September 14, 2015 — As summarized in a previous post, whistleblowers (also known as relators) interested in filing a qui tam case must act quickly, because by statute only the whistleblower who is “first to file” her complaint is entitled to pursue the action with or on behalf of the government. Where, however, a whistleblower is able to establish that her allegations are materially different from those in an earlier-filed complaint, or that her complaint would allow the government to obtain a separate and distinct recovery, she may avoid the first-to-file bar.
Forgoing a First-to-File Fight
In addition to the statutory basis for avoiding the first-to-file bar, whistleblowers may also pursue more practical solutions. In cases where there are multiple active complaints against the same defendant, and where the allegations are similar or overlap, the whistleblowers and their counsel may pursue an agreement to proceed jointly and cooperatively. In exchange for forgoing a first-to-file fight among each other, the whistleblowers agree to litigate (or assist the government in litigating) against the defendant together. As a result, the whistleblowers avoid potentially costly and protracted litigation against each other or the defendant while also combining forces, which may result in a larger recovery for the government.
Agreement May Not Always Be Beneficial
Importantly, not all first-to-file conflicts are or should be resolved by agreement among the whistleblowers. Where, for example, the later-filed complaint does not add to or expand the first-filed allegations, an agreement between the whistleblowers may not be beneficial to the first-in-time whistleblower. Alternatively, where a later-filed complaint does, in fact, expand the case and allow the government or whistleblower to pursue separate or additional claims, the later-in-time whistleblower may want to take her chances in court, arguing that her case is not barred and she is entitled to pursue it.
As with many other aspects of False Claims Act litigation, these first-to-file issues are complex, and require the expertise of experienced and specialized FCA counsel who are equipped to both avoid a first-to-file issue in the first place, or to reach a fair resolution in the event that a first-to-file issue emerges.
Contact Waters & Kraus to learn more about the first -to-file statute or to file a False Claims Act lawsuit. This article was contributed by Caitlyn Silhan, one of the whistleblower attorneys in the firm’s Dallas office.
