The Fourth Circuit recently issued a decision interpreting the anti-retaliation
provision of the False Claims Act (FCA). The decision
provides important clarification about how courts may interpret
2009 and 2010 amendments to the anti-retaliation provision.
Specifically, it finds that courts may inquire whether the
employee's underlying complaint of FCA fraud is objectively and
subjectively reasonable. Congress
first enacted the FCA during the Civil War to protect the
government from fraudulent claims for payment. The FCA's two
key provisions impose liability for any person (1) who
"knowingly presents . . . to an officer or employee
of the United States Government . . . a false or
fraudulent claim for payment or approval" or (2) who
"knowingly makes, uses, or causes to be made or used, a false
record or statement to get a false or fraudulent claim paid or
approved by the Government." 31 U.S.C.
§ 3729(a)(1)-(2). The FCA contains an
anti-retaliation provision. 31 U.S.C.
Prior to 2009, the anti-retaliation provision applied only to
employee conduct "in furtherance of an action under this
section, including investigation for, initiation of, testimony for,
or assistance in an action filed or to be filed under this
section." Congress amended the statute in 2009 and 2010.
The statute now applies to employee conduct "in furtherance of
an action under this section or other efforts to stop 1 or more
violations of this subchapter." Thus, an employee
potentially can demonstrate protected activity either by showing
steps taken (1) in furtherance of an FCA action or (2) to stop a
violation of the FCA.
In Carlson v. Dyncorp International, LLC, the Fourth
Circuit interpreted for the first time the "other
efforts" language in the FCA anti-retaliation provision.
Carlson claimed that the company terminated him for complaining
about the indirect cost rate that the company used to bid for a
project for the United States Agency for International Development
(USAID). The district court granted the company's motion
to dismiss, finding that Carlson's allegations did not
establish that he engaged in protected activity under the FCA's
The Fourth Circuit affirmed the district court's decision,
but concluded that the district court used a standard based on the
pre-2009 FCA anti-retaliation provision. The district court
concluded that the employee had to allege that he was investigating
matters that reasonably could lead to a viable FCA action, also
called the "distinct possibility" standard. The
Fourth Circuit concluded that the district court's analysis
applied only to the "furtherance" prong of the
To establish that he satisfied the "other efforts"
prong, the Court found, the employee had to show that his efforts
to stop a violation of the FCA were based upon an objectively and
subjectively reasonable belief of an FCA violation. In other words,
the appropriate inquiries, according to the Court, are "does
[the employee] allege facts sufficient to show that he believed
[the employer] was violating the FCA, that his belief was
reasonable, that he took action based on that belief, and that his
actions were designed to 'stop 1 or more violations of' the
Applying this standard, the Fourth Circuit concluded that the
employee failed to show that his belief was objectively reasonable.
The employee's theory amounted to a claim that the company was
"under billing the government on existing
contracts." Under billing, however, does not constitute
an FCA violation. The Fourth Circuit emphasized that the
employee nowhere explained "how or which provisions" had
been violated by the claimed under billing. As a result, the
Fourth Circuit affirmed the district court's grant of the
employer's motion to dismiss.
It is commonly understood that under the FMLA, an eligible employee of a covered employer is entitled to 12 workweeks of leave during a 12-month period for the birth of a child, the placement of a child for adoption or foster care, . . .
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