Earlier this month, Senator Chuck Grassley sent a letter to Attorney General William Barr, expressing concern over the Department of Justice (DOJ) “efforts to dismiss greater numbers of qui tam (false claims) cases for reasons that appear primarily unrelated to the merits of individual cases. Those efforts rely at least in part on vague and at times questionable concerns over prerogatives or limited government resources to handle the cases.”
Senator Grassley, who sent the letter in his capacity as Chairman of the Senate Committee on Finance, believes that such actions have the ability to “undermine the purposes of the False Claims Act [(FCA)] by discouraging whistleblowers and dismissing potentially serious fraud on the taxpayers.”
Grassley has asked AG Barr for details on the role of DOJ guidance in its efforts to dismiss the claims, especially the 2018 Granston memo. The 2018 Granston memo was issued by the DOJ’s Commercial Litigation Branch and outlines when DOJ can seek to dismiss fraud cases brought by whistleblowers on behalf of the government. FCA cases have led to the recovery of more than $59 billion since 1986.
Senator Grassley has always been a champion of the False Claims Act, including the 1986 update, which allowed whistleblowers alleging fraud against the government the ability to file qui tam suits on behalf of the government and share in any recoveries. The 2018 guidance allows for the government to seek a case’s dismissal for a number of vague reasons, including the preservation of government resources. Since the memo was issued, the government has used that rationale to pressure courts to dismiss cases—arguing that litigation would be too burdensome—without having first performed a sufficient cost-benefit analysis.
“The facts show that the False Claim Act is working. The qui tam provisions have reinvigorated an Act which had been mostly left for dead after the 1940s. In order for the law to continue working, DOJ must let the qui tam provision work the way it was intended and allow relators to proceed with litigation on their own,” Grassley wrote.
Throughout the six-page letter, Senator Grassley outlined a number of examples where the government moved to dismiss FCA cases on the grounds outlined in the Granston memo without first conducting cost-benefit analyses or other evaluations of the merits of a case. Grassley seems particularly upset in instances where the DOJ declines to intervene due to implied lack of merit, stating that “DOJ has implied that cases where it declines to intervene lack merit or face little chances of success. History has shown that the opposite is true. Since 1986, relators have recovered over $2.4 billion for the federal government via claims in which DOJ chose to not intervene. For example, that’s $599,038,273 in qui tam cases in 2017 alone. Furthermore, DOJ has repeatedly asserted that a decision to not intervene in a case is based on several factors including resource constraints.”
Some of the questions Grassley asks in the letter relate to a specific case (United States, ex rel. Campie v. Gilead Scis. Inc.), while others are more generally focused on how many cases the DOJ has moved to dismiss since the Granston memo. Senator Grassley requested a response no later than September 18, 2019.