Key Takeaways

• Courts Revisit the Constitutionality of the FCA: Recent federal decisions reflect renewed judicial scrutiny of the False Claims Act’s qui tam provisions, which authorize private individuals to bring enforcement actions on behalf of the United States.
• Federal judges call for Supreme Court review of FCA qui tam provisions: A district court ruling and a Fifth Circuit concurrence both urge reconsideration of prior precedent, citing separation-of-powers concerns under Article II.
• Potential circuit split may prompt broader change in FCA enforcement: If the Eleventh Circuit affirms the Zafirov decision, the issue could head to the Supreme Court and reshape whistleblower-driven enforcement across regulated industries.

Background

The False Claims Act (FCA) allows private citizens (relators) to file suits on behalf of the United States against entities that submit false claims for payment. Successful whistleblowers may recover up to 30% of any government recovery, and the FCA has become one of the government’s most powerful enforcement tools, particularly in healthcare and defense contracting.

Federal Courts Reexamine Constitutionality of FCA’s Qui Tam Provisions

For decades, courts have upheld the constitutionality of the FCA’s qui tam provision. However, on Oct. 1, 2024, Judge Kathryn Mizelle of the U.S. District Court for the Middle District of Florida ruled that the FCA’s qui tam mechanism violates the Appointments Clause because it allows private individuals...

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