Qui Tam lawsuits are also known as whistleblower lawsuits. They are based on the False Claims Act, which enables individuals in the private sector to file suit on behalf of the government for actions that have defrauded it through false claims, and for that individual to receive compensation for their assistance if the case is successful.
The phrase qui tam comes from the latin phrase, “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” which translates into, “he who sues in this matter for the king as for himself.” The False Claims Act is also commonly referred to as the Lincoln Law because Abraham Lincoln originally signed it into federal law in 1863, during the course of the American Civil War. At that time many contractors that were selling goods to the Union Army were guilty of constant fraud, selling ammunition, weapons and other items that were inferior. Realizing that it would be nearly impossible to detect every case of fraud the government invited American citizens to become their eyes and ears, offering a percentage of the amount recovered in any subsequently filed lawsuit to those who notified them of the illegal acts.
The False Claims Act has been modified throughout the years but remains largely the same. Those who successfully bring a qui tam lawsuit to trial are able to recover roughly 15-30% of the damages that are won in court, and these damages can easily run into very high figures. But filing a qui tam lawsuit has its challenges. There are very specific requirements that must be met by the “relator”, the person who reports the fraud, and only the first person who reports a false claim is able to recover the reward. Most qui tam cases are brought by employees of government contractors, though some are filed by competitors or subcontractors who may have knowledge of illicit acts. Many cases involve healthcare organizations and government contractors, though in some cases suits may involve private universities, medical providers, and even government officials.
Among the many challenges of filing a qui tam lawsuit are the fact that it must be filed “under seal” and kept secret from the public as well as the company being reported. Only the government is aware of the claim until the Justice Department can determine the validity and strength of the case. Because of this it is essential that the attorneys preparing a qui tam claim have experience in providing enough documentation to compel the government to join the case or to intervene.
Those companies that are charged with a violation of the False Claims Act are required to pay as much as triple the amount that they defrauded the government of, as well as individual penalties for each false claim that they are found to have filed. The Philadelphia law firm of Bochetto & Lentz have successfully represented both whistleblowers and relators as well as those who have been falsely charged with violations of the False Claims Act.