I have frequently discussed on this blog how the False Claims Act aims to prevent companies working for the federal government from providing inferior goods, overcharging, charging for work not performed, and providing kickbacks. If a whistleblower comes forward and reports occurrences of this sort of illegal behavior, the False Claims Act also provides explicit protection to them in the form of significant fines, double back pay, and other penalties for any retaliatory acts. One question that sometimes arises, however, is who can be a whistleblower. I wrote this blog post to cover a common question, specifically, whether a company can be a whistleblower.
If you are considering becoming a whistleblower here in Mississippi, you will need the help of an experienced whistleblower attorney. Contact Barrett Law now at (800) 707-9577 to attain the guidance you require.
Can a Subcontracting Company Be a Whistleblower Under the False Claims Act?
In 2009, the U.S. Congress made updates to the False Claims Act to include “contractors” and “agents” to the list of parties that can make a whistleblower claim under the False Claims Act. The question arising from these changes was what do “contractor” and “agent” mean? A recent federal court case suggests that a corporation can be a whistleblower as well, not just an individual.
In this case, Munson Hardisty LLC v. Legacy Pointe Apartments, Munson Hardisty—a corporation and subcontractor of Legacy Pointe—exposed that Legacy Pointe was defrauding the U.S. Department of Housing and Urban Development (HUD). Specifically, Legacy Pointe reorganized its corporation and corporate filing so that it could apply for HUD financing for a construction project. Previously, Legacy Pointe had been barred from applying for HUD financing. Munson Hardisty withdrew as a partner in the enterprise when it learned of Legacy Pointe’s malfeasance. In retaliation, Legacy Pointe refused to pay Munson Hardisty for over $2 million in work performed. Munson Hardisty sued as a whistleblower, claiming that the False Claims Acts retaliation protections should cover it. The federal court agreed with Munson Hardisty, holding that the corporation fell within the precise meaning of the word “contractor” even though it was not a person doing the contracting. As a result, the court found that the retaliation provisions of the False Claims Act applied to Munson Hardisty as a corporation. They received the money due to them plus costs and fees. I am sure this case will be appealed, and it will be interesting to see if the appellate courts uphold this holding.
This case represents a welcome expansion of the False Claims Act and is one that makes a lot of sense. The False Claims Act’s goal is to protect the federal government from fraudulent activities—it shouldn’t matter who or what reports the fraud.
What Should You Do if You are Considering a Whistleblower Claim?
Are you considering filing a whistleblower case regarding fraud occurring against the federal government? The reward for submitting a successful claim can be massive, 15 to 30% of any amount recovered, but don’t fool yourself—you will only reap this sort of award with the help of an experienced whistleblower attorney. The U.S. Department of Justice receives thousands of potential whistleblower claims each year and only those that are reported in a way that triggers their interest are investigated. Careful pleading is key to this process and will require the help of an experienced whistleblower counsel. Contact Barrett Law now at (800) 707-9577.
Experienced whistleblower lawyer Barrett can provide you with the advice you will need to file a successful whistleblower case. Having expert legal advice by your side can mean the difference between receiving your share of a whistleblower reward and losing your career and livelihood. Call us today.