tam lawsuit is “whistleblower.” However, “relator” is the legal term for the private person pursuing qui tam cases on behalf of the government.

What are qui tam rewards?

Qui tam rewards are the rewards given to whistleblowers as an incentive to come forward with information about fraud against the government. These incentives range from 15% to 30% of the total amount recovered. 

The amount depends on whether the government joins the qui tam case, how much assistance the whistleblower provides, whether there is a settlement or court trial, and other factors.

The False Claims Act states that these incentives only apply to the first person to file a qui tam action, so it is better to act and contact a lawyer quickly if you have information about fraud. 

What is the qui tam statute of limitations?

The qui tam statute of limitations is generally six years from the date of the fraud or three years from the date when the federal government should have known about the fraud, whichever is later. However, this rule has some exceptions, so it is essential to speak with an attorney to determine your case’s applicable statute of limitations.

What are qui tam attorney fees?

Qui tam attorney fees vary depending on the facts of the case and the lawyer’s experience. However, most qui tam lawyers work on a contingency fee basis, which means they only receive a portion of the recovery if the qui tam case is successful.

What is qui tam in healthcare?

Qui tam in healthcare refers to a qui tam lawsuit that is brought against a healthcare provider for defrauding the government. 

Healthcare fraud includes a wide variety of activities, including Medicare fraud and Medicaid fraud, billing for unnecessary procedures, illegal marketing of medications, and upcoding medical visits.

This civil procedure can also be brought against pharmaceutical companies.

Related Article: Pharmaceutical Giants Pay Billions in Fraud Fines

See the other dangerous drug lawsuits our lawyers have taken on.

Your Qui Tam Lawsuit

If you have direct evidence of fraud against the government, you may be able to start a qui tam action. Further, you may be eligible for a portion of any recovery. We help whistleblowers safely report fraud. To learn whether you may be qualified to bring one, contact one of our experienced qui tam lawyers today and get your free consultation.


References:

1. https://www.upcounsel.com/legal-def-qui-tam

2. https://www.justice.gov/civil/false-claims-act

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