Whistleblowers have become a well-known concept to the general public thanks, in large part, to several famous Hollywood films. A whistleblower is anyone who reveals misconduct on the part of a company or their employer. The misconduct often involves fraud or corruption perpetuated for financial gain. The U.S. government is a frequent victim of intentional fraud, costing taxpayers astronomical sums each year.
While the term whistleblower is well known, the lawsuits brought by whistleblowers, called Qui Tam actions, are less understood. The origin of qui tam actions stems from The False Claims Act. Created in 1863 by Abraham Lincoln, the False Claims Act is intended to punish persons or companies who defraud the U.S. government. Within the law is a so-called “qui tam” condition that allows a private person to file suit on the government’s behalf. The concept of qui tam itself dates back to 13th century England.
The False Claims Act offers whistleblowers a financial incentive intended to encourage them to step forward. The whistleblower who successfully files the suit can receive between 15 and 30 percent of the money recovered by the federal government. In 1986, the False Claims Act was strengthened to provide additional whistleblower rights out of concern for rampant fraud in the military contracting industry. Since this time, the number of whistleblower actions filed each year has risen dramatically.
The following is a look at a few high-profile whistleblower cases:
- Pfizer, Inc: In this famous 2009 case, a sales representative for Pfizer, John Kopchinski, filed a qui tam suit against his employer for engaging in fraudulent marketing practices with Bextra. The suit alleged that Pfizer violated the federal laws banning kickbacks by reimbursing Bextra through both state and federal government programs, including Medicaid and Medicare. Pharmaceutical giant Pfizer plead guilty and paid fines in excess of $2.3 billion. This was the largest criminal fine ever imposed in the U.S. Pfizer also paid $1.195 billion in the qui tam action, making it the largest civil settlement against a pharmaceutical company. Kopchinski and six others split $102 million.
- Northrop Grumman: Northrop Grumman is a large aerospace and defense technology company. Whistleblower Robert Ferro filed a qui tam suit against this company, charging it with selling faulty electronic equipment for use with military satellites. The $325 million settlement that resulted is the biggest settlement paid by a defense contractor in this sort of suit. Ferro received over $48 million for his actions in whistleblowing.
- Quest Diagnostics: In this sizable case, Quest Diagnostics, a giant medical lab company, paid a $302 million settlement, representing the largest amount paid by a medical lab company for a faulty product. The qui tam case was filed by a California biochemist. He asserted that Quest’s subsidiary, Nichols Institute Diagnostics Inc., was selling faulty blood kits to medical testing companies and hid the evidence that the kits were inaccurate. This whistleblower was awarded 18 percent of the massive $253 million settlement.
Barrett Law PLLC: Experienced Representation for Qui Tam Whistleblower Actions
Qui tam lawsuits allow the courts to correct and put a stop to fraudulent activity, while also providing whistleblowers with financial compensation for their brave efforts in coming forward. Across three generations and for over 75 years, the Mississippi Whistleblower Attorneys at Barrett Law PLLC have guided whistleblowers through the filing and pursuit of qui tam actions. We have the skill, experience, and dedication to zealously pursue your qui tam case. Barrett Law PLLC offers a free consultation to all new clients and operates on a contingency fee basis. For excellence of legal services unmatched across the state of Mississippi, call Barrett Law PLLC today at 1 (800) 707-9577 to schedule your free consultation.