Awards in Qui Tam Actions
Whistleblowers who risk reporting fraud on the government are potentially entitled to monetary whistleblower rewards under the False Claims Act. The False Claims Act provides that private individuals, or whistleblowers, can file civil lawsuits on behalf of the government against an individual, company, or other organization that commits fraud on the government. If the defendant is found to have violated the False Claims Act, it will be ordered to pay three times the amount of monetary damages sustained by the government, plus a penalty of up to $11,000 per false claim submitted by the defendant. The person who initiated the successful lawsuit (i.e., the relator) may receive a portion of the damages paid to the government as a whistleblower reward.
Whistleblowers May Receive Between 10-30% For Bringing The Qui Tam Action
The qui tam provisions of the False Claims Act not only provide whistleblower protection, but also whistleblower rewards in the form of financial incentives. The False Claims Act provides a significant monetary recovery to private persons who bring qui tam actions. The relator who initiates a successful qui tam lawsuit receives a percentage of the penalty and damages. Generally, the whistleblower may receive a reward of between 15-30% of the government’s total recovery. Thus, if the government recovers $1 million, the whistleblower may receive a reward of between $150,000 and $300,000. The exact amount depends on the circumstances of the case. For example, a whistleblower may receive:
- 25-30% if the government did not intervene in the action.
- 15-25% if the government intervened in the action.
- 10% or less if the government intervened in the action and most of the information relevant to the lawsuit was publicly available.
- A reduced amount if the relator planned and initiated the false claims that formed the basis of the qui tam action. If the relator is convicted of a crime associated with the false claims, the relator will not receive anything.
The percentage the relator receives is determined by the court handling the case after it considers the overall situation, including the relator’s contribution to the action. The relator may also be awarded reasonable expenses and attorney’s fees.
If you have knowledge of a fraud committed against the government, you may be entitled to receive a whistleblower reward if you report the fraud and the government successfully recovers on a whistleblower claim. For more information about whistleblower rewards and whistleblower lawsuits, contact Michael S. Bigin or Laurence J. Hasson.