U.S. Court of Appeals for the Fourth Circuit

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Fourth Circuit declines to review decision en banc; panel decision allows trial lawyers to file duplicative claims under the False Claims Act

April 23, 2013

The Fourth Circuit denied the Chamber’s motion for leave to file an amicus brief and denied the petition for rehearing en banc.

U.S. Chamber files amicus brief

April 01, 2013

The U.S. Chamber urged the Fourth Circuit to review en banc a decision by a Fourth Circuit panel, which would greatly expand how trial lawyers can use the False Claims Act against businesses that contract with the government. The panel did this by deciding two things. First, it dramatically increased liability under the Wartime Suspension of Limitations Act (WSLA) by allowing private plaintiffs to go after companies for any alleged fraud against the government while the government is engaged in “armed hostilities”. (The WSLA was originally designed to give the government the right to go after criminal fraud that occurred while the United States was at war – even if the statute of limitations had run on the fraud claim.) Second, the panel held interpreted the FCA’s “first to file” provision as allowing relators to file duplicative lawsuits as long as none of the lawsuits were pending at the same time.

The Chamber argued that the combined effect of these two rulings will be to allow trial lawyers to indefinitely toll the statute of limitations for all claims involving alleged fraud against the government and then to use this indefinite toll to file duplicative claims one after another, essentially assuring businesses can be subjected to litigation on the same issue over and over again.

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