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The False Claims Act in Transition: A Mediator's Perspectives on Emerging Trends

I have worked on False Claims Act (FCA) cases throughout my career, and according to the U.S. Department of Justice, FCA cases have never been more popular than they are today. [See https://www.justice.gov/opa/pr/false-claims-act-settlements-and-judgments-exceed-68b-fiscal-year-2025 (“Settlements and judgments under the False Claims Act exceeded $6.8 billion in the fiscal year ending Sept. 30, 2025, . . . . That amount is the highest in a single year in the history of the False Claims Act. This year, whistleblowers filed 1,297 qui tam lawsuits, the highest number in a single year, and the government opened 401 investigations[.]”)]. That popularity, combined with efforts by the current administration to expand its application to nontraditional areas and a drastic reduction in the federal prosecutorial workforce, seems to have brought about a number of changes in how these cases are handled. Below are several trends I’ve observed while mediating FCA cases.

1. Faster declinations

When I handled FCA cases in private practice—and this applies to some of the early cases that I mediated—it was common for the federal government to take years to investigate a case before deciding whether to intervene. Today, I’m seeing the federal government make its decision in less than a year; in one case I mediated, the federal government declined intervention in six months, and that was because it was confident the case was meritorious (see next point). Of course, this is not happening in every case, but faster declinations are becoming more common.

2. Declinations aren’t what they used to be

For most of my career, defense counsel would pray, push and prod for a declination, which, after a lengthy government investigation, would be considered—and used as—evidence that the case lacked merit. Then when the U.S. Department of Justice published the Granston Memo (Jan. 10, 2018), which empowered U.S. attorney’s offices to consider moving to dismiss a case when declining to intervene, defense counsel thought they had been handed the holy grail. [(“Thus, when evaluating a recommendation to decline intervention in a qui tam action, attorneys should also consider whether the government's interests are served, in addition, by seeking dismissal pursuant to 31 U.S.C. § 3730(c)(2)(A).”). Granston Memo, p.1] Well, things have changed.

Nowadays, in my mediation of FCA cases, I regularly speak with the assistant U.S. attorneys (AUSAs), even when the case has been declined. I regularly hear about the improving quality of the cases brought by relator counsel and the preparedness of relator counsel to litigate, which seem to give the AUSAs the comfort to decline intervention because they believe the government’s interests will be well represented after a declination. Again, this is not descriptive of every case, but it is certainly a modern change to see AUSAs declining intervention because they believe the case does have merit and relator’s counsel is well prepared to litigate the matter. This then allows the federal government to use its limited resources elsewhere. I do not know of anyone who predicted this sort of development, but it is now one to keep in mind.

3. The rise of the state AG offices

I am also hearing that AUSAs’ confidence in their counterparts in state attorney general (AG) offices increasingly influences federal intervention decisions. Additionally, I have seen relator’s counsel more purposefully approach state AG offices and pitch them to intervene even if the federal government does not. And while the AG offices have tended to take a back seat to U.S. attorney’s offices and follow their lead, both in interventions and declinations, the AG offices are flexing their muscles and intervening even when the federal government has declined.

4. Changing relators

The typical image most attorneys have of a relator is a disgruntled former employee of the corporate defendant. That’s changing.

Whether it is the significant financial recoveries the government and relators are achieving or the media attention given to those recoveries, there are more nontraditional relators seeking their own recoveries. Public cases have shown that competitors and even vendors and clients are filing FCA cases. I have dealt with such in my mediated FCA cases, and I have also worked with corporations that have filed FCA cases. I think we are going to see more corporate relators, particularly insurance companies.

5. Mediation is popular

The popularity of mediation is increasing across the country in all types of litigated cases, but its use seems to be growing fast in the FCA context. Admittedly, when I was in private practice, I never used mediation to resolve an FCA case. In my years as a mediator, however, I have mediated numerous FCA cases, and each year the number increases. To me, the biggest factor influencing this increased use of mediation is the federal government’s increased frequency of declining cases and their faster declinations. First, this places the case squarely in the hands of private litigators, who are comfortable with using mediation, something the government usually does not do. Second, even for those relator counsel who are well positioned to litigate the matter themselves, they have an opportunity to use the draconian penalty structure of the FCA to secure a worthwhile settlement before they have to invest significant time and energy into the case. And third, defense counsel, being aware of this draconian penalty structure, can utilize mediation in an effort to mitigate their client’s exposure, especially before they too expend extensive resources on litigating the matter.

Time will tell how these trends develop and what new trends arise, but I offer these insights on how FCA cases seem to be evolving in today’s environment.

 

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This website is not a solicitation for business. All content on the JAMS website is intended to provide general information about JAMS and an opportunity for interested persons to contact JAMS. The content of this website is not offered as legal advice or legal opinion and it should not be relied upon for any specific situation.  JAMS neutrals are not engaged in the practice of law and no attorney client relationship is intended.  This website is for informational purposes only and does not constitute a complete description of JAMS services. While JAMS endeavors to keep the information updated and correct, JAMS makes no representations or warranties of any kind, express or implied, about the completeness, accuracy, or reliability of the information contained in this website. 

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