On June 16, 2023, the US Supreme Court issued this term's second important opinion regarding the False Claims Act (FCA).

In the previous important decision, as noted by our prior update, "US Supreme Court unanimously decided eagerly anticipated False Claims Act case," the Court clarified the knowledge requirements of the False Claims Act.

The most recent opinion decided two critical questions—whether the government can dismiss a qui tam case in which it did not initially intervene during the FCA's statutory 60-day seal period, and the standard of review for that dismissal.

The Court held that the government can move to dismiss later in a case even if it did not initially intervene, that Courts should use Rule 41 of the Federal Rules of Civil Procedure to consider the motion, and that the government is entitled to substantial deference. In short, if the government presents a reasonable argument why a qui tam case should be dismissed, it should be dismissed regardless of when it intervenes absent some extraordinary circumstance.

As brief background, the underlying case involved alleged improper Medicare charges for inpatient rather than outpatient services. The government declined to intervene during the seal period, and the relator (i.e. the whistleblower) took over prosecution of the case, engaging in years of discovery.

The government determined that its discovery obligations were mounting and were implicating significant privilege issues. The government also determined...

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