First-to-File Bar in False Claims Act Cases

The first-to-file bar says that essentially the person who files the case first almost always has the priority right in the allegations and those filing after do not have the right to file a case and/or collect under those allegations.

This gets complicated quickly because even though the whistleblowers may file a case against the same defendant over similar allegations, some of those allegations may have overlap entirely and some may not. Therefore, the first-to-file bar in False Claims Act cases becomes complicated relatively fast. It can be challenging to determine which case is stronger than the other and which allegations do or do not overlap.

The first-to-file Bar says that the person filing the case who is first to do so is the rightful whistleblower in a case. For more information, reach out to a seasoned False Claims Act lawyer.

How Unique Does a Case Have to be to Survive the First-to-File Rule?

No one knows exactly how unique a False Claims Act case must be. If the case involves different transactions, a different sort of set of money, that would help with the determination. If the case shares the exact same fact as the secondary case, the first case is in the position of owning those allegations against the defendants.

The uniqueness of a case and whether it survives the first-to-file Rule is up to the judge and what the various relators can negotiate. There is always a possibility of coming to an agreement between a first, second, third, and fourth filed case as to what new facts and allegations may come forward. Case law in Washington, DC supports the idea that if the government is on notice of the fraud, that precludes further analysis.

Public Disclosure Bar

The public disclosure bar has a sort of long history here that comes from back when the act was a different iteration. Such as when it was possible to stand on courthouse steps, find out that the government has indicted someone and then run into the court and file a civil case in an attempt to collect money based on government action.

In 1986, when the False Claims Act was brought back to life, it included a bar saying unless someone was the original source of the information and if their allegation has been publicly disclosed, they could not file the case. The public disclosure bar was jurisdictional, which meant that the defendant could raise that defense at any time and, in practice, that meant that it would. What constituted a public disclosure was broadly defined, and qualifying as an original source became a continual area of litigation.

In 2010, under the Affordable Care Act, the public disclosure bar was amended, and now, it can even be waived by the government. The original sources of the provision are a little easier to make for the Relator. What constitutes a public disclosure is a little bit more narrowly defined and perhaps a little fairer. The idea behind it is someone should read the newspaper and go file a case based on what they have read in the newspaper. Some attorneys would argue that it does not matter, that the idea is to get the government money back for fraud committed against the government and a person files it before the government or someone else does, and that it should not matter where the Relator obtains the information.

That is the position of many attorneys who do not really agree that there is any value of restricting a Relator’s way of finding a legitimate fraud case as long as it is a legitimate fraud case. However, they are in the minority. The holdings in the court are decidedly on the side of requiring a Relater to obtain the information themselves and be an original source themselves and not to be basing their allegations on public material.

Importance of Obtaining an Attorney

The False Claims Act does not involve a standard set of procedures that most lawyers do every day. It has also become a more difficult area of the law to pursue. Certainly, there are many lawyers who are qualified to do it. In addition, the modern history of the law is as of 1986 when it was amended, and brought back to life. As a result, there is a relatively fast-expanding case law on false claims act since modern laws have about 30 years of decisions. The last 10 years or so may cover about half the total number of decisions to consider so there is much new to know.

Therefore, a lawyer who has some level of familiarity with the law itself and the procedures required could be helpful to a Whistleblower facing a multi-year situation when they are going to have to be able to talk to a lawyer about their case. Furthermore, because the case is under seal, the Relator faces the additional burden of being able to talk only to their lawyer about the case. They probably want a lawyer who has an understanding of how this works and is used to it. Call today about the first-to-file bar in False Claims Act cases.

Tony Munter Whistleblower Attorney

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Tony Munter Attorney at Law
409 7th St NW,
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Washington DC  20004