Bradley attorney Elisha Kobre talked with Law360 about the Supreme Court’s debate over the False Claims Act punishment for regulatory violations and its impact on fraud enforcement.
In two of these cases, whistleblowers have asked the justices “whether and when a defendant’s contemporaneous subjective understanding or beliefs about the lawfulness of its conduct are relevant to whether it ‘knowingly’ violated the FCA.”
Kobre said that the defendants have a stronger stance on precedent, while the whistleblowers have a better stance on the statutory texts, and that both sides can legitimately assert that their policy positions are more sensible. Interpretations of FCA regulations create difficult cases, such as the current two before the Supreme Court.
“[The relators] have the side of the policy argument that says this is going to knock the legs out from underneath the FCA and make it more difficult for the government to prevail. On the defense side, you have the policy argument that says this is kind of a punitive statute, with treble damages, and defendants shouldn’t be held to account for that without some very clear understanding of what the legal requirements are,” Kobre stated.
Oral arguments for these cases are likely to take place in April, and Supreme Court rulings are anticipated by late June.
The full article, “Justices Ignite FCA Debate: Fairness vs. ‘Invitation to Fraud,’” was published in Law360 on January 17, 2023. (login required)