According to the Supreme Court, in False Claims Act “qui tam” suits, the federal government can move for dismissal of a case over the relator’s objection even outside of the “seal period.” A key factor considered for government dismissal post-seal period may include burdensome discovery, which means employers facing qui tam actions should strategically consider this and other pressure points in the course of litigation.

On June 16, 2023, in United States ex rel. Polansky v. Executive Health Resources, Inc., the U.S. Supreme Court resolved a circuit split in favor of a broad interpretation of the federal government’s ability to dismiss False Claims Act (FCA) actions over a relator’s objection. In affirming the Third Circuit’s 2021 decision, the Supreme Court found that the federal government can exercise its authority to dismiss an FCA case so long as it intervened in the case at some point in the litigation. The Court also clarified that the rule for voluntary dismissal of ordinary actions, Federal Rule of Civil Procedure 41(a), governs the dismissal standard for FCA actions.

Background

Otherwise known as the “Lincoln Law,” Congress enacted the FCA in 1863 in response to rampant fraud and war profiteering during the Civil War. The FCA deputizes private citizens—referred to as “relators”—to bring suit on the government’s behalf to prosecute those defrauding the government through the knowing¹ submission of false claims for payment. These actions are called “qui tam”...

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