Civil False Claims and Qui Tam Actions Table of Contents

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1 Civil False Claims and Qui Tam Actions Table of Contents Reprinted with permission from John T. Boese, Civil False Claims and Qui Tam Actions (Wolters-Kluwer Law & Business) (4th ed. 2011). If you would like to order a copy of Civil False Claims and Qui Tam Actions, please contact Wolters-Kluwer by calling or on the web at wolterskluwerlb.com, or write to Aspen Publishers, 76 Ninth Avenue, New York, NY Chapter 1: HISTORICAL OVERVIEW OF THE FALSE CLAIMS ACT 1.01 History: 1863 to 1943 A. The History of Qui Tam and the 1863 Act B to The Hess Case and the Amendments of 1943 A. Codification and Recodification 1.03 The Act Before the 1986 Amendments 1.04 Concern About Fraud and Waste and the 1986 Amendments A. Passage of the 1986 Amendments B. The Lowered Intent/Knowledge Requirement C. Burden of Proof D. The Modified Statute of Limitations E. The Increase to Treble Damages F. Increased Penalties G. Expanded Role, Protection, and Rewards for the Qui Tam Relator H. Other Efforts to Extend the FCA 1. Industry Efforts to Reform the FCA and the Government s Response 2. Expansion of Civil Investigative Demand Authority and Disclosures 3. Proposals to Increase Congressional Oversight of FCA Settlements and Other Issues 4. The Deficit Reduction Act of State and Municipal Legislation 1.05 Present Enforcement Practices Under the False Claims Act A. Parties Charged Under the Act 1.06 The Five Most Common Types of Civil False Claims Act Cases A. The Mischarge Case B. The Fraud-in-the-Inducement, Promissory Fraud, or False Negotiation Case C. The False Certification Case D. The Substandard Product or Service Case E. The Reverse False Claim Case 1.07 Additional Fraud Remedies for the Government A. Statutory Causes of Action 1. Tax Relief and Health Care Act of Truth in Negotiations Act 3. Contract Disputes Act 4. Civil Monetary Penalty Law 5. Program Fraud Civil Remedies Act of Forfeiture Statute 7. Lanham Trademark Act 8. The SEC s Whistleblower Program 9. The CFTC s Whistleblower Program B. Common Law Causes of Action C. Available Damages in Cases of Multiple Fraud Remedies Fried, Frank, Harris, Shriver & Jacobson LLP A Delaware Limited Liability partnership Attorney Advertising. Prior results do not guarantee a similar outcome

2 1.08 Major FCA Amendments Proposed in 2007 and 2008 A. The Senate Bill 1. Claims for Money or Property 2. Elimination of the Public Disclosure/Original Source Jurisdictional Bar 3. Government Employee Relators 4. Calculation of Damages 5. Other Provisions B. The House Bill 1. Claims for Government Money or Property 2. Public Disclosure 3. Government Employee Relators 4. No Requirement to Identify Specific Claims 5. Other Provisions 1.09 FCA Amendments in the Fraud Enforcement and Recovery Act of 2009 ( FERA ) A. FERA s Liability Amendments 1. Elimination of Allison Engine s Intent Requirement 2. Materiality Requirement 3. Expanded Conspiracy Liability 4. Conversion Liability Amendment 5. Reverse False Claims Liability Amendment 6. Retroactive Liability B. Other FCA Amendments in FERA 1. Civil Investigative Demand Amendment 2. Retaliation Amendment 3. Relation-Back Amendment 4. Service on State and Local Authorities 1.10 FCA Amendments in the Affordable Care Act ( ACA ) in 2010 A. Public Disclosure/Original Source Amendments B. Amendment Linking the Antikickback Statute and the FCA C. Amendment Applying FCA to Health Care Overpayments D. Amendments Applying FCA to Health Care Exchanges 1.11 Retaliation Amendments in 2010: Dodd-Frank Wall Street Reform and Consumer Protection Act ( Dodd- Frank Act ) 1.12 Securities Disclosure Issues in FCA Litigation A. General Obligations to Disclose Pending Legal Proceedings B. Obligation to Disclose Pending Investigation or Sealed Qui Tam Complaint C. Obligation to Disclose Partially-Unsealed Qui Tam Complaint D. Disclosure Obligations Upon Settlement Chapter 2: LIABILITY UNDER THE FALSE CLAIMS ACT 2.01 The Elements of a Cause of Action Under the False Claims Act Before and After FERA A. The Most Common Situation: A False Claim Under 31 U.S.C. 3729(a)(1) 1. Direct Submissions 2. Causing the Submission of a False Claim a. Claims Involving Subcontractors 3. Fraud-in-the-Inducement and Promissory Fraud 4. Necessity for Damages B. Section 3729(a)(1)(A) Direct False Claims Liability After FERA C. Section 3729(a)(2) False Record or Statement Made or Used to Get a False Claim Paid or Approved D. Section 3729(a)(1)(B) Liability for a False Record or Statement After FERA 1. Kickback and Exchange Provisions in the Affordable Care Act Fried, Frank, Harris, Shriver & Jacobson LLP 2

3 E. Section 3729(a)(3) Conspiracy 1. The Elements of a Section 3729(a)(3) Conspiracy 2. Intent 3. Expanded Liability 4. Common Defenses to an FCA Conspiracy 5. No FCA Conspiracy to Submit Reverse False Claims 6. Necessity for Damages 7. Limitations Issues F. Section 3729(a)(1)(C) Conspiracy After FERA 1. Elements of Conspiracy 2. Defenses to Conspiracy Liability G. Section 3729(a)(4) Delivery of Less Property H. Section 3729(a)(1)(D) Wrongful Possession of Government Property After FERA I. Section 3729(a)(5) and Section 3729(a)(1)(E) False Receipt J. Section 3729(a)(6) and Section 3729(a)(1)(F) False Purchase K. Section 3729(a)(7) The Reverse False Claim 1. Requirements for Liability 2. The Definition of Obligation to Pay or Transmit Money or Property Under Section 3729(a)(7) L. Section 3729(a)(1)(G) Reverse False Claim Liability After FERA M. Conclusion 2.02 Defining Claim Under the False Claims Act A. Definition of Claim Before the 1986 Amendments Requirement of a Request or Demand B. Definition of Claim After Expansive Characterizations of Claim 2. More Restrictive Interpretations of Claim a. Proof of an Actual Call Upon the Public Fisc Is Required 3. Attempts to Characterize Express and Implied False Certifications as Claims C. Definition of Claim After Statutory Requirements 2. Legislative History D. Inchoate Demands Are Not Claims E. Retention of Money Due Another as a Claim F. A Bid Is Not a Claim G. A False Claim Is Not Limited to a Claim for Money H. Claims Submitted to Recipients of Federal Funds 1. Percentage of Federal Funding 2. Claims to Amtrak 3. The Presentment Requirement 4. The Supreme Court s Decision in Allison Engine a. Liability Under Section 3729(a)(2) b. Liability Under Section 3729(a)(3) c. Materiality in Allison Engine 5. Claims to Intermediaries I. Tax Claims 2.03 When Is a Claim or Statement False or Fraudulent? A. The Interplay Between Falsity and Intent B. Falsity A Matter of Objective Interpretation 1. The Effect of Ambiguity on Falsity Determinations C. Determining Falsity Requires Determination of All Relevant Evidence 1. Literal Truth 2. Contract Interpretation 3. Regulatory Requirements 4. Proof of an FCA Violation Requires Proof of Actual Falsity D. Admissibility of Expert Evidence on Falsity 1. Statistical Analysis Fried, Frank, Harris, Shriver & Jacobson LLP 3

4 E. The Appropriate Evaluator of Falsity F. Government Knowledge Canceling Falsity 1. Cases That Find No Falsity a. Contract Interpretation Cases b. Post Hoc Acquiescence Negating Falsity 2. Cases That Find Falsity 3. Government Knowledge of False Claims Act Allegations G. The Effect of Primary Statutory, Regulatory, or Contractual Violations on Falsity 1. Implied and Express Certifications of Compliance a. Implied Certifications b. Express Certifications 2. The Scope of the False Certification Theory of Liability 3. Limitations on False Certification Liability a. Prerequisite to Payment Requirement b. Express Condition of Payment Requirement c. Knowingly False Certification Requirement 4. Attempts to Broaden Liability Based on False Certification and Fraud-in-the-Inducement Theories 5. Determining Whether Underlying Statutory or Regulatory Violations Have Occurred 6. Reverse False Claims 2.04 Materiality A. Establishing the Materiality Requirement B. Materiality Standards 1. The Prerequisite to Payment Standard 2. The Natural Tendency to Influence Standard 3. Materiality After FERA C. Proving Materiality 1. Materiality as a Question of Fact 2. Materiality as a Question of Law D. Heightened Materiality 1. Reliance 2. Causation 3. Cases Questioning the Application of Materiality, Reliance, or Causation E. A Final Word on Materiality 1. Problems with the Natural Tendency to Influence Test 2. Problems with the Prerequisite to Payment Test 3. The Proper Test for Materiality 2.05 Causation A. The Causation Requirement B. The Causation Standard 2.06 The Intent Necessary for Liability Under the False Claims Act A. Pre-1986: The Conflict in the Circuits B. The 1986 Amendments C. Intent After Denial of Liability Absent Clear Intent to Defraud or Mislead 2. Imposition of Liability Absent Specific Intent to Defraud D. Advice of Expert/Counsel Defense E. Advising the Government and the Effect of Government Knowledge on Intent F. Mistake of Law G. Intent in Allison Engine 2.07 Establishing and Avoiding Liability Based on Res Judicata and Collateral Estoppel A. Application of Collateral Estoppel to FCA Cases 1. In General 2. Nolo Contendere Plea B. Collateral Estoppel Effect of False Statement C. Estoppel by Other Civil or Administrative Proceedings Fried, Frank, Harris, Shriver & Jacobson LLP 4

5 D. Estoppel Against the Government 1. Not Guilty Verdict 2. Findings During Sentencing Proceedings 3. Promises in Plea Negotiation 4. Estoppel Against the Government by Administrative Proceeding 5. Estoppel Against the Government by Act of a Relator E. The Application of Collateral Estoppel and Res Judicata Against a Relator 1. Settlement and Release 2. Identity of Parties and Overlap of Allegations 2.08 Corporate Liability Under the False Claims Act A. General Rule on Corporate Liability for Acts of Employees B. The Collective Knowledge Theory in FCA Cases C. Attempts to Broaden Corporate Vicarious Liability 1. The 1986 Amendments 2. United States v. O Connell 3. ASME Should Not Apply to FCA Cases 4. Imposition of Vicarious Liability for Punitive FCA Damages D. The Due Diligence Defense E. Liability for the Acts of Related Corporate Entities F. Respondeat Superior and the Noncorporate Defendant 2.09 Defendants Subject to Liability Under the False Claims Act A. Allowable Defendants B. Government Employees and Federal Government Entities as Defendants 1. The False Claims Act and Official Immunities C. State Governments and Instrumentalities as FCA Defendants 1. Sovereign Immunity Under the Eleventh Amendment 2. States as Persons Subject to Suit Under Section 3729(a) of the FCA 3. Arms of the State and Other State Instrumentalities D. Municipal and County Entities 1. Pre-Chandler Cases Holding That Local Governmental Entities Are Not Subject to Liability Under Section 3729(a) 2. Cases Holding That Local Governmental Entities Are Subject to Liability Under Section 3729(a) E. Immunity from Whistleblower Claims Under Section 3730(h) 1. State Immunity 2. Local Governmental Entities 2.10 Joint and Several Liability 2.11 Indemnification and Contribution 2.12 Alternative Common Law Causes of Action 2.13 Election of Remedies Chapter 3: DAMAGES AND PENALTIES UNDER THE FALSE CLAIMS ACT 3.01 Measuring Damages in the Most Common Types of False Claims Cases A. The Mischarge Case B. The False Negotiation or Fraud-in-the-Inducement Case 1. Damages in Bid Rigging Cases 2. Damages in Defective Pricing Cases a. The GSA Multiple Award Schedule Case b. The TINA Case 3. Damages in Kickback Cases a. The Medicare/Medicaid Kickback Case b. Entering Into a Contract With No Intention of Performing C. Damages in False Certification Cases 1. The Basic Measure of Damages a. The Actual Loss Test Fried, Frank, Harris, Shriver & Jacobson LLP 5

6 i. Unjust Enrichment Is Not Loss ii. The Effect of Retainages and Other Withholdings on Actual Damages b. The But For Test c. Benefits Wrongfully Paid to Third Parties 2. Reliance 3. Subtraction From Damages of Amounts for Which Government Has Been Reimbursed or Otherwise Compensated D. Damages in Substandard Product/Service Cases 1. The Benefit of the Bargain Rule 2. The Out-of-Pocket Rule 3. The Total Value Cases 4. The Government Use Cases 5. The Failure to Test or Inadequate Testing Cases A Special Rule E. The Reverse False Claim Cases 3.02 The Punitive Nature of FCA Damages and Penalties A. Supreme Court Decisions Analyzing the Pre-Amendment FCA B. Decisions Analyzing Post-Amendment FCA Damages and Penalties 3.03 Additional Elements of Damages A. Recovery of Consequential Damages 1. No Recovery in Substandard Product Cases 2. The False Certification Cases 3. The 1986 Amendments B. Indirect Damage Elements 1. Pre-Judgment Interest 2. Investigative Costs and Other Expenses 3. Credits and Offsets 3.04 The Multiplier and Reduction of Damages for Voluntary Disclosure A. The Multiplier Before and After 1986 B. Reduction of Multiplier in Voluntary Disclosure Cases 1. The Risks of Making a Voluntary Disclosure 2. Unresolved Issues 3. Mandatory Disclosure Provisions 3.05 Penalties Under the FCA A. The Amount of the Penalty Assessed B. Counting the Penalties C. $5,500 vs. $11, Constitutional Issues of FCA Damages and Penalties A. The Double Jeopardy Clause B. The Excessive Fines Clause C. The Due Process Clause D. A Final Word 3.07 Tax, Accounting, and Bankruptcy Issues Relating to Damages and Penalties A. Tax Deductibility B. Cost Recovery Issues C. Dischargeability in Bankruptcy U.S.C. 1141(d) Debts Owed as the Result of an FCA Suit U.S.C. 523(a)(2)(A) Money Obtained by Fraud U.S.C. 523(a)(7) Fines or Penalties Payable to the Government U.S.C. 523(a)(6) Debts for Willful and Intentional Injury 3.08 Evidentiary Hearings Regarding Damages and Penalties Fried, Frank, Harris, Shriver & Jacobson LLP 6

7 Chapter 4: THE QUI TAM PROVISIONS 4.01 The Plaintiffs in a Qui Tam Case A. The United States B. The Qui Tam Plaintiff or Relator 1. Current Employees 2. Former Employees a. Documents Taken from Employer 3. Competitors and Competitors Employees 4. Multiple Qui Tam Plaintiffs 5. State and Local Governments 6. Special Interest Groups 7. Attorneys and Law Firms 8. Government Employees 9. The Professional Qui Tam Relator 10. The Pro Se Qui Tam Relator 11. Compliance Officers 12. Relators in Bankruptcy C. The Real Party in Interest D. Waivers and Agreements Not to Sue 4.02 Limits on Reliance on Public Information in the Qui Tam Complaint: Public Disclosure and Original Source A. Background 1. The 1986 Public Disclosure Bar 2. The 2010 Public Disclosure Bar B. What Is a Public Disclosure? 1. Category 1 Sources of Public Disclosure a. Civil Hearings b. Criminal Hearings i. Qui Tam Actions Not Barred by Disclosures in Criminal Proceedings ii. Qui Tam Allegations Barred by Disclosures in Criminal Proceedings c. Administrative Hearings 2. Category 2 Sources of Public Disclosure a. Hearings b. Audits or Investigations c. Reports i. Administrative Reports ii. Reports by State Agencies 3. Category 3 Sources of Public Disclosure: The News Media 4. Public Disclosure Through the Freedom of Information Act C. Requirements Under the Based Upon and Substantially the Same Standards 1. Actions Partially Based Upon a Public Disclosure 2. The Minority Approach Actions Actually Derived From a Public Disclosure D. The Original Source Exception 1. The Supreme Court s Decision in Rockwell 2. Information Considered in Determining Original Source Status 3. The Knowledge Standard a. Direct Knowledge b. Independent Knowledge c. Information on Which the Allegations Are Based i. Direct and Independent Knowledge of Information Regarding the Allegations in the Qui Tam Complaint ii. Direct and Independent Knowledge of Information Regarding the Allegations in the Public Disclosure iii. The Quantum of Information Required d. Direct and Independent Knowledge as a Bar to Certain Relators Fried, Frank, Harris, Shriver & Jacobson LLP 7

8 e. The Relator s Role in the Public Disclosure 4. The Disclosure Requirement a. Disclosure to the Entity Making the Public Disclosure b. Disclosure to the Government Prior to Public Disclosure 5. Voluntarily Provided 6. Prior to Filing an Action E. The Interrelationship Between Section 3730(e)(4) and Section 3730(d)(1) 4.03 Impermissible Defendants and Claims A. The Limitations on Qui Tam Suits Against Members of Congress, Judges, and Senior Executive Branch Officials 1. Members of Congress 2. Members of the Judiciary 3. Senior Executive Branch Officials B. States and State Entities C. Bar on Allegations Raised in Pending Civil False Claims Act Lawsuits 1. Pending Government Action Bar 2. First-to-File Bar a. Related Action i. Defining Related Actions as Those That Allege the Same Essential or Material Elements of Fraud ii. Two-Pronged Tests for Identifying Related Actions iii. Similar Circumstances, Separate and Distinct Recovery iv. Unrelated Parties b. Pending Action D. The Qui Tam Case in the Voluntary Disclosure Setting E. Mandatory Disclosure Provisions 4.04 Special Filing Procedures in Initiating a Qui Tam Case A. The Written Disclosure of Material Evidence and Information 1. Discovery of Written Disclosure 2. Discovery of Other Information Relating to the Government s Intervention Decision or Investigation B. Sealing of the Complaint 1. Relator s Possible Right to Publicize the Complaint or Its Substance 2. Length of Time Complaint Is Sealed a. Ex Parte Communications C. The Relator s Right to Amend a Complaint 4.05 The Department of Justice s Role A. The Government Options at the Conclusion of the Sealing Period B. The Government s Right to Take Over the Case C. The Government s Right to Limit the Relator s Role D. The Government s Participation in Declined Cases E. The Relator s Access to CID Material 4.06 Dismissing the Complaint A. Standard of Review for Dismissal of a Qui Tam Case by the Government Under Section 3730(c)(2)(A) 1. The Sequoia Test B. Constitutional Implications C. Motions to Dismiss by a Defendant D. Voluntary Dismissal by a Relator When the Government Has Declined Intervention E. Dismissal Ordered by the Court 4.07 Settling the Qui Tam Case A. Settling Over the Relator s Objection 1. Review Procedure 2. The Fair, Adequate and Reasonable Standard of Review B. Settlement of Cases Where the Government Does Not Intervene 1. Decisions Denying the Government Veto Rights Over a Proposed Settlement Fried, Frank, Harris, Shriver & Jacobson LLP 8

9 2. Decisions Allowing the Government to Block Settlement 4.08 The Relator s Share of the Proceeds A. The Standard Case: Award Between 15 and 25 Percent B. Award When the Qui Tam Relator Litigates Alone C. Award When the Qui Tam Relator Planned and Initiated the Wrongdoing D. The Relator s Award in a Case Based on Public Information in Which the Government Intervenes E. What Qualifies as Proceeds of the Action F. Relator s Award Through an Alternate Remedy G. Federal Income Tax Treatment of Relator s Share Awards, Section 3730(h) Recoveries, and Contingency Fee Arrangements 1. Relator s Share Awards and Section 3730(h) Recoveries 2. Contingency Fee Arrangements with Relator s Counsel H. Survivability of a Qui Tam Action 4.09 Recovery of Attorneys Fees and Costs A. Qui Tam Relator s Recovery 1. Recovering Fees and Costs From Defendants a. Lodestar Calculations b. Grounds for Challenging Fees and Costs c. Joint and Several Liability for Fees and Costs d. Proportionality of Fee Award to Relator s Recovery e. The Effect of Contingency Fee Agreements f. Costs and Issues Associated With Litigating the Fee Award 2. Recovering Fees and Costs From the Government B. Successful Defendant s Right to Recover Fees and Costs 1. Recovering Fees and Costs From the Government 2. Recovering Fees and Costs From the Qui Tam Relator 3. Recovering Fees and Costs From Relator s Counsel 4.10 Claims Against the Relator A. Counterclaims Before the 1986 Amendments B. Counterclaims After the 1986 Amendments 4.11 Retaliation Claims Under the False Claims Act A. The Statute of Limitations Applicable to a Claim Brought Under 31 U.S.C. Section 3730(h) 1. Differing Interpretations 2. The Decisions in United States ex rel. Wilson v.graham County Soil & Water Conservation District a. Prior Case History b. The Supreme Court s Decision 3. The FCA s Three-Year Statute of Limitations B. The Elements of a Cause of Action Under Section 3730(h) 1. Protected Conduct 2. Discriminatory Action by an Employer a. Discriminatory Action b. By an Employer 3. Motivated by Protected Conduct C. Is an Employee Preempted From Bringing Pendent State Claims by Section 3730(h)? D. The Scope of Damages and Remedies Available Under Section 3730(h) 1. Relief Necessary to Make the Employee Whole 2. Punitive Damages 3. Damages for Emotional Distress 4.12 Constitutionality of the Relator s Role A. The Separation of Powers Doctrine 1. The Defendants Arguments 2. The Courts Analyses B. The Appointments Clause 1. The Defendants Arguments 2. The Courts Analyses Fried, Frank, Harris, Shriver & Jacobson LLP 9

10 C. The Standing Doctrine Constitutionally Required Injury in Fact 1. The Defendants Arguments 2. The Courts Analyses D. Due Process 1. The Defendants Arguments 2. The Courts Analyses Chapter 5: PRACTICE AND PROCEDURE UNDER THE FALSE CLAIMS ACT 5.01 Retroactivity of Amendments to the False Claims Act A. Retroactivity of the 1986 Amendments 1. Retroactivity of 31 U.S.C. 3730(e)(4)(A) Jurisdictional Bar 2. Retroactivity of 31 U.S.C. 3731(b)(2) Statute of Limitations 3. Retroactivity of 31 U.S.C. 3729(b) Knowledge Standard B. Retroactivity of the 2009 Amendments 1. Retroactivity of New Section 3729(a)(1)(B) 2. Retroactivity of Procedural Amendments 5.02 Statute of Limitations A. Prior to 1986 Amendments B. The Statute of Limitations After the 1986 Amendments 1. Determining the Date When the Violation Is Committed Under 31 U.S.C. 3731(b)(1) 2. Determining the Date of Government Knowledge Under 31 U.S.C. 3731(b)(2) a. Knowledge of the Necessary Facts b. The Government Officials Who Must Have Knowledge c. Applicability of the Three-Year Tolling Provision in a Qui Tam Suit 3. The Ten-Year Rule 4. Determining the Date When a False Claims Act Suit Commences C. Tolling Agreements 5.03 Stay of False Claims Act Proceedings A. Stay Pending Completion of Criminal Proceedings 1. General Principles 2. Unique Issues Raised by Qui Tam Suits B. Stay Pending Compliance With Rule 9(b) and Resolution of Other Dispositive Motions C. Automatic Stay in Bankruptcy 1. Qui Tam Actions as Actions by a Governmental Unit 2. Potential Effects of a Bankruptcy Filing on a Debtor s FCA Co-Defendants 5.04 The Application of Rule 9(b) to False Claims Act Complaints A. Reduced Intent and Relator Status Irrelevant 1. Rule 9(b) Applies Even Under the Reduced FCA Intent Standard 2. Rule 9(b) Applies to FCA Suits Filed by Qui Tam Relators B. The Level of Specificity Required Under Rule 9(b) 1. The Effect of the Scope and Complexity of an Alleged Fraud on a Rule 9(b) Analysis 2. Illustrative Pleadings 3. Differentiating Among Defendants 4. Rule 9(b) and Conspiracy Allegations 5. The Applicability of Rule 9(b) to Allegations of Materiality, Knowledge of Materiality, and Intent C. A Complaint Must Comply With Rule 9(b) When It Is Filed D. Information Exclusively in Defendant s Control 5.05 Extraordinary Interim Remedies A. Preliminary Injunction to Preserve Assets of the Defendant 1. The Mail Fraud Injunctive Relief Act B. Declaratory Judgment 1. Forcing the Government to Choose Between Limiting the Fraud and Continuing Performance of the Contract 2. To Avoid Government Prosecution Fried, Frank, Harris, Shriver & Jacobson LLP 10

11 C. Pre-Judgment Remedies Under the Federal Debt Collection Procedure Act D. Compelling Administrative Determinations 5.06 Pretrial Issues A. Venue and Change of Venue 1. District Court Venue 2. Change of Venue 3. Venue in the Court of Federal Claims B. Jurisdiction 1. State Court Jurisdiction 2. Board of Contract Appeals Advisory Authority 3. Primary Jurisdiction Over Regulatory Violations Underlying False Claims Act Claim 4. Supplemental Jurisdiction Over State Law Counterclaims C. Joinder D. Multidistrict FCA Litigation E. Nationwide Service of Process F. Subpoena Ad Testificandum G. Alternative Dispute Resolution Procedures 1. Efforts to Compel Arbitration of FCA Claims 5.07 Discovery Issues and Alternatives A. The Civil Investigative Demand 1. The Scope of Discovery Under the CID 2. The CID in the Qui Tam Suit B. Inspector General Subpoenas C. HIPAA Subpoenas D. Use of Grand Jury Information in FCA Cases 1. Limits on Disclosure of Matters Occurring Before the Grand Jury 2. CID Authority and the John Doe Decision 3. In Re Grand Jury Subpoena; Under Seal; Under Seal 2 E. The Freedom of Information Act F. The Application of Touhy Regulations in FCA Litigation G. Government Interrogations and the McDade Amendment H. The Assertion of Privilege and Use of Protective Orders in FCA Cases 1. Self-Critical Analysis 2. Privileges Unique to the Government and Its Agents 3. Confidential Medical Records I. Spoliation of Evidence Issues 5.08 Trial Issues A. Burden of Proof 1. Government Burden 2. Relator s Burden of Proof B. Right to Jury Trial in False Claims Act Cases C. Records/Proving Liability and Damages D. Admissibility of Guilty Pleas E. Party Admissions F. Dispositive Motions G. Motions in Limine H. Jury Instructions 5.09 Appeals 5.10 Insurance Coverage 5.11 General Settlement Issues A. Global Settlements B. Authority to Settle C. Collateral Consequences Fried, Frank, Harris, Shriver & Jacobson LLP 11

12 Chapter 6: STATE AND MUNICIPAL CIVIL FALSE CLAIMS ACTS 6.01 State Qui Tam Statutes A. The California False Claims Act 1. Liability and Damages 2. Qui Tam Provisions 3. Jurisdictional Bars 4. Whistleblower Retaliation 5. Practice and Procedure a. Statute of Limitations b. California Litigation Privilege c. Counterclaims and SLAPP Suits B. The Florida False Claims Act C. The Illinois False Claims Act D. The District of Columbia Procurement Reform Amendment Act E. The Nevada False Claims Act F. The Hawaii False Claims Acts 1. False Claims Against the State 2. False Claims Against Counties G. The Delaware False Claims and Reporting Act H. The Massachusetts False Claims Act I. The Tennessee False Claims Act J. The Virginia Fraud Against Taxpayers Act K. The Montana False Claims Act L. The Indiana False Claims and Whistleblower Protection Act M. The New York False Claims Act N. The New Mexico Fraud Against Taxpayers Act O. The Rhode Island State False Claims Act P. The Oklahoma Medicaid False Claims Act Q. The New Jersey False Claims Act R. The Minnesota False Claims Act S. The North Carolina False Claims Act T. The Iowa False Claims Act 6.02 State Health Care Fraud Statutes A. The Tennessee Medicaid False Claims Act B. The Louisiana Medical Assistance Programs Integrity Law C. The Texas Medicaid Fraud Prevention Law D. The New Mexico Medicaid False Claims Act E. The New Hampshire Health Care False Claims Act F. The Michigan Medicaid False Claim Act G. The Georgia State False Medicaid Claims Act H. The Wisconsin False Claims For Medical Assistance Act I. The Connecticut False Claims Act J. The Maryland False Health Claims Act of 2010 K. The Colorado Medical Assistance Act 6.03 Other State False Claims Acts 6.04 Novel State and Federal False Claims Act Issues A. Statutory Interpretation B. Choosing Between State and Federal Court C. Constitutionality Challenges D. Mixed Federal-State Funding Cases 6.05 Municipal Qui Tam Laws A. The San Francisco Ordinance B. The New York City Ordinance C. The Chicago Ordinance 6.06 Recent State False Claims Laws Without Qui Tam Enforcement Fried, Frank, Harris, Shriver & Jacobson LLP 12

13 A. The Kansas False Claims Act B. The Oregon False Claims Act APPENDICES Appendix A.1 The Federal False Claims Act (Current) Appendix A.2 The False Claims Act (2000) Appendix A.3 The Federal False Claims Act (Redline 2010) Appendix A.4 The Fraud Enforcement and Recovery Act of 2009 ( FERA ) Appendix A.5A The Patient Protection and Affordable Care Act ( ACA ) (Public Disclosure/Original Source Amendments) Appendix A.5B ACA (Medicare/Medicaid Overpayments) Appendix A.5C ACA (Antikickback Statute Amendments) Appendix A.5D ACA (Health Insurance Exchanges) Appendix A.6 The Dodd-Frank Wall Street Reform and Consumer Protection Act (Retaliation Amendments) Appendix B The False Claims Act (Original) Appendix C The False Claims Act (Amended 1943) Appendix D.1 The False Claims Act, 1986 Amendments Senate Report Appendix D.2 The False Claims Act, 1986 Amendments House Report Appendix E The False Claims Act, 2009 FERA Amendments Senate Report Appendix F Sample Complaints, Affirmative Defenses, and Jury Instructions Appendix G Sample Settlement Agreement United States v. [ Teaching Hospital ] Appendix H False Claims Act Statistics Appendix I.1 The California False Claims Act Appendix I.2 A Section-by-Section Analysis of the California False Claims Act Appendix I.3 Comparison Between the California and Federal False Claims Acts Appendix I.4 The Florida False Claims Act Appendix I.5 The Florida False Claims Act: Bill Analysis Appendix I.6 The Illinois False Claims Act Appendix I.7 The Illinois Whistleblower Reward the Protection Act: Analysis Appendix I.8 The District of Columbia False Claims Law Appendix I.9 The Nevada False Claims Act Appendix I.10 The Hawaii False Claims Acts Appendix I.11 The Delaware False Claims and Reporting Act Appendix I.12 The Massachusetts False Claims Law Appendix I.13 The Tennessee False Claims Act Appendix I.14 The Virginia Fraud Against Taxpayers Act Appendix I.15 The Montana False Claims Act Appendix I.16 The Indiana False Claims and Whistleblower Protection Act Appendix I.17 The New York State False Claims Act Appendix I.18 The New Mexico Fraud Against Taxpayers Act Appendix I.19 The Rhode Island State False Claims Act Appendix I.20 The Oklahoma Medicaid False Claims Act Appendix I.21 The New Jersey False Claims Act Appendix I.22 The Minnesota False Claims Act Appendix I.23 The North Carolina False Claims Act Appendix I.24 The Iowa False Claims Act Appendix J.1 The Tennessee Medicaid False Claims Act Appendix J.2 The Louisiana Medical Assistance Programs Integrity Law Appendix J.3 The Texas Medicaid Fraud Prevention Law Appendix J.4 The New Mexico Medicaid False Claims Act Appendix J.5 The New Hampshire Health Care False Claims Law Appendix J.6 The Michigan Medicaid False Claim Act Appendix J.7 The Georgia State False Medicaid Claims Act Appendix J.8 The Wisconsin False Claims for Medical Assistance Act Appendix J.9 The Connecticut False Claims Act Appendix J.10 The Maryland False Health Claims Act Appendix J.11 The Colorado Medicaid False Claims Act Fried, Frank, Harris, Shriver & Jacobson LLP 13

14 Appendix K.1 Appendix K.2 Appendix K.3 Appendix L.1 Appendix L.2 The San Francisco Act The New York City False Claims Act The Chicago False Claims Act The Kansas False Claims Act The Oregon False Claims Act Fried, Frank, Harris, Shriver & Jacobson LLP 14