In United States ex rel. Polansky v. Executive Health Resources, Inc., the U.S. Supreme Court recently resolved a circuit split1 by holding that in a False Claims Act ("FCA") action (1) the Government may seek dismissal of a qui tam case that the government initially declined to intervene in over the relator's objection so long as it later intervened in the litigation, and (2) that in considering such a motion, district courts should apply the rule generally governing voluntary dismissal of suits: Federal Rule of Civil Procedure 41(a). Under Rule 41(a), the Court explained that the Government has broad latitude to seek dismissal; although that discretion is not unfettered, such "motions will satisfy Rule 41 in all but the most exceptional cases." The decision is an important one for the government and FCA defendants. But perhaps as important as the Court's central holding in the Polansky case (and certainly more surprising), was the view expressed by Justice Thomas in dissent (and echoed by Justice Kavanaugh in a concurring opinion joined by Justice Barrett) that the FCA's qui tam provision permitting a private citizen to litigate a case on behalf of the United States may be unconstitutional.
The FCA authorizes private parties (known as relators) to file civil actions "in the name of the government."2 When a relator files a complaint, they do so under seal and initially serve it only on the Attorney General. DOJ then has 60 days as an initial opportunity (often subject to multiple extensions for longer periods) to investigate the allegations and determine whether it will intervene in and take over prosecution of the case. If the Government declines to intervene, the relator has "the right to conduct the action."3 But even when the Government declines to intervene, it remains a real party in interest, and it retains certain rights, including the right to intervene later "upon a showing of good cause."4 The FCA also authorizes the Government to dismiss an "action notwithstanding the objections of the [relator]" subject to their being provided notice and a hearing.5
In Polansky, the relator, a doctor who worked for Executive Health Resources ("EHR"), alleged that EHR had helped hospitals overbill for Medicare-covered services. Polansky filed (under seal, as required) a qui tam action against EHR. After conducting an investigation, the Government declined to intervene during the seal period, enabling Polansky to proceed with the lawsuit. The case then spent years in discovery, with EHR demanding both documents and deposition testimony from the Government. As its discovery obligations mounted, the Government decided that the varied burdens of the suit outweighed...
