Until recently, it was well-accepted that a violation of the False Claims Act (FCA) occurs only when there is a misrepresentation that is objectively false.
Four circuits — the Fourth, Seventh, Tenth and Eleventh — had adopted this “objective falsity” standard. In March 2020, however, the Third and Ninth Circuits issued decisions departing from this view, holding that objective falsity is not required and “legal falsity” can suffice. These decisions created a stark circuit split with profound implications for government contractors, and there is now a pending petition to the Supreme Court to address and clarify the matter.
First, a refresher: The FCA does not define “false or fraudulent,” leaving courts to look to common law to interpret what constitutes a “false” claim. Many circuits had found that a representation must be objectively false to qualify as a false claim, meaning that a false claim cannot arise where there is a genuine dispute and a claim is alleged to be false based on a subjective assessment. The Third Circuit was among those endorsing this view, holding that under the FCA “a statement is ‘false’ when it is objectively untrue,” United States ex rel. Thomas v. Siemens AG, 593 F. App’x 139, 143 (3d Cir. 2014), and that “expressions of opinion, scientific judgments or statements as to conclusions which reasonable minds may differ cannot be false.” United States ex rel. Hill v. Univ. of Med. & Dentistry of N.J., 448 F. App’x 314, 316 (3d Cir. 2011).
Keep reading this article at: https://governmentcontractsnavigator.com/2020/11/10/what-qualifies-as-a-false-claim-supreme-court-may-clarify/
IBI is a nonprofit corporation headquartered in West Allis, Wisconsin that receives set-aside contracts from federal agencies under the federal government’s Ability One Program. In exchange, IBI agrees to give jobs to workers who are blind or visually-impaired and comply with other contractual requirements.
The Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136) was passed by Congress and signed into law by President Trump on March 27, 2020. The CARES Act provides over $2 trillion of economic relief in order to protect the American people from the public health and economic impacts of COVID-19. Throughout its more than 300 pages, the CARES Act implements many initiatives targeted at various industries and economic sectors that are designed to stimulate cash flow and provide security for those at-risk.
“The Disadvantaged Business Enterprise (DBE) Program of the Department of Transportation creates important opportunities for small businesses to participate in construction projects paid for with federal funds,” said Assistant Attorney General Jody Hunt of the Department of Justice’s Civil Division. “We will hold accountable those who misrepresent their compliance with program requirements to obtain taxpayer funds to which they are not entitled, and thereby undermine the program’s goal of supporting small businesses.”
To qualify as a small business for purposes of U.S. Small Business Administration (SBA) programs, companies must meet defined eligibility criteria, including requirements concerning size, ownership, and operational control. The settlement with Ross Group resolves allegations that the company fraudulently induced the government to award certain small business set-aside contracts to several affiliated entities that did not meet eligibility requirements.
The settlement with Ross Group and its corporate affiliates resolves a lawsuit filed under the whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States for false claims and share in a portion of the government’s recovery. The civil lawsuit was filed in federal district court in the Western District of Oklahoma and is captioned United States ex rel. Southwind Construction Services, LLC v. The Ross Group Construction Corporation, et al., Case No. 15-0102-R (W.D. Okla.). As part of the resolution of this matter, the whistleblower will receive approximately $520,000.
