Where can I file a False Claims Act case?

Two questions we are frequently asked by prospective whistleblowers are: (1) can I file a False Claims Act case in a state where I don’t reside, and (2) will you be able to represent me if we don’t file in Georgia? 

The answers to both are yes! We might be best-known as Atlanta whistleblower attorneys, but we represent clients nationwide. 

Relators Can File a False Claims Act Case Almost Anywhere

The False Claims Act gives relators flexibility to file in just about any district with ties to the defendants or the fraud. Under 31 U.S.C. § 3730:

“Any [False Claims Act action] may be brought in any judicial district in which the defendant or, in the case of multiple defendants, any one defendant can be found, resides, transacts business, or in which any act proscribed by [the False Claims Act] occurred.”

What does that mean? If your defendant is a hospital in Savannah, you can file your case in the Southern District of Georgia because the defendant transacts business there. If your case also has a doctor defendant who commutes from Macon, you could instead file your case in the Middle District of Georgia because one of your defendants resides there.

Getting more creative, the False Claims Act also states that jurisdiction can be found in any district in which any proscribed act occurred. The sine qua non of a False Claims Act violation (meaning the essential element) is the submission of a false claim. 

So, a savvy relator’s counsel may file their qui tam case in the district where the claim is submitted to rather than from. For example, many False Claims Act cases are filed in the District Court for Washington, D.C. because the affected agency is located there. 

Taking it one step further, defense contractor cases are often brought in the Southern District of Ohio, because the Defense Finance and Accounting Service (DFAS), the agency that processes the payments on behalf of the Department of Defense, is located in Columbus.

When our Savannah hospital submits claims to Medicare, the claims are first processed by the Medicare Administrative Contractor located in the District of South Carolina. The reimbursements are issued by the Centers for Medicare & Medicaid Services (CMS), which are headquartered in the District of Maryland. And claims submitted to Georgia Medicaid might be paid out of Atlanta, in the Northern District of Georgia. So, even a fairly localized fraud can be brought in many different jurisdictions.

Thus, when a defendant is a massive corporation doing business throughout the country, you have your choice of where to file an FCA case. For example, say your defendant is a pharmaceutical manufacturer selling its product to pharmacies or hospitals throughout the country. Even if the Relator is a pharmacist in Orlando, they can file their case in any district in the country, so long as the defendant is transacting business in that district.

Fraud Against the Government is a Federal Matter

Normally, a defendant must have some ties to a district for the court to have jurisdiction. This is called “personal jurisdiction.” However, another unusual twist is that you can file a False Claims Act case wherever a single defendant is located. That establishes personal jurisdiction over every other defendant who partook in the scheme. This applies even in a multiple-defendant case where no other defendant has any business in that district.

For example, if a major pharmaceutical manufacturer pays kickbacks to physicians throughout the country, they can all be brought into a single jurisdiction. A defendant physician in Orlando who has never lived or practiced outside the state could be named in a California lawsuit.

That’s because the False Claims Act recognizes that fraud against the government is a crime being committed against the entire country. All one needs to meet this requirement is minimum contact with the United States as a whole and at least one defendant with specific ties to the district.

Where to File Your FCA Case

With so many options, there are also many considerations as to where you will ultimately want to file your False Claims Act case. 

On the one hand, if most of the fraud occurred in a particular district, it may make sense to file your case in that district. U.S. Attorney’s Offices have limited resources. The Southern District of Florida, for example, is more likely to expend the time and money to investigate a Miami medical practice than is the Central District of California. This will also save you the time and money of flying out to California for meetings with the investigators and possibly having to attend an out-of-town trial.

If a case is large in scope or complexity, local may not be best, especially if you are in a district with fewer resources. Although the Southern District of New York may have a lot of cases, it also has a lot of manpower and money, whereas some civil divisions in other venues are staffed with just one or two attorneys.

Another factor may be whether that office has worked similar cases in the past, possibly even against the same defendant. This means they have experience in that area, they know the pitfalls, they know what evidence they need to acquire, and they can probably even act more efficiently by cribbing from their past cases. Certain offices tout their experience in specialized areas such as customs fraud and electronic health records cases.

U.S. Attorney reputational issues come into play as well. Some offices have reputations for being more willing to intervene and litigate cases, not just settle them. Some offices have a higher requirement for settlement. Some offices are known to pay larger relator’s shares than other offices. You want the best government fraud attorney to represent you, and you want the best government attorneys to work your case.

Most importantly, different courts will apply the law differently to your case. Each federal district court is in one of eleven circuits, each of which has an appellate bench that interprets how the law should be applied. This can lead to major splits in how courts treat different issues that can only be resolved by the Supreme Court. These are important considerations for your lawyers, as numerous pitfalls await your case if you file in the wrong court.

Lastly, once the case is unsealed, your defendant may attempt to move the case to a more convenient venue. The medical provider in Austin, Texas does not want to have to litigate a case in Maryland. Lots of considerations go into whether the court will consider moving a case, and they vary by Circuit.