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Qui Tam (or Whistleblower) Laws Have a Long History

Qui Tam | Lawsuits, Lawyers | Whistleblowers, Moneys Recovered, Civil False Claims Act | Defective Products, Inferior Material, Illegal Price Gouging, Union Army

Qui Tam (or Whistleblower) Laws Have a Long History

Qui Tam (or Whistleblower) Laws Have a Long History

Qui Tam, or whistleblower, laws have existed in Western cultures for over 600 years. An early example can be traced back to the U.S. Civil War, when Congressional hearings disclosed widespread instances of military contractor fraud that included defective products, substitution of inferior material, and illegal price gouging of the Union Army.

At the urging of Abraham Lincoln, Congress enacted the Civil False Claims Act, including Qui Tam provisions, as a tool to fight fraud. Between 1863 and 1986 the law was seldom used. But as a result of 1986 amendments, Qui Tam actions have increased dramatically and have been the most effective and successful means of combating procurement and program fraud. Since 1986, Qui Tam recoveries have exceeded $1 billion with most of the successes involving fraud in Defense and Health Care programs.

The False Claims Act states that whistleblowers are to be rewarded with a percentage of the money that the government recovers as a result of Qui Tam lawsuits. This provision helps encourage people to assist the government in reducing Medicare fraud, defense fraud and other kinds of fraud, despite the effect whistleblowing might have on their jobs and personal lives.

Under the False Claims Act the government may recover up to three times the amount of money it lost as a result of the defendant's fraud. The whistleblower's share is calculated based upon the amount the government recovers, not the actual losses.

A number of factors determine how much money a whistle-blower will receive if the government is able to recover money from the defendant. If the government joins the case, the whistleblower is entitled to at least 15 percent, but not more than 25 percent of what the government recovers.

If the government declines to join the case and the whistleblower continues with a suit against the defendant, the whistleblower is entitled to at least 25 percent, but not more than 30 percent of the money the government recovers.

Affordable Care Act Infuses Qui Tam with New Lifeblood

The Affordable Care Act, passed during President Obama’s administration, has enabled the Centers for Medicare & Medicaid Services (CMS) to expand its efforts to prevent and fight fraud, waste and abuse. Since passage of the act, the CMS has revoked the ability of some 14,663 providers and suppliers to bill Medicare since March 2011; it has also recovered $14.9 billion.

Seniors on Medicare played a large role in helping the government to make that recovery; primarily, they used a Medicare hotline to report instances of fraud they noticed on their statements. As of mid-2013, the government was working on bolstering its efforts to incentivize these Medicare whistleblowers: It has proposed legislation that will enable whistleblowers to collect nearly $10 million in some instances; the previous cap has been about $10,000. Additionally, the CMS will be rolling out redesigned quarterly Medicare statements, which are meant to help seniors more easily notice fraudulent billings.

Legal Help for Individuals Who Would Like to Bring About a Qui Tam Lawsuit

If you are a current or former employee and have information on any illegal activities, please fill out the form at the right for a free case evaluation by a qualified attorney or call us at 1-800-YOURLAWYER (1-800-968-7529).

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Drug Maker Ranbaxy Settles Whistleblower Case for $500 Million

May 16, 2013
Generic drug maker, Ranbaxy Laboratories, just settled an eight-year whistleblower case for $500 million with the U.S Food and Drug Administration (FDA). The case is considered the highest profile generic drug violation in the United States. Whistleblower, Dinesh Thakur, was director and global head of Research Information and Portfolio Management at Ranbaxy Laboratories from 2003 through 2005, according to Money Control. In 2005, Thakur reported to management that Ranbaxy’s Ponta Sahib...

Actos Maker Accused of Hiding Heart Side Effects in Whistleblower Lawsuit

Mar 8, 2012 | Parker Waichman LLP
A whistleblower lawsuit recently unsealed in Massachusetts federal court will likely raise more concerns about the safety of Actos.  The whistleblower, a former medical reviewer for Takeda Pharmaceuticals, the maker of Actos, alleges that the company did not properly classify cases of congestive heart failure associated with the type 2 diabetes drug when they were reported to the U.S. Food & Drug Administration (FDA) Adverse Event Reporting System.Congestive heart failure is a...

IRS Tax Whistlblower Gets Record $104 Million Award

Jan 1, 2012 | Parker Waichman LLP
A former executive at the Swiss bank UBS AG has been awarded $104 million by the Internal Revenue Service for acting as a whistleblower exposing rampant tax fraud. According to a Christian Science Monitor report, Bradley Birkenfeld will receive his award for stepping forward, partially accepting blame for his role in the tax fraud at UBS, and potentially leading to thousands more tax evasion cases. The $104 million award represents the largest sum ever awarded by the IRS in a whistleblower...

SEC Gives Final Approval to Security Fraud Whistleblower Rules

May 27, 2011 | Parker Waichman LLP
The Securities and Exchange Commission (SEC) has approved new rules for securities fraud whistleblowers.  According to a report in The Los Angeles Times, under the new rules, whistleblowers could be awarded multimillion-dollar payouts for reporting securities fraud.The new whistleblower provisions were part of the Dodd-Frank Wall Street reform law.   Under the law, the SEC may award between 10 and 30 percent of any monetary sanctions that exceed $1 million to whistleblowers...

Glaxo to Pay $750 Million to Settle Federal Whistleblower Suit Over Defective Paxil, Other Drugs

Oct 27, 2010 | Parker Waichman LLP
GlaxoSmithKline has agreed to plead guilty and pay a $750 million fine to settle a US Justice Department investigation into the manufacture of defective pills, including the antidepressant Paxil, at its plant in Cidra, Puerto Rico. The government’s case against Glaxo stemmed from a whistleblower lawsuit filed by a former employee. Under the federal whistleblower statute, that individual is entitled to receive $96 million from the Glaxo settlement. The GlaxoSmithKline settlement...

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