Eastern District Of Virginia Rules That Employer Cannot Arbitrate False Claims Act Retaliation Claims

Recently, the Eastern District of Virginia in Winston v. Academi Training Center, Inc., No. 1:12-cv-767 (July 12, 2012), declared an arbitration provision in an independent contractor agreement unconscionable, clearing the way for two plaintiffs to bring their False Claims Act (FCA) retaliation claims in Federal court. 

The plaintiffs were two firearms instructors previously employed by Academi Training Center, a Blackwater successor.  They claimed they witnessed other Academi contractors submitting false firearm certification records to the State Department.  Academi fired both instructors the day after they reported the fraudulent activity to their supervisor.  Academi claimed the instructors had failed to report the fraud in a timely manner, and had participation in the fraud.