The Qui Tam Blog

By: Joel Androphy, Rachel Grier, and Stephanie Gutheinz

The FCA provides that all qui tam complaints must be filed under seal and must remain under seal for 60 days after filing.  During the 60-day period after filing, the government investigates the allegations and determines whether to intervene in the action.  In American Civil Liberties Union v. Holder, three non-profit organizations challenged the FCA’s seal provisions, arguing that the provisions amount to unconstitutional content-based restrictions and unconstitutionally deny access to information regarding important public interests.  The district court dismissed the challenge, holding that the seal provisions do not offend any constitutional protections. 

The court noted that the FCA is not an access statute because its seal provisions do not regulate access to information possessed by law enforcement; rather, the provisions temporarily limit public access to the qui tam relator’s allegations of fraud.  In holding that the seal provisions are narrowly tailored to serve the government’s compelling interest in investigating allegations of fraud, the court acknowledged that public access to qui tam complaints would not enhance the efficient and just resolution of cases, but would actually hamper the government’s investigation by tipping off wrongdoers.  Based on these consequences, the court held that no right of access to a sealed qui tam complaint exists, specifically noting the strong possibility that public access could lead to the destruction of evidence. 

The court further held that the seal provisions do not constitute a prior restraint on speech because the seal merely prevents the disclosure of the existence of the qui tam suit, rather than the facts upon which the suit is based.  Finally, the court rejected the argument that the mandatory seal provisions violate the separation of powers because courts are not permitted to determine the necessity of a seal on a case-by-case basis.  The court reasoned that the mandatory seal is nothing more than a ministerial act and does not require judges to enter an order without considering the merits.  Furthermore, judges eventually have the opportunity to consider the necessity of a seal on a case-by-case basis when the seal is going to expire and the judge must determine whether there is good cause to extend the seal.  American Civil Liberties Union v. Holder, 2009 WL 2596641 (E.D. Va. Aug. 21, 2009).

By: Joel Androphy, Rachel Grier, and Stephanie Gutheinz

In United States ex rel. Eisenstein v. City of New York, New York, the United States Supreme Court considered the applicable time period for filing a notice of appeal in FCA actions where the United States has declined to intervene.  Generally, a notice of appeal must be filed within 30 days; however, the time limit is extended to 60 days when the United States is a party to the action.  The Supreme Court held that, even though the United States is a real party in interest in every action brought under the FCA, it is not a “party” to the action unless it exercises its statutory right to intervene. 

Therefore, when the United States declines to intervene, the 30-day period for filing a notice of appeal applies rather than the extended 60-day period.  The Court reasoned that any other interpretation would render the FCA’s intervention provisions superfluous.  Because the FCA expressly gives the United States discretion to intervene in FCA actions, courts cannot disregard the government’s decision as well as congressional intent by designating the United States a “party” even though it has declined to assume the rights and burdens associated with acquiring the primary responsibility of prosecuting the action. 

United States ex rel. Eisenstein v. City of New York, New York, 129 S. Ct. 2230 (2009).