How are Whistleblowers Rewarded Under the False Claims Act?
A plaintiff, or relator, who sues on behalf of the United States to recover taxpayer money that has been lost to fraud is entitled by statute to receive a reward, which is called a “relator’s share.” The FCA provides that if a case is successful, the relator can receive an award ranging between 15% to 30% of the total amount recovered by the Government.
After a complaint is filed under the FCA, the government is charged with further investigating the claims to see if they have merit, and to determine whether the government should proceed with the action. If the government decides to intervene in the case and brings the case to a successful conclusion by settling or obtaining a judgment after trial, the relator’s award can range from 15% to 25% of the recovery. The factors that are used to determine where a relator’s share should fall within that range include (1) the significance of the information provided by the Relator; (2) the contribution of the person bringing the action to the results achieved; and (3) whether the information which formed the basis of the suit was known to the Government. Generally, when the Department of Justice (“DOJ”) intervenes in a case, the relator’s share ranges from 17% to 22% of the amount recovered, depending largely upon the contribution the relator makes to a successful outcome. In other words, if the case the relator files is so strong that the government has to do little or no additional investigation, then the relator’s share award will be on the higher end of the range. If the case requires substantial additional investigation by the United States, then the relator’s share awarded will likely be on the low end of this range. That is another reason to make sure, before you file case, that you have gathered strong evidence of fraud, so that the government’s investigation will proceed quickly, with few obstacles to reaching a favorable conclusion. The Department of Justice has developed its own internal guidelines to help calculate a relator’s share award, and you can read those guidelines by clicking here.
In some cases, the government may decide not to intervene in a FCA case after conducting an investigation. The government reaches that decision for many reasons, including lack of resources, prosecution priorities or simply because it believes the relator, with his counsel, can independently pursue the case successfully. In those instances, the complaint is unsealed, and the complaint is served upon the defendant. Litigation then proceeds in the usual way, with the relator’s counsel taking the lead role in discovery and at trial. Where the relator proceeds without the United States he or she may receive a relator’s share award between 25% to 30% of the amount recovered. Experience has shown that in most declined cases, that is, where the relator litigates the case with his counsel, the recovery is 28%-29%.