A particularly cloudy area in whistleblower litigation is what, and how much, can an employee take from an employer to support their case, particularly when they don't even know what their case is yet. The short answer is that public policy encourages and allows whistleblowers to take whatever they need, if they objectively suspect that their employer is violating the False Claims Act. This public policy argument has been recognized by various courts as trumping HIPAA (which actually has a statutory whistleblower exception), non-disclosure agreements, confidentiality agreements, and employee duties of loyalty. Unfortunately, it is not so clear cut as that, which is why it is vital to contact a qui tam attorney before taking anything. (Which makes this a good time to remind readers that this post does not constitute legal advice.)
One of the main limitations to this public policy exception is taking only those documents within an employee's control. If you someone sends you something in an email, it is probably fair game. If you have access to billing or files as part of your normal course of employment, you're likely safe to make copies of those documents. If you have to sneak into someone's office to look at records that are not customarily a part of your job requirements, now you're probably going too far. And if you have to crack open a locked filing cabinet to get to the dirt, well now you have not only jeopardized your qui tam case, but you may be facing charges.
Another potential limitation is the substance of what you are taking. If you think that your business is engaging in a fraudulent scheme, and you know where the documents are to prove it, that's a good start. If you have no idea what documents you need, so you copy anything and everything, now you've entered a very gray area.
That was an issue raised in separate cases in the Northern District of Illinois, which emphasize that this is a case-by-case analysis with no brightline rule. In U.S. ex rel Wildhirt v. AARS Forever, Inc., a 2013 decision, the court allowed a breach of contract claim where the relators' "retentions and disclosures went beyond the scope of those necessary to pursue their qui tam suit." This seemed very broad and worrisome, particularly to those potential whistleblowers who had no idea what they needed to prove their case.
A new opinion clears things up a little. In U.S. ex rel. Cieszyski v. LifeWatch Services, the court held that a potential whistleblower is entitled to conduct a complete investigation to support their case, so long as that is their purpose.
It is unrealistic to impose on a relator the burden of knowing precisely how much information to provide the government when reporting a claim of fraud, with the penalty for providing what in hindsight the defendant views as more than was needed to be exposure to a claim for damages. Given the strong public policy encouraging persons to report claims of fraud on the government, more is required before subjecting relators to damages claims that could chill their willingness to report suspected fraud. And here, LifeWatch fails to allege there is more, as there was in Wildhirt and other cases invoked by LifeWatch. Relator did not disclose the information to anyone other than the government and his attorney, did not disclose attorney-client information, and did not disclose trade secret information to Life Watch's competitors. We hold that on these allegations, relator did not go so far that he has exposed himself to defendant's breach of contract action. To allow a counterclaim based on the barest allegation that a relator took more documents than absolutely necessary would gut the strength and purpose of the public policy exception, which protects relators from retaliation by their employers for actions taken by relators "while they are collecting information about a possible fraud, before they have put all of the pieces of the puzzle together."
This ruling provides some guidance to potential whistleblowers. First, limit your taking to what you need, or if you don't know, to what you think you need. The relators in Wildhirt admitted to having taken confidential documents haphazardly, and with no intent to file a qui tam action when they did so, only discovering the FCA violations later. This does not necessarily mean, however, that if you intend to file a False Claims Act case that you may expand your search to a "who knows what else they're doing?" investigation. A court is likely to frown upon you taking the secret recipe to Coca-Cola to prove an overbilling claim. Second, share this information only with your lawyers. We will decide what is appropriate or not appropriate to share with the government, and can segregate material that could otherwise get you in trouble.
Of course, the court's guidance is not only somewhat vague, but it is limited to the Northern District of Illinois. If at all possible, contact an FCA lawyer before you even begin your investigation. You likely have some emails and other documents in your possession that suggest wrongdoing, and your natural instinct is to gather more evidence before you go to an attorney. Maybe you don't want to waste the attorney's time without knowing for sure, or you want a rock solid case so that the attorney is more likely to believe you. I pray of you, ignore that instinct.
It is in your best interest to come to us as early as possible, before you investigate any further. We can help protect your personal interests (including keeping your job or building a retaliation claim) and gather the best documentation to support your False Claims Act allegations. We offer free consultations expressly for this purpose.