March 6, 2014

Supreme Court May Review Case Vastly Expanding False Claims Act Exposure

By Jesse A. Witten

The Supreme Court is deciding whether to review an important False Claims Act (FCA) decision of the Fourth Circuit, which held that the Wartime Suspension of Limitations Act (WSLA) has suspended the running of the FCA statute of limitations since the beginning of the war in Iraq and that the statute of limitations will not begin to run until five years after the president or Congress proclaims that the hostilities have terminated. See United States ex rel. Carter v. Halliburton Co., 710 F.3d 171 (4th Cir. 2013). The Court has asked the Solicitor General of the United States for its views, an indication that it may grant cert and review the decision. Two other district courts have similarly held that the FCA statute of limitations was suspended as a result of the war in Iraq, as well as the war in Afghanistan. No court has yet ruled that the WSLA does not apply to the FCA.

These rulings present tremendous risk to health care providers, pharmaceutical and medical device companies, defense contractors, financial institutions, and other government contractors. For Medicare and Medicaid providers, and for anyone who has done business with the federal government, the FCA statute of limitations has not begun to run for conduct occurring since 2001, when the armed conflict in Afghanistan began. Conduct occurring in 1995 would not be barred by the FCA’s six-year statute of limitations until at least five years after either the president or Congress declares that hostilities in both Iraq and Afghanistan have terminated, whenever that may be. If such proclamations occur in 2016, President Obama’s last year in office, the statute of limitations for conduct occurring in 1995 would not expire until 2021.

Drinker Biddle partner Jesse A. Witten and associate Lee Roach recently published an article in Law360 explaining how the courts have erred in their interpretation of the Wartime Suspension of Limitations Act. As they explain in their article "High Court Should Reverse 4th Circ.’s Flawed FCA Ruling."

To read the full article, please click here.

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