Login | Store | Training | Contact Us  
 Latest News 
 Product List 
 Related Links 

   HomeLatest News

FCA Relators Awarded $8.1 Million Share of Settlement

The District Court for the Eastern District of Arkansas awarded qui tam False Claims Act relators a share of the proceeds of the government's settlement because the government intervened in the relator's action and settled the claims. The relators' suit had been pending for over three years when the government intervened and entered into a settlement agreement with the contractor. In exchange for the government's release of its claims of defective disclosures of pricing information, the contractor agreed to pay the government $44.16 million, and a third party agreed to pay $3.84 million. Under 31 USC 3730(d), relators are entitled to a 15 to 25 percent share of the settlement proceeds when the government pursues an action brought by relators. The percentage to be awarded depends on the extent to which the relators contributed to the prosecution of the action.

Relators Were "Catalyst"

After reviewing the factors set forth in the legislative history, the Department of Justice's internal FCA guidelines, and case law, the court awarded the relators 17 percent of the contractor settlement, which was equal to $7,507,200. The minimum share of 15 percent is generally viewed as a finder's fee. Here, the relators' complaint alleged conduct similar to the conduct detailed in the settlement agreement, and they pursued the case on their own for a significant amount of time. When the government intervened, the relators made a significant contribution by providing 700,000 pages of documents and alerting the government to the fraud. However, although the relators were the "catalyst" leading to the settlement, they pursued a kickback theory, which the government asserted did not exist, and the settlement was large. The share of the third-party settlement was 15 percent, or $576,000. The relators did not mention the third party in their complaint, the government maintained it learned of the claims through an audit, and the relators likely provided only indirect assistance with this claim. ( U.S. ex rel. Rille, et al. v. Cisco Systems, Inc., DC ED Ark 2011, 55 CCF 79,659).




(The news featured above is a selection from the news covered in the Government Contracts Report Letter, which is published weekly and distributed to subscribers of the Government Contracts Reporter. )


   2001-2020 CCH Incorporated or its affiliates
Print this Page | About Us | Privacy Policy | Site Map