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Top 10 Tips For Qui Tam Whistleblowers

I’ve represented dozens of whistleblowers in different types of cases all around the country. Almost every week, I talk to someone who is thinking about blowing the whistle on some sort of fraud or unlawful conduct by his or her current or former employer, and I try to guide those people through the difficult process of deciding whether to go forward with a qui tam case.  (For those of you who don’t already know, a “qui tam” case is a type of legal proceeding in which a whistleblower discloses unlawful conduct to the government, and in exchange becomes eligible for a monetary reward based upon the size of the government’s eventual recovery.)  Based on that experience, I offer these key things that every potential qui tam whistleblower should know.

1. Qui Tam Whistleblowers Are Heroes.

First and foremost, know that you are doing the right thing. It takes independence and moral courage to be the one person in a company to ask, “Is what we are doing right?”  But often, it is that one person—the whistleblower—that saves his or her fellow American taxpayers millions of dollars, and ultimately makes the company a more ethical place to work.  And the government appreciates what you do.  According to official U.S. Department of Justice statistics, since 1987 the federal government has recovered $39 billion in cases brought under the primary qui tam statute the False Claims Act.  In addition, the federal government has paid more than $4.2 billion in awards to whistleblowers under that statute, including approximately $3.6 billion since 2001.

2. You Need To Move Quickly.

If you are considering bringing a qui tam case, you should move quickly or you may lose your opportunity to receive an award. Most qui tam whistleblower laws, including the False Claims Act, have a “first-to-file” rule.  This means that only the first whistleblower to file a case disclosing a particular fraudulent scheme to the government is eligible to receive an award.  Moving quickly does not mean rushing.  You still need to carefully choose an attorney, work with that attorney to organize your evidence to make a convincing case, and think through all of the possible ramifications of your filing.  But start that process soon to maximize your chances of prevailing in the end.

3. But Then You Need To Be Patient.

While moving quickly to file your case is important, once the case is filed, you then have to shift your mindset to one of patience. Qui tam cases do not move quickly.  In almost all cases, after you file, the government will conduct an investigation of your allegations.  Those investigations can take months or years.  And even after the investigation is over, you still may be faced with legal proceedings that move deliberately and carefully through the court system.  It can be a long slog.  So, pack some snacks – it’s going to be a long ride.

4. The Lawyer You Hire Really Does Matter.

Because it’s a long and complicated ride, the person you choose to ride with (your lawyer!) can make a big difference to how difficult that ride seems, and whether it is ultimately successful. Only a very small number of lawyers across the entire country have any substantial experience representing qui tam whistleblowers, and it is a highly technical, complex area of law.  In addition, litigating qui tam cases through to the end requires both manpower (typically, a team of lawyers and paralegals) and financial resources (to pay for investigators, expert witnesses, document review systems, and other costly items that can make or break a big case).  Make sure the lawyer you choose has excellent credentials, relevant experience, and the resources necessary to see your case through to the end.  But also make sure that the lawyer is responsive, trustworthy and understanding of the human side of whistleblower cases.  You will spend a lot of time interacting with your lawyer, so those interactions should be as pleasant as possible, rather than something you come to dread.

5. Evidence Is The Key.

Most people, including judges and government prosecutors, assume that the vast majority of businesses are law abiding. Those of us who represent whistleblowers know that, unfortunately, this is not always the case.  So, the first time you talk to me or another lawyer that works in this area of the law, we will listen sympathetically to your story.  But we will then always ask the same question: “What evidence do you have that corroborates what you are telling me?”  It’s not that we don’t believe you.  It’s just that we know what it will take to convince a skeptical judge or government prosecutor that your story of a massive corporate conspiracy is actually true.  That usually means documents—emails, reports, notes, medical records, contracts, data, etc.  A whistleblower without corroborating evidence is unlikely to succeed.

6. Read About It In The Newspaper?  You’re Probably Not a Whistleblower.

The underlying justification for the False Claims Act and other qui tam statutes is to incentivize people to inform the government of fraud about which the government does not otherwise know. So, these statutes typically have some version of what is known as the “public disclosure bar.”  This is a very technical area of the law, but in general it means that a qui tam lawsuit cannot be based on information that has already been made public in the news media, in prior lawsuits, or in government reports (unless you were the original source of those public disclosures).  If you read about it in the newspaper before you reported it, you probably cannot bring a successful qui tam lawsuit.

7. You Are Protected (Mostly).

A significant concern of many potential qui tam whistleblowers is the effect that blowing the whistle will have on their careers. The False Claims Act does offer protection.  It includes an anti-retaliation provision that makes it unlawful for an employer to retaliate against you for exercising your rights as a whistleblower under the statute.  In addition, at least during the period of the government’s investigation, your identity is protected by the “seal” provision of the law, which prohibits the government from disclosing your identity without court approval.  But blowing the whistle, even under the False Claims Act, has risks.  Whistleblowers do sometimes suffer retaliation, and the fact that you could sue your now ex-employer for firing you may be cold comfort if you have lost a good job or suffered injury to your reputation.  This is one of the reasons that successful qui tam whistleblowers are given such large awards:  to compensate them for taking that career risk.

8. Silence Is Golden.

One of the first things I always tell my whistleblower clients is that they need to keep quiet about the fact that they are considering bringing a qui tam lawsuit. Don’t tell your friends.  Don’t tell your family.  And certainly don’t tell your co-workers.  This is for two primary reasons.  First, because of the first-to-file bar, you don’t want to inadvertently give someone else the idea to file a case before you.  Second, the “seal” provision of the False Claims Act, and other similar statutes, prohibits you from disclosing the existence of the lawsuit during the period of the government’s investigation and without court approval.  If you violate the “seal,” you can forfeit your right to receive an award at the end of the case.  Your lawyer is your confidant; talk to him or her about the case as much as you need to.  But otherwise, remain silent.

9. There Is Power In Numbers.

Whistleblowers do not have to act alone. Qui tam cases can, and often are, brought by multiple whistleblowers working together.  In large companies, each employee may only have access to certain information, or know about one aspect of the fraudulent scheme.  By joining forces with others, you can connect the dots, and paint a fuller picture of what is really happening.  Plus, your story is automatically more credible to the government if you have others willing to back you up.  Although the members of the group that brings the qui tam case will have to share in the ultimate reward, the pie that you divide may well be much bigger because you worked as a team.

10. More Is Covered By the Qui Tam Laws Than You Thought.

The False Claims Act, which makes it unlawful for companies to commit fraud on the federal government, has been around, in some form, since the Civil War. That’s why it is called Lincoln’s Law.  But in recent years, we’ve seen a whistleblower revolution.  The False Claims Act has been amended to make it more powerful.  Many states have enacted similar laws to encourage whistleblowers to disclose fraud on state or local governments.  And new laws offer substantial awards to whistleblowers who report tax fraud, violations of securities laws, and fraud in the banking industry.   Congress and state legislatures have universally come to recognize that whistleblowers serve a crucial role, and need to be both incentivized and protected.  If you are aware of a corporate scheme to commit financial fraud of any sort, it probably is covered by one of the qui tam laws, and it may be worth at least consulting with an attorney about the issue.

If you are considering blowing the whistle on corporate fraud, you should consider these Top 10 tips.

© 2019 by Tycko & Zavareei LLP

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About this Author

Jonathan K. Tycko, Civil Litigation Attorney, Tycko Zavareei Law firm
Partner

Mr. Tycko has represented clients in numerous qui tam whistleblowing cases, in areas including Medicare fraud, government contracts fraud, and tax fraud. In addition, with the 2010 passage of the Dodd-Frank Act, Mr. Tycko’s practice has expanded into representation of whistleblowers in the areas of securities and commodities, and violations of the Foreign Corrupt Practices Act.

Mr. Tycko focuses his practice on civil litigation, with special concentrations in whistleblower cases, consumer class actions, unfair competition litigation, employment litigation and housing litigation. He...

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