Restrictive Covenant Clauses and Qui Tam Suits

Some employees with information about fraud are reluctant to start a False Claims Act case due to fear of retaliation. In some cases, employees fear they will face legal difficulties due to non-disclosure agreements with their employer.

If you have information about fraud against the government and are interested in being a whistleblower, you should consult with an experienced attorney. They could explain how restrictive covenant clauses impact qui tam suits and if this applies to your case.

Non-Disclosure Agreements

It usually not the case that a restrictive covenant agreement signed as part of an employment contract can prevent a whistleblower from having the right to file a False Claims Act case. When talking about a specific waiver of a general release of lawsuits, that is a much more complicated analysis. For example, if a whistleblower signs a release pursuant to another employment law case, jurisdictions differ as to how much, when, or whether such a release can interfere with this process. One thing to remember is that when an individual is reporting information to the government; they are not taking a trade secret and giving it to a competitor.

It is a different action in kind to pursue a matter on behalf of the government, and the right to do so is a bit harder to waive and more restricted. The defense is doing everything they can to fight that and find a way to enforce these kinds of things. However, in a non-compete, non-disclosure agreement, those are not going to prevent a person’s right to go to the government with evidence of fraud against the government. Obviously, these kinds of issues are appropriate to raise with counsel and determine prior to filing a case.

Difficulty Filing a Qui Tam Case

If a federal government employee has a job to investigate fraud, and they are a factor in the area of their inspection, that might not be an appropriate person to bring in a case. One has to bring information to the government voluntarily. If a person is already convicted of a crime related to the fraudulent activity they want to report, or if they planned and initiated the fraud, they may have a bit of a problem bringing the case.

Alternatives to a False Claims Act Lawsuit

Almost any other alternative will not have the same power and weight as bringing a case under the Federal False Claims Act. However, individuals may have other options. The first thing a person needs to do is determine if there is a precedent to bring that case.

When a person brings the case, if they can make a good-faith allegation that the company or defendant is committing fraud against the United States, there might be no better way to get the government to sit up and take notice of that activity conducted by a company. The Department of Justice does investigate these cases and has pursued them. While there may be other alternatives, the fact of the matter is that the first alternative to look at if someone wants to report fraud against the government is the False Claims Act.

Consult with a Qui Tam Attorney

Even if you are bound by restrictive covenant clauses in your employment contract, you may be eligible to bring a False Claims Act qui tam suit. The first step is to sit down with a whistleblower lawyer and discuss your case. An attorney could explain your legal options and provide expert guidance through every step of the case. Call today to set up a consultation.