Eleventh Circuit Rejects FCA Appointments Clause Challenge

The U.S. Court of Appeals for the Eleventh Circuit has reversed a district court ruling that found the False Claims Act's (FCA) qui tam provisions unconstitutional. In United States ex rel. Zafirov v. Florida Medical Associates, LLC, the panel rejected a defense argument that the FCA violates the Appointments Clause by allowing private whistleblowers, or relators, to litigate on behalf of the government without being appointed as federal officers. This decision is significant for any company that does business with the federal government, particularly in the healthcare and defense sectors, as it reaffirms the viability of the primary enforcement mechanism for the government's main anti-fraud law within the circuit. The ruling addresses a constitutional question being litigated in other circuits, creating the potential for a split that could attract Supreme Court review. Counsel for businesses facing FCA exposure should track the progress of similar challenges nationwide and consider the implications of this evolving defense strategy in their litigation planning.