11th Cir. Upholds False Claims Act Qui Tam Provision
The court reversed a district court's finding of unconstitutionality, joining four other circuits in holding that private whistleblowers are not 'officers' subject to the Appointments Clause.
The U.S. Court of Appeals for the Eleventh Circuit reversed a Florida federal district court, upholding the constitutionality of the False Claims Act's (FCA) qui tam provisions. The lower court had invalidated the provisions, which allow private citizen "relators" to sue on behalf of the government, reasoning they were "officers of the United States" who must be appointed by the President under the Appointments Clause. The Eleventh Circuit disagreed, finding relators do not hold a "continuing position" and are therefore not officers.
This decision resolves significant uncertainty for FCA defendants and relators in the Eleventh Circuit and aligns it with four other circuits that have rejected similar constitutional challenges. The FCA is a critical enforcement tool and a source of massive potential liability for government contractors and healthcare providers. A contrary ruling would have disrupted a pillar of federal fraud enforcement.
The constitutional fight is not over. The appellate court remanded the case for the district court to consider other Article II arguments. With several Supreme Court justices having expressed skepticism about the qui tam framework, and a similar challenge pending in the Third Circuit, counsel should monitor the case for further appeals, as the issue may eventually reach the Supreme Court.