December 28, 2015
December 28, 2015 – Filing a complaint expeditiously for a whistleblower and her lawyer is a top priority for experienced qui tam attorneys. As we previously discussed in the article titled, Reporting Fraud by Filing a Qui Tam Case, timeliness is of the essence to meet the first to file rule. And if the whistleblower’s case has jurisdictional defects, it has to be dismissed and completely filed anew in the proper court. This process puts the whistleblower at risk of losing claims to her case. However, recent events have coalesced to dissolve the jurisdictional hurdle to a relator’s action.
Precedent Setting Opinion Clears the Way to Cure Jurisdictional Defects
The Dec. 16, 2015 opinion by Judge Bruce Selya of the Court of Appeals for the First Circuit of Rhode Island opens the door for a relator to amend and supplement her existing complaint. Judge Selya relied on several earlier rulings, including Federal Rule of Civil Procedure 15(d), the opinion in ConnectU vs. Zuckerberg, and the Supreme Court’s May 26, 2015 ruling in Kellogg Brown & Root Services, Inc. v. United States ex rel. Carter.
Under Fed. R. Civ. Pr. 15(d), Judge Selya opined that a relator can supplement her complaint to remedy jurisdictional defects, instead of being required to file an entirely new case. The judge explained that “the Rule helps courts and litigants avoid pointless formality.” Additionally, “supplementation of pleadings is encouraged ‘when doing so will promote the economic and speedy disposition of the entire controversy between the parties.'”
Judge Selya, also relied on the ruling in the ConnectU vs. Zuckerberg case, which holds that jurisdictional defects in an original complaint may be solved by amending the complaint, except when jurisdiction is based on diversity. And then the judge referenced the Supreme Court’s decision in U.S. ex rel. Carter, that more clearly defines the word “pending,” and which states that only pending qui tam cases may bar later qui tam cases. By combing the sum of theses previous rulings, a whistleblower is able to maintain her claim and overcome the first to file bar.
Why is this Ruling Important?
Judge Selya’s opinion is important because, a whistleblower who must file an entirely new case in such a situation will often lose her claims due to the statute of limitations expiring, protests from other relators competing for first-to-file, and public disclosure challenges. However, this decision will not only save time in the courts, it will help the whistleblower save valuable resources while allowing her to continue to hold onto her claims. Now that a whistleblower has the ability to amend or supplement her existing complaint, she and her attorney can focus more energy on the facts of her case and routing out fraud.
Waters & Kraus Can Help You Report False Claims Fraud
At Waters & Kraus, LLP, our lawyers are well versed in the application of the False Claims Act. If you are aware of a company or individual engaging in unlawful conduct to purposefully increase the claims paid for with public funds, there are remedies recognized by many states as well as the federal government. Please contact us