False Claims Act lawsuits have led to the recovery of in excess of $44 billion dollars spanning a period of 1986-2014. Whistleblowers who have commenced lawsuits have accounted for $30 billion of the amount recovered. Further, the successful prosecution of these qui tam claims has generated more than $4.7 billion in payments to whistleblowers who have assisted the government in recovering public funds for taxpayers. There were over 713 False Claims Act lawsuits commenced by whistleblowers in 2014 alone. Many people weighing whether to come forward to expose fraud that results in the depletion of tax revenue are unsure how awards under the False Claims Act are calculated and paid.
While the recovery typically will be comprised of multiple types of compensation, such as a share of the money recovered or disgorged and penalties as well as reasonable attorney fees and costs. The amount the whistleblower (referred to as the “Relator” under the False Claims Act) is entitled to be paid falls between 15 and 30 percent of the “proceeds” obtained in the qui tam lawsuit settlement or judgment. The proceeds include the money or benefits recovered, which includes treble damages, along with penalties amounts assessed. Where the recovery falls along the 15-30 percent continuum will depend on whether the government intervenes and the extent of the Relator’s involvement in prosecuting the case and providing information.
Evaluating the Appropriate Percentage of the Proceeds
Relators will typically obtain a far more substantial recovery if they have legal representation because evidence must be presented to justify the Relator’s percentage of the proceeds. The minimum 15 percent sum is intended for cases where a “finder’s fee” is appropriate according to a report produced by the Senate Judiciary Committee. Although the government frequently will argue for this minimum threshold recovery, this percentage is only intended when the Relator commences the case that leads to a recovery and takes no other role or provides no other information or evidence used to obtain the judgment or settlement. When the involvement of the whistleblower involves providing supporting documents, testimony, and other facts and/or continuing to actively participate in the qui tam action, the recovery should be significantly higher up to a maximum of 30 percent.
Proving Right to Higher Percentage Based on Senate Factors
The experience of your False Claims Act attorney can significantly impact this percentage. Courts frequently utilize two different systems for calculating the percentage of the proceeds to be awarded: (1) Senate report factors and/or (2) Guidelines from the U.S. Department of Justice (DOJ). However, the DOJ guidelines do not carry the force of law, so these should only be argued to the extent they support the Relator’s claim to a more significant percentage of the proceeds. The Senate report identifies three factors to be evaluated: (1) contribution by the Relator to the outcome of the case; (2) the “significance” (e.g. importance, relevance, and scope) of the information provided by the Relator; and (3) prior knowledge of the fraudulent activity by the government. When filing a motion seeking the Relator’s share of the proceeds, persuasive advocacy that provides facts and evidence in these three areas is essential.
Guidelines from the U.S. Department of Justice
The DOT has its own guidelines that list potential considerations that support either increasing or reducing the amount of recovery. The list of factors is lengthy, but examples include:
- No knowledge of the fraud by the government
- Extensive detail and information furnished by the Relator
- Warning provided regarding a significant public safety concern
- Prompt reporting of the illegal practices
- Significant assistance during the pre-trial and investigation stages of the lawsuit
- Discontinuation of the fraudulent activity after bringing claim
- Relative size of the financial recovery
Our Mississippi False Claim Act Lawyers assist our clients in gathering and presenting information relevant to the approximately two dozen factors that might favor our client receiving more funds. At Barrett Law, our Mississippi Qui Tam Lawyers work to protect individuals who expose corrupt and unlawful practices while seeking the fullest compensation for whistleblowers. Contact our firm today at 800.707.9577 to schedule your free consultation, so we can answer any questions you may have regarding filing car accident case.