What: The U.S. Supreme Court recently granted certiorari on a petition seeking to curtail the U.S. Department of Justice’s (DOJ) ability to dismiss False Claims Act (FCA) qui tam cases, even if DOJ has determined that the case is likely meritless or will be costly for the Government to pursue.
Takeaways and Industry Impacts:
On June 21, 2022, the Supreme Court announced its decision to hear United States ex rel. Polansky v. Executive Health Resources Inc. in which the Relator-Petitioner raises two issues critical to DOJ’s ability to move for and secure dismissals of FCA qui tam cases under 31 U.S.C. § 3730(c)(2)(A). The first is whether DOJ forfeits its right to move to dismiss a case if it initially declined to intervene. The second is, if DOJ retains its dismissal authority post-declination, what standard of review should courts apply to such motions to dismiss. In other words, is the Section 3730(c)(2)(A) hearing “merely a forum for the relator” to try to persuade DOJ not to dismiss, “or is it an adversarial hearing to inform the District Court’s ruling”? The Supreme Court’s upcoming ruling could provide more clarity and more incentive for DOJ to dismiss meritless or wasteful qui tam actions earlier in the litigation—possibly as early as its decision not to intervene.
The second issue—the dismissal standard—essentially boils down to how deferential courts should be to DOJ motions to dismiss qui tam actions. Although the circuit courts have promulgated numerous...
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