What is a Whistle Blower or Qui Tam Law Suit?
A Whistle Blower or Qui Tam Law Suit is a civil suit that is filed by an individual who has knowledge of a company’s fraud, illegal activities or corruption which results in some sort of financial loss to the Government. Typically Whistle Blowers are employees or former employees of a company that has some sort of relationship with the Federal Government. We often see Whistle Blower law suits crop up in the context of the Health Care industry, where hospitals may be improperly charging Medicaid or Medicare, defense contractors or other suppliers of products or services to the Government, or any industry that is regulated by the Federal Government such as Banking, Finance and Securities.
In a Whistle Blower law suit the individual with information related to the wrong doing may file a law suit under the Federal False Claims Act, wherein the individual stands in the shoes of the Government, while the Government is given the opportunity to review the claim and determine if they wish to intervene. The term “Qui Tam” is short for the Latin phrase “qui tam pro domino rege quam pro sic ipso in hoc parte sequitur” which means “He who sues for himself as well as the King in this matter”. It refers to the ability of an individual, who is aware of a fraud upon the Government, having the ability to stand in the shoes of the King or Government and sue on their behalf.
In the U.S. our Federal False Claims Act was signed into law by President Lincoln after unscrupulous companies would sell the Government inferior weapons, uniforms and supplies during the civil war. Congress passed a law that would not only protect the individuals who outed this fraud but also financially reward them for the risk they took.
Under the Federal False Claims Act an individual, who provides valuable and unique information to the Government which they use to recover damages, is entitled to a portion of the money recovered. It takes a great deal of courage and integrity to stand up to your employer when you know they are engaging in improper conduct. A Whistle Blower may suffer retaliation within his company or even within an entire industry. The Federal False Claims Act recognizes the risk these Whistle Blowers take and the value of the information they provide by providing a financial incentive in cases where they are able to recoup a portion of their damages.
Recent examples of Whistle Blower law suits include:
- Health Care Fraud
- Over 2 billion recovered recently against drug and medical device manufacturers;
- 1.5 billion paid by GlaxoSmithKline LLC related to allegations that they promoted certain anti-depressants, including Paxil, Wellbutrin and Zofran, for uses not approved by the FDA and provided paid kick backs to physicians to prescribe the drugs for these off label uses;
- Mortgage and Housing Fraud
- 1 billion paid by Countrywide Financial related to allegations that they engaged in deceptive and fraudulent mortgage underwriting practices;
- 7 billion dollar settlement reached with Citigroup related to how it marketed and sold residential mortgage backed securities;
- Procurement Fraud & Price Fixing
- 200 million dollar settlement with Oracle Corp. regarding allegations they misrepresented to the Federal Government their general commercial discounts given to private customers in order to extract a higher price from the Government.
- More recently, in July of 2014, the Department of Justice announced that it would intervene in a similar case against Symantec Corp. which has been supplying software to the Federal Government. See WSJ article: http://goo.gl/K15xJ3
If you have knowledge of fraud or corruption that results in a loss to the Government call us to see if we can help. These are always complicated and difficult cases that involve highly sensitive and emotionally charged issues. You need a law firm with the experience and resources to protect your rights through this process.
Call the attorneys at 314-621-1252!