Just
as our compensation is contingent
on the outcome of any qui tam case, the amount that a relator may
recover is contingent on a recovery by the government. The
amount that the relator can receive most often ranges from 15% to
30%, depending on whether the government intervenes in the case
and the extent to which the relator substantially contributed to
the prosecution of the action.
If the government intervenes in the action, a successful relator
will receive between 15% and 25% of the amount recovered by the
government. The exact percentage is usually negotiated with the
government at the conclusion of a successful case and will depend
on the relator’s substantial contribution to the litigation.
If the percentage cannot be agreed upon by negotiation, the court
will be asked to decide the matter. The Department of Justice reports
that the average relator’s share award is approximately 16%
of the amount recovered by the government.
If the government does not intervene in the case and the relator
continues the action to a successful outcome, the relator will be
entitled to between 25% and 30% of the amount recovered for the
government. At first glance, it may seem more profitable for a relator
to pursue a case without the government’s assistance, but practical
reality dictates otherwise. The government’s participation
is like having the proverbial 800-pound gorilla on your side. As
a result, the vast majority of successful False Claims Act cases
occur when the government opts to intervene in the case.
It
is important to note that there are circumstances in which a relator
may be entitled to receive less than 15% of the amount recovered
by the government. If the relator’s suit is one that is found
to be “based primarily on disclosures of specific information”
relating to allegations or transactions from public sources (other
lawsuits, government hearings or investigations, or news reports),
the relator may be entitled to no more than 10% of the proceeds
of the case.
If the person bringing the case is one “who planned and initiated
the violation” of the False Claims Act, the relator’s
share may be reduced “to the extent the court considers appropriate
. . . taking into account the role of that person in advancing the
case to litigation and any relevant circumstances pertaining to
the violation.”
Finally, if a relator is convicted of criminal conduct arising from
his or her role in violating the False Claims Act, the relator will
be dismissed from the qui tam case and will not receive any share
of the proceeds received by the government.
To give you an idea of how the relator’s share award is determined,
here is a typical example. Assume that you file suit against a health
care provider or defense contractor and after several years of assisting
the government with its investigation, the government decides to
intervene in the case and successfully negotiates a settlement with
the defendant. The defendant agrees to pay the government $10 million
for its violations of the False Claims Act. Absent unusual circumstances,
you will be entitled to recover at least 15%, or $1.5 million, and
as much as 25%, or $2.5 million. Obviously, if the recovery is for
a different amount, the amount of the relator’s share will
vary proportionately.
