Costa Mesa, California – False Claims Act and Whistleblower Attorneys
Stephen Danz and Associates represents whistleblowers throughout the United States. Our practice includes the highly specialized and complex Qui Tam lawsuits where private individuals called relators trust our attorneys to bring forth their cases in Southern California courts. Within those courts, we aim to represent individuals from Costa Mesa, California. Over the last thirty years since the 1986 amendments to the False Claims Act (“FCA”), the FCA has become the main weapon in the government’s arsenal to battle fraud, waste and abuse on federal and state governments.
The FCA was first enforced in the Civil War to handle procurement fraud by suppliers to the Union Army. It was rarely used by the government until it was amended in 1986. The 1986 amendments, combined with the 2009 and 2010 amendments, bolstered several key sections of the FCA statutes. These included the whistleblower and damages sections where they made it easier for the government and whistleblowers to file lawsuits. (31 U.S.C. §§ 3729-3733.
Damages and Penalties
A company found in violation of the FCA is liable for:
• A civil penalty in the amount between $10,957 and $21,916 (as adjusted from time to time), plus three times the amount of damages the government sustains (31 U.S.C. § 3729(a)(1); 82 F.R. 9131-01; 28 C.F.R. 85.5).
• The costs of bringing the civil action to recover penalties and damages (31 U.S.C. § 3729(a)(3)).
The court may reduce the treble damages to double damages if:
• The gross multiplier rule. Under this rule, the court trebles the amount paid by the government and only then subtracts any value received by the government.
• The net multiplier rule. Under this rule, the court deducts the value received by the government from the single damages figure before it is trebled or doubled.
The gross multiplier rule is derived from the decision of the Supreme Court in United States v. Bornstein, where the court held that “damages should be [multiplied] before any compensatory payments are deducted, because that method of compensation most faithfully conforms to the language and purpose of the Act” (423 U.S. 303, 314 (1976); see also United States v. Eghbal, 548 F.3d 1281, 1285 (9th Cir. 2008) (citing Bornstein in support of the gross multiplier rule)).
However, the Seventh Circuit recently rejected the gross multiplier approach to calculating damages (United States v. Anchor Mortgage Corp., 711 F.3d 745, 751 (7th Cir. 2013)). In adopting the net multiplier rule, the Seventh Circuit joined the Second, Sixth and DC Circuits (see U.S. ex rel. Feldman v. van Gorp, 697 F.3d 78, 87-88 (2d Cir. 2012); United States v. United Techs. Corp., 626 F.3d 313, 321-22 (6th Cir. 2010); Sci. Apps. Int’l, 626 F.3d at 1278-79).