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ARTICLE · 29 SEPTEMBER 2010

Ninth Circuit Weakens Rule 9(b) In False Claims Act Litigation

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The U.S. Court of Appeals for the Ninth Circuit recently weakened the impact of Federal Rule of Civil Procedure 9(b) in False Claims Act ("FCA") cases.

United StatesGovernment, Public Sector
Robert Hurwitz
Robert Hurwitz
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The U.S. Court of Appeals for the Ninth Circuit recently weakened the impact of Federal Rule of Civil Procedure 9(b) in False Claims Act ("FCA") cases. The FCA allows whistleblowers (called "relators") to bring lawsuits against contractors on behalf of the federal government. Relators can receive up to 30 percent of the government's ultimate recovery. This bounty incentivizes relators to bring FCA lawsuits. It also causes some relators to see the FCA as a retirement-advancing lottery, and their complaints often characterize innocent business challenges as fraudulent schemes.

Contractors attempt to eliminate these meritless suits by arguing that the complaints lack sufficient detail. Under Federal Rule of Civil Procedure 9(b), FCA complaints must "state with particularity the circumstances constituting fraud." In fraudulent scheme complaints, the relators recite the proverbial "parade of horribles," overemphasizing perceived inadequacies in billing practices, quality

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