1. Ethics in False Claims Act Qui Tam relators personal claims offense and defense

2. False Claims Act Qui Tam Litigation: relators ‘ personal claims
Taxpayers Against Fraud Education Fund Conference
Panel Presentation –October 3, 2018
 Jason Marcus, Bracker & Marcus LLC, Panel Chair
Avi Kumin, Katz, Marshall & Banks, LLP
Ann Lugbill, Murphy Anderson PLLC
Robin Potter, Potter Bolanos LLC

3. Constructive Discharge; Pain, Suffering, and Emotional Distress;
What to Allege?
Title VII-Sex, Race, National Origin, Color, Religion; ADEA & Disability Discrimination; FLSA and other Wage & Hour Claims; and especially the Retaliation Statutes;
Whistleblower Protections for Government Contractors Employees-Fair Pay and Safe Workplaces Executive Order/Executive Orders re Federal Government Contractor Minimum Wage & EEO Reporting/ NDAA Amendments Providing Retaliation Protection for Defense Contractor Employees;
False Claims Act Retaliation Statute 3730(h); State Whistleblower Statutes & Public Policy Common Law Theories;
State Breach of Contract; Defamation & Slander; State Breach of Duty of Good Faith; Intentional Infliction of Emotional Distress;
Constructive Discharge;
Pain, Suffering, and Emotional Distress;
and Many More.

4. Common Employment Retaliation Claims for Relators
National Defense Authorization Act for Fiscal Year 2016 (NDAA) / Defense Contractor Whistleblower Protection Act
Sarbanes-Oxley Act of 2002 (SOX)
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010
Wrongful Termination in Violation of Public Policy

5. 2013 National Defense Authorization Act (NDAA) “Enhancement of Whistleblower Protections for Contractor Employees”

6. 2013 NDAA Amendments – Retaliation Prohibited
Contractors and subcontractors are prohibited from discharging, demoting, or otherwise discriminating against an employee as a reprisal for disclosing, to any of the entities listed… information that the employee reasonably believes is evidence of gross mismanagement of a Federal contract, a gross waste of Federal funds, an abuse of authority relating to a Federal contract, a substantial and specific danger to public health or safety, or a violation of law, rule, or regulation related to a Federal contract….

7. 2013 NDAA Amendments – Disclosures Protected from Retaliation
Qualifying “disclosures” to:
* Member of Congress or congressional committee representative;
* Inspector General
* Government Accountability Office (GAO)
* Federal employee responsible for contract or grant oversight or management at the relevant agency
* Authorized official of the DOJ… or law enforcement agency
* Court or grand jury
* Contractor, subcontractor, or grantee manager or employee with “responsibility to investigate, discover, or address misconduct.”
Interim Rule

8. DCWPA / NDAA Retaliation 10 U.S.C. § 2409, 41 U.S.C. § 4712
Covers: employees, contractors, and subcontractors of government contractors
Protected activity: includes disclosures related to a federal contract or grant of –
Gross mismanagement, gross waste of funds, or abuse of authority
Violation of law, rule, or regulation
Danger to public health or safety
Causation standard: plaintiff proves that protected activity a “contributing factor” to adverse action; burden then shifts to defendant to prove by “clear and convincing evidence” that it would have taken the same action notwithstanding the protected activity
Filing and Litigation: complaint filed with the DOD or relevant agency’s Office of Inspector General within 3 years, with a 210-day option to “kick-out” to federal court
Damages: back pay, special damages, reinstatement, attorneys’ fees and costs

9. Sarbanes-Oxley (“SOX”) Retaliation, 18 U.S.C. § 1514A
Covers: employees and contractors of publicly traded companies and their subsidiaries
Protected activity – includes reports of:
Mail, wire, bank, or securities fraud;
Violation of SEC rules and regulations; or
Violation of federal laws related to fraud against shareholders
Causation standard: ‘contributing factor’ standard
Filing: complaint must be filed with OSHA within 180 days of the adverse action
Litigation: can appeal to DOL Office of Administrative Law Judge, with 180-day option to “kick-out” to federal court
Damages: include back pay, front pay, compensatory damages, reinstatement, and attorneys’ fees

10. SEC Whistleblower Program Retaliation Provision, 15 § 78u-6(h)(1)
Protected activity: providing information to the SEC regarding violations of U.S. securities laws in accordance with the SEC whistleblower rewards program; testifying or assisting in SEC investigations related to this program; and/or making disclosures required/protected under SOX or other laws, rules, and regulations of the SEC
SEC reporting only: to be protected, plaintiff must have made protected disclosures to the SEC pursuant to the SEC’s procedures for the whistleblower rewards program
Litigation: file directly in court, subject to three year statute of limitations “after the date when facts material to the right of action are known or reasonably should have been known to the employee” (but further subject to an outer bounds of six years)
Damages: double back pay, front pay, reinstatement, and attorneys’ fees

11. Consumer Finance Protection Act
Protected activity:  opposition to violations of Title X of the Dodd-Frank Act, a CFPB regulation, or any other consumer financial protection law that the CFPB enforces, including laws regulating “unfair, deceptive, or abusive practices related to the provision of consumer financial products or services.”
Industries: includes mortgage lending and servicing, student loans, credit cards, consumer credit reporting, etc.
Causation standard: ‘contributing factor’ standard
Filing: file with OSHA within 180 days of the adverse action
Litigation: can appeal to DOL Office of Administrative Law Judge, with option to “kick-out” to federal court
Damages: back pay / front pay, compensatory damages, reinstatement, attorneys’ fees

12. Wrongful Termination in Violation of Public Policy

13. Wrongful Termination in Violation of Public Policy
Exception to the “at-will” employment doctrine
Protects employees who are terminated for opposing or refusing to participate in conduct that violates a specific public policy. Often broad coverage.
Typically based on common law, but sometimes statutory. Claims vary by state:
DC: federal or DC statute or regulation, DCWPA
VA: Virginia law only, plaintiff within class to be protected
MD: covers only external reports to government agency
Potential preemption issues where a retaliation remedy is available under FCA or another statute

14. “Honest Abe Lincoln”-Approved Other possible employment claims
Other whistleblowing statutes, in transportation, environmental, nuclear, etc. industries
Look at the Department of Labor’s Whistleblower and Retaliation collection of statutory protections
Breach of contract / state wage payment laws
EEO discrimination or retaliation

15. False Claims Act Retaliation Claims Don’t Forget Hiring Protections

16. Common Counterclaims against Relators
Misappropriation of Documents (Breach of Contract)
Breach of Fiduciary Duty
Disparagement

17. Misappropriation of Documents (Breach of Contract)
Breach of contract counterclaims typically based on provisions in employment or separation agreements requiring employee to not disclose company’s confidential information
Documents related to the qui tam, as necessary for the qui tam: generally dismissed on public policy grounds
Documents unrelated to the qui tam, or beyond what is necessary for the qui tam: generally tend to survive motion to dismiss stage

18. Breach of Fiduciary Duty
Premised either on disclosure of company secrets to attorney/DOJ, or failure to disclose claimed violations of law to the company before disclosing to attorney/DOJ
Dismissed where claims amount to claims for indemnification or contribution
Dismissed on public policy grounds, where damage from alleged breach is essentially the damage caused by the act of being a relator
Typically dismissed at the motion to dismiss stage

19. Honest abe --& (HONEST Robin’s and Honest AVI’s) Practice Tips
Clients should not over-gather documents, take only documents related to the qui tam
After reviewing the documents, do not keep irrelevant documents. Delete, retain, or leave with filter counsel?
“What Not to Do”: U.S. ex rel. Cafasso v. Gen. Dynamics C4 Sys., Inc., 637 F.3d (9th Cir. 2011)
Relator gathered nearly 11 gigabytes of data (tens of thousands of pages) from company computers
Indiscriminate copying of whole folders
Including attorney-client privileged communications, trade secrets, etc.
Discovery violations

20. Disparagement Disparagement outside of the FCA reporting process
Counterclaims may be premised on a breach of a non- disparagement provision in an employee contract or separation agreement
Claim may be viable if it involves conduct that is independent of the FCA claims, i.e. not premised on defendant’s liability

21. Negotiating Settlement Agreements
Timing and scope of settlement:
Speed of resolution, amount of resolution
Desire to report to the government
Other non-economic considerations
Release considerations:
Pre- or post-disclosure to government
Language stating can’t report to government, or can’t profit from report to government
Carveouts for vested benefits, continuing claims
Mutual release of claims
Return of documents

22. Settlement Principles Model Rule 1.4 Communication
(b) A lawyer shall explain a matter to the extent reasonably necessary to permit the client to make informed decisions regarding the representation.

23. Settlement Principles Model Rule Rule 1.8 Conflict Of Interest
(g) A lawyer who represents two or more clients shall not participate in making an aggregate settlement of the claims of or against the clients...unless each client gives informed consent, in a writing signed by the client. The lawyer's disclosure shall include the existence and nature of all the claims …involved and of the participation of each person in the settlement.

24. Settlement Principles Model Rule 5.6 Restrictions On Right To Practice
A lawyer shall not participate in offering or making:
(a) a partnership, shareholders, operating, employment, or other similar type of agreement that restricts the right of a lawyer to practice after termination of the relationship, except an agreement concerning benefits upon retirement; or 
(b) an agreement in which a restriction on the lawyer's right to practice is part of the settlement of a client controversy. (emphasis added)

25. Many Thanks to TAF, TAFNET, TAFEF, TAFEF Staff and Board, Conference Planning Committee, and our Silent Partner, Abraham Lincoln

26. False Claims Act Qui Tam Litigation: relators’ personal claims
Taxpayers Against Fraud Education Fund Conference
Panel Presentation –October 3, 2018
 Jason Marcus, Bracker & Marcus LLC, Panel Chair
Avi Kumin, Katz, Marshall & Banks, LLP
Ann Lugbill, Murphy Anderson PLLC
Robin Potter, Potter Bolanos LLC