Yesterday, in Kellogg Brown & Root Services, Inc., et al. v. United States ex rel. Carter, 575 U.S. __ (2015), the Supreme Court settled two important questions under the False Claims Act (the FCA). In a unanimous decision authored by Justice Alito, the Court held: (1) the Wartime Suspension of Limitations Act (WSLA) applies only to criminal actions, and thus the statute of limitations under the FCA is not tolled under the WSLA while the United States is at war; and (2) the FCA first-to-file bar prevents the filing of an FCA action only when a related action is pending, not when a related action has been filed but dismissed.
2014 was a banner year for federal recoveries under the False Claims Act (“FCA”). In a press release dated November 20, 2014, the DOJ announced that its total recoveries – including those from both settlements and judgments – amounted to $5.69 billion for the fiscal year ending September 30th. These results mark the first time that annual recoveries have exceeded $5 billion, and they continue a recent trend of aggressive FCA enforcement. The FCA is the primary civil statute through which the DOJ combats fraud on the federal Government. It includes qui tam provisions which provide monetary incentives for whistleblowers to file suit directly against wrongdoers. $3 billion of FY 2014’s $5.69 billion recoveries arose from qui tam actions, with the Government paying $435 million to reward the whistleblowers. The number of qui tam suits has exceeded 700 for each of the last two fiscal years, far exceeding the 300 – 400 per year in the period between FY 2000 and 2009.