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Roderick Thomas Comments on Qui Tam Ruling Involving Relator Objections

Bloomberg BNA's Federal Contracts Report
April 26, 2012

Roderick Thomas, chair of Wiley Rein's White Collar Defense Practice, was quoted in a Federal Contracts Report story on a ruling by the U.S. Court of Appeals for the District of Columbia that the government may not settle a quitam case when the relator objects,  unless the court approves the settlement.

BNA reported the appeals court decision reversed a district court's ruling and stated that for a district court to dismiss certain qui tam claims, it must "hold a hearing to determine if a settlement was fair, adequate and reasonable."  In addition, the "opinion directly addressed the district court's doubts about the constitutionality of a False Claims Act provision requiring judicial approval of settlement agreements if relators object."

Mr. Thomas told BNA the decision is disappointing for those trying to resolve FCA matters a timely manner and without litigation.

"The decision allows self-interested relators to put up an additional hurdle to a settlement agreement that both the United States and defendant deem fair, perhaps leveraging a threat of litigation to pursue a larger payout," Mr. Thomas said. "This result is at odds with the qui tam provisions' intent that relators pursue FCA cases 'in the shoes' of the United States."