Posted in False Claims on June 1, 2015
Contracting with the government is big business. Private companies routinely make millions of dollars on contracts, sometimes even hundreds of millions, as was the case with Amazon’s $600 million cloud computing contract with the CIA. The contracts come in all forms, from provider contracts under Medicare and Medicaid to defense contracts to contracts for more every day goods and services.
Generally these contracts provide benefits for everyone involved. The government receives goods and services it needs from specialists in the private sector. Private companies receive contracts that provide them with an influx of income and business, which in turn often prompts the hiring of new employees. Unfortunately, private companies that contract with the government sometimes engage in unethical and fraudulent conduct that costs the government and in turn, taxpayers, money.
It is often the employees of the companies that contract with the government who have the best insider knowledge regarding the companies’ conduct and whether or not it is legal or ethical. Yet, employees are often (and understandably) afraid to come forward with information for fear of losing their jobs. Many don’t know that there are state and federal laws that provide protection and incentives for coming forward.
False Claims Act
Both New York law and federal law include False Claims Acts. The acts, which are substantially similar, allow private individuals to bring suit on behalf of the government against another individual or business entity for making a false claim to the government. False claims can come in many forms, but as the phrase suggests, generally involve a false or fraudulent statement and a claim for payment from the government. A claim for reimbursement under the Medicare program for services that were never rendered is just one example of a false claim.
The actions brought under the False Claims Acts are called “qui tam,” lawsuits. Qui tam is an abbreviation for the latin phrase “qui tam pro domino rege quam pro se ipso in hac parte sequitur,” meaning “who brings the action for the king as well as himself.” In qui tam suits, the private individual bringing them on behalf of the government is entitled to receive a percentage of the recovery if the suit is successful. How much are those who initiate the suit entitled to? It depends on a number of factors, including whether the government itself gets involved in prosecuting the lawsuit, but generally runs in the range of 15 to 30 percent of the recovery.
It’s a percentage that can quickly add up, as many false claims cases involve large amounts. Just recently, the Department of Justice announced that UPS agreed to pay a $25 million to settle a false claims lawsuit brought against it. UPS has many different contracts with the government to provide shipping services. And, as it turns out, over a 10-year period, UPS falsified records to make it appear that certain packages were delivered when, in fact, they never were. The former UPS employee that initiated the qui tam action will receive $3.75 million.
Reach Out to Our Attorneys
If you know about a false claim that has been made to the New York or federal government, contact the employment law attorneys at Joseph & Norinsberg at (212) JUSTICE or by e-mail at email@example.com today to discuss whether you may have a case and what protections are available if you come forward with the information.
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