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Supreme Court hears arguments on False Claims Act statute of limitations
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Supreme Court hears arguments on False Claims Act statute of limitations

The US Supreme Court heard oral arguments Tuesday in Cochise Consultancy v. United States, ex rel. Hunt on whether the discovery rule in the False Claims Act (FCA) statute of limitations should apply to lawsuits where the government has not intervened.

The FCA allows private citizens to file a qui tam action against a person they discover is defrauding the government and receive a portion of the recovery.

The Supreme Court interpreted the FCA in 2010 Graham County Soil & Water Conservation District v. United States ex rel. Wilson, holding that the law does not apply if the fraud has already been discovered by government agency. The court held that § 3730 actions are limited to when the US is a party, either where it filed a complaint or intervened.

Petitioner argued that a textual reading of § 3731(b)(2) indicates that it only refers to the US, and the statute of limitation is triggered by the knowledge of the US officials responsible to act under the circumstance, who must do so within three years.

Respondent took the position that § 3731(b) statute of limitations applies equally to both the US and to relators. Respondent argued that Graham is distinguishable in that Congress did not provide an applicable statute of limitations to the retaliation provision until its 1986 amendment.

In support of the Respondent, the US argued that relator and the US have the same deadlines for filing suit, meaning that the six-year limitation in § 3731(b)(1) expires on the same day as three-year tolling rule in § 3731(b)(2).