In order for a whistleblower, or “relator”, to successfully prove that a defendant violated the False Claims Act, she must first plead the elements necessary to establish a “plausible” claim. Unless the relator properly alleges a claim, her complaint will not survive a motion to dismiss under the Federal Rules of Civil Procedure. The relator’s allegations in her complaint must contain facts that allow the court to believe the defendant’s conduct was unlawful.
Section 3729(a)(1) parts (A) through (G) of the False Claims Act lists various ways a relator can establish liability against a defendant or defendants for defrauding the government. Under section 3729(a)(1)(A), a defendant is liable who “knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval.”
Federal Rule of Civil Procedure 9(b) requires a relator allege the circumstances constituting fraud “with particularity.” This is important for relators to understand because the Federal Rules create a heightened pleading standard for whistleblowers, or any litigant, who alleges fraud as part of their claim. Many courts have addressed the whistleblower’s heightened pleading standard and agree that the False Claims Act requires relators allege “facts as to time, place, and substance of the defendant’s alleged fraud,” particularly, “the details of the defendants’ allegedly fraudulent acts, when they occurred, and who engaged them.” See Urquilla-Diaz v. Kaplan University, 780 F.3d 1039 (11th Cir. 2015).
It is not enough for a whistleblower to allege that a defendant disregarded federal regulations or operated using improper internal practices. Instead, to establish liability under section 3729(a)(1), the whistleblower or relator must allege that the defendant knowingly asked the government to pay money that the government did not owe. The central question which a relator must address when stating a claim is whether the defendant presented, or caused to be presented, to the government a false or fraudulent claim for payment.
Under Federal Rule of Civil Procedure 9(b)’s heightened pleading standard, the relator must allege with particularity that an actual claim was presented for payment. Hopper v. Solvay Pharm., Inc., 588 F.3d 1318, 1326 (11th Cir. 2009). In order to meet her pleading requirement, the relator must allege particular facts about the “who, what, where, when and how of fraudulent submissions to the government.” Urquilla-Diaz, 780 F.3d at 1052, citing Corsello v. Lincare, Inc., 428 F.3d 1008, 1014 (11th Cir. 2005).
Unlike section 3729(a)(1)(A), section 3729(a)(1)(B) does not demand proof that the defendant presented or caused to be presented a false claim or false record to the government. Even though this section does not require proof of presentment of a false claim, the plaintiff/whistleblower must still show that the defendant made a false record or statement for the purpose of getting a false claim paid or approved and allege that the defendant’s false record or statement caused the government to actually pay a false claim, either to the defendant directly or to a third party. Urquilla-Diaz, 780 F.3d at 1052, citing Hopper, 588 F.3d at 1327. Rule 9(b)’s heightened pleading requirements also applies to section 3729(a)(1)(B). This means that the relator must allege with particularity that the defendant’s “false statements ultimately led the government to pay amounts it did not owe.” Id.
The False Claims Act also provides liability for false certification of a claim. Under this theory of liability, a defendant is liable who certifies to the government that it has complied with statutory, regulatory or contractual requirements as a condition for payment. In order for a whistleblower to allege a claim under a false certification theory, she must allege facts showing (1) a false statement or fraudulent course of conduct, (2) made with knowledge, (3) that was material, causing (4) the government to pay out money or forfeit money owed to the government. U.S. ex rel. Hendow v. Univ. of Phx., 461 F.3d 1166, 1174 (9th Cir. 2006). It is not enough to allege simple regulatory violations. Instead, the relator must show through her allegations that the defendant’s false certification of compliance was a prerequisite for the defendant to obtain payment from the government.
Jason Cornell is an attorney who represents whistleblowers with the law firm Clark Fountain LaVista Prather Keen & Littky-Rubin. Clark Fountain represents plaintiffs in various matters throughout the United States. If you have questions regarding the issues addressed in this or other posts, you can reach Jason at firstname.lastname@example.org.