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Criminal Law Te 1986 amendments vastly strengthened the FCA as a


tool for fighting profiteering and fraud against the government. Specifically, the 1986 amendments increased the relator’s share,10 provided for treble damages and civil monetary penalties,11 granted employees whistleblower protection,12 period of limitations,13 to “actual knowledge,”


extended the


and reduced the level of proof for fraud “deliberate ignorance,” or “reckless


disregard.”14 Te FCA was further amended in 2009 following


congressional concerns that the effectiveness of the act had been undermined by court decisions limiting the scope and purpose of the law.15


Specifically, legislators felt that with the federal


government projected to spend more than $1 trillion under the Troubled Asset Relief Program (TARP) and the Stimulus Bill,16 the FCA needed to be corrected to protect government funds. By enacting the Fraud Enforcement Recovery Act


(FERA) in 2009, Congress began working towards overriding the court decisions that had been limiting the scope and purpose of the FCA. 17


Te enactment of FERA established


new definitions and clarifications in the FCA which previously had been hindering it such as: expanding the definition of a “claim”;


allowing for the protection of funds that have been A key provision of the original FCA awarded 50 percent


of the recovery to the relator (the “relator’s share”) to encourage private citizens to expose fraud.9


Although the modern day


relator’s share is less than 50 percent, relators are still eligible to receive a portion of the recovery, as discussed more fully below.


1943 Amendments Following perceived abuses in a number of “parasitic”


FCA lawsuits filed by plaintiffs relying on information already in the government’s possession or public knowledge, the FCA was crippled by congressional amendment in 1943. Te 1943 amendments greatly reduced the relator’s share and eliminated qui tam lawsuits when the government had taken no action after a number of years. Te 1943 amendments stopped virtually all qui tam cases, and fraud against the government increased.


The 1986, 2009, and 2010 Amendments


During the massive defense buildup of the 1980s, reports of $900 toilet seats and $500 hammers aroused congressional ire. A new era for the FCA was ushered in by amendments of the FCA in 1986 championed by United States Senator Charles Grassley (R-Iowa) and signed into law by President Ronald Reagan.


9 Act of March 2, 1863, ch 67, § 6, 12 Stat 698. 24 Trial Reporter / Summer 2011


administered by the United States government; providing liability for those retaining overpayments paid by the government; allowing “agents” and “contractors” to be included in the category of “employees” when determining who is to be protected, as whistleblower, against retaliation; and clarifying the statute of limitations.18 Ten in 2010, enactment of two new amendments made


further refinements to the FCA. Te Patient Protection and Affordable Care Act (PPACA) revised a provision of the FCA that previously had prevented a court from having subject matter jurisdiction in certain instances.19


Now, thanks to the PPACA


amendments, the issue of whether allegations have been publicly disclosed and therefore are barred is not a jurisdictional one.20 Moreover, PPACA gave authority to the government to prevent court dismissal of an action based on such public disclosures. PPACA also clarified the law in order to extend liability over health care providers that retained overpayments of funds from Medicare and Medicaid claims. Additionally, PPACA definitively establishes that a claim for items or services that result from violations of the Anti-Kickback Statute is a false claim.21


10 31 U.S.C. § 3730(d). 11 31 U.S.C. § 3729(a)(1). 12 31 U.S.C. § 3730(h). Such protection now extends to contractors and agents, as well as employees. 13 31 U.S.C. § 3731(b) 14 31 U.S.C. § 3729(b)(1). Additionally, the FCA now makes clear that “no specific proof of intent to defraud” is necessary.


15 Fraud Enforcement and Recovery Act of 2009, Pub. L. No. 111-21, 123 Stat 1617. 16 American Recovery and Reinvestment Act of 2009, Pub. L. No. 111-5, 123 Stat 115. 17 Id. 18 Id. 19 Patient Protection and Affordable Care Act of 2010, Pub. L. No. 111-148, 124 Stat 119. See also 31 U.S.C § 3730 (e)(4)(A) (as amended in 2010 by PPACA).


20 Id. 21 Id.


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