The authors consider the U.S. District Court for the District of Columbia's certified interlocutory appeal on the question of the appropriate method for calculating damages offsets for False Claims Act defendants.
The U.S. Court of Appeals for the D.C. Circuit soon may determine how to calculate damages offsets for False Claims Act ("FCA") defendants after a recently certified interlocutory appeal. The appeal arises out of a longstanding FCA case involving Zylon body armor shields ("Z Shield"), which were incorporated as part of bulletproof vests. The vests were sold to law enforcement agencies, which were eligible for partial reimbursement from the federal government.
BACKGROUND
In 2008, the United States filed separate FCA suits against several defendants related to the Z Shield vests. Some defendants have settled, but litigation remains ongoing.
One Z Shield manufacturer moved for summary judgment on numerous grounds, including that it was entitled to a pro tanto offset for the government's settlements with other defendants, which would reduce the FCA damages recoverable from the manufacturer to zero. A pro tanto offset would allow a dollar-for-dollar credit for other defendants' settlements. Under this theory, once the government has recovered the full amount it is due for its injury (here, the amounts the government paid or reimbursed for the allegedly...
