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ARTICLE · 23 MARCH 2017

MWI Case Shows The False Claims Act Needs A Change

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Imagine your company becomes the subject of a U.S. Department of Justice investigation, which goes on for 30 months and ends with no grand jury indictment or criminal prosecution.

United StatesCriminal Law
Robert Rhoad
Robert Rhoad
William Bucknam
William Bucknam
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Imagine your company becomes the subject of a U.S. Department of Justice investigation, which goes on for 30 months and ends with no grand jury indictment or criminal prosecution. Then, in a recalcitrant pivot, the DOJ decides to intervene in a complaint, previously filed under seal years earlier by a qui tam relator (colloquially referred to as "whistleblower") under the federal civil False Claims Act, 31 U.S.C. §§ 3729-3733, triggering the complaint to become unsealed and prompting active litigation. The company suddenly finds itself subjected to potential treble damages and penalties of nearly $225 million, even though the company was not (or ever) suspended or disbarred from government contracting.

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