The California False Claims Act protects whistleblowers and employees who have allegations of fraudulent activity happening in the workplace. Workers who notice fraudulent activity and report on the activity may not be retaliated against by the employer. If the employee is retaliated against, the False Claims Act provides civil penalties for the employee.
What is a false claim?
The False Claims Act protects and grants employees civil penalties employees who observe tax fraud, tax evasion, embezzlement, or other types of financial crimes. Under the claims act, a ‘claim’ would be a request for compensation or services from the employer or government entity. The types of claims that could be made under the False Claims Act include:
-Falsifying documents or record that relates to the fraudulent claim
-Knowingly presenting a false document or statement for approval or payment
-Engaging in conspiracy or fraud
-Falsifying tax records
-Embezzlement
-Falsifying documents or records to conceal or avoid an obligation to pay the government
-Failure to disclose information to the government
Some of these claims are not easy claims to prove in court. To be able to prove that there is a false claim, the employer or government entity had to have acted with knowledge of what they were doing, deliberate incompetence, or reckless disregard for the law.
What is a ‘Qui Tam” false claim suit?
A qui tam under the False Claims Act are lawsuits filed by private citizens or employees towards their employers. The plaintiff in a qui tam suit is filing a claim against the defendant on behalf or in the name of a government entity who’s property or assets were misappropriated. California employees often bring these claims up against their employers who work with the local or state governments, which include schools and construction companies working on a government project. For example, Alex owns an artificial grass company that is working with the local courthouse to install new landscaping. Shaun is in charge of all the billing and accounting when billing the government. After a while, Shaun starts to notice that Alex has been inputting more orders for artificial grass to be used in the government building, but is keeping it for future use. Shaun totals the amount to several hundred thousand dollars. After going to Pride Legal and speaking with an attorney, they decided that Shaun would be able to file a qui tam false claim against Alex’s company.
How can I file a claim under the False claim?
To start with your false claim or qui tam claim, get in contact with an attorney. However, there are some exceptions when filing these claims. If the employee had discovered the discrepancies in the company during their employment with the state or local government, they must first go through the internal procedures. This means reporting it to the company or government entity themselves and having an internal investigation, and earning compensation. If the employee and attorney agree that the compensation or the investigation had not been handled properly, then they would be able to file a suit. The statute of limitations for filing a false claim is 6 years after the California False Claim Act violation occurs. If it is a qui tam claim, the statue is no more than 3 years after the knowledge of the violation, but in no event, over 10 years after the violation occurred.
What damages and compensation could I receive?
The amount of compensation and penalties one can receive is based on the claim and the amount of fraud that had occurred. The plaintiff would receive:
-3 times the amount of loss that he/she caused the government
-A civil penalty between $5,000 and $11,000
-Attorney’s fees and other court associated costs
-Any loss of payment or benefits
There are also differences between a qui tam suit and a false claim suit payout. In a qui tam suit, the plaintiff is entitled to a portion of the compensation. If the attorney general or prosecutor takes over the case, then the plaintiff would receive 15%-33% of the compensation. If they do not take over the case, then the plaintiff would be entitled to 25%-50% of the compensation. This potentially could be millions of dollars.
Contact Pride Legal
If you or a loved one has observed fraudulent activity, we invite you to contact us at Pride Legal for legal counseling or any further questions. To protect your rights, hire someone who understands them.