Supreme Court to Review Statute of Limitations in False Claims Act Cases
On November 16, the Supreme Court granted certiorari in case that could clarify the confusion surrounding the False Claims Act’s (FCA) statute of limitations. The FCA establishes two distinct statute-of-limitations periods. The Court agreed to review Cochise Consultancy v. United States ex rel. Hunt, a case involving the statute of limitations for the FCA.
Congress passed the False Claims Act to combat fraud in government contracting. The qui tam provisions – or whistleblower provisions of the False Claims Act, permit private parties bring qui tam actions on behalf of the United States when they believe that a party has submitted false claims for government funds, and to receive a share of any recovery. The qui tam relator acts on behalf of the government and can collect up to 30 percent of the money recovered through the whistleblower lawsuit.
Under 31 U.S.C. § 3731(b)(1), an FCA case must be filed within six years of the alleged fraud. But there is an exception to this under 31 U.S.C. § 3731(b)(2), which states that a False Claims Act civil action “may not be brought more than 3 years after the date when facts material to the right of action are known or reasonably should have been known by the official of the United States charged with responsibility to act in the circumstances, but in no event more than 10 years after the date” of the alleged violation.
The question that the justices will decide is whether a qui tam relator can rely on the exception to file a lawsuit under the False Claims Act after the six-year statute of limitations has run in cases in which the government has declined to intervene and, if so, whether the qui tam relator constitutes an “official of the United States” for purposes of Section 3731(b)(2).
Learn more about False Claims Act lawsuits from previous posts.