In the world of qui tams, it is usually the whistleblower pushing cases to trial. But on February 23, 2023, a federal judge in West Virginia set down for trial a hospital’s case against a whistleblower. Now, in a trial set for late March 2023, a jury is set to determine whether a whistleblower and the general counsel for a competing health system engaged in malicious prosecution and tortious interference by filing a qui tam against a West Virginia hospital.
On January 10, 2018, citing costs associated with record increases in the number of qui tam actions filed under the False Claims Act, the Department of Justice issued a memorandum to certain DOJ attorneys, strongly signaling the Department’s intent to liberalize its use of section 3730(c)(2)(A) to seek dismissal of qui tam actions.
In the recently leaked memo, Michael Granston, Director of the Fraud Section of DOJ’s Commercial Litigation Branch, outlines “a general framework for evaluating when to seek dismissal” by identifying seven factors that have supported DOJ’s previous successful dismissal requests and emphasizes that the Department views its dismissal authority as one subject only to “highly deferential” review by the courts. The memo suggests DOJ will seek dismissal of these actions more often, making use of its authority to seek dismissal as “an important tool to advance the government’s interests, preserve limited resources, and avoid adverse precedent.” As further indication that the Department intends to pursue aggressively any available means of dismissal of these cases, the Director also recommends asserting in the alternative other independently available grounds for dismissal or requesting partial dismissal where appropriate, and the memo reminds attorneys that dismissal may occur at any stage of the proceedings, depending on the circumstances. The Director also stresses the importance of communication between the DOJ, the affected agency, and relators as a means of encouraging voluntary dismissal.
Continue Reading DOJ Signals More Liberal Exercise of Power to Dismiss Qui Tam Actions under the FCA