Al is an accountant for a large defense contractor, Bomb, Inc. In his work, he learns that Bomb, Inc. is overstating its expenses on government contracts and defrauding the federal government out of millions of dollars. Al can sue Bomb, Inc. on behalf of the government (a qui tam action). If he wins, the bulk of the damages will go to the government, but a share will go to Al.
Qui tam action
Definition
In a qui tam action, a private party called a relator brings an action on the government's behalf. The government, not the relator, is considered the real plaintiff. If the government succeeds, the relator receives a share of the award. Also called a popular action.
For example, the federal False Claims Act authorizes qui tam actions against parties who have defrauded the federal government. 31 U.S.C. § 3279 et seq. If successful, a relator in a False Claims Act qui tam action may receive up to 30% of the government's award.
Illustrative caselaw
See, e.g. United States ex rel Eisenstein v. City of New York, 129 S.Ct. 2230 (2009).
See also
Intervention (the government may intervene in a qui tam action)
Definition from Nolo’s Plain-English Law Dictionary
(kwee-tam) Latin for "who as well," a lawsuit brought by a private citizen but brought for "the government as well as the plaintiff." This type of action is generally based on significant legal violations which involve fraudulent or criminal acts, and not technical violations or errors. If successful, the plaintiff ll be entitled to a percentage of the recovery of the penalty as a reward for exposing the wrongdoing and recovering funds for the government.
Definition provided by Nolo’s Plain-English Law Dictionary.
August 19, 2010, 5:22 pm
