On April 12, 2024, Valerie Cohen and Eva-Maria Ghelardi published “FCA Counterclaims – Defendants Can Proceed with Counterclaims Against False Claims Act Whistleblowers” for the American Bar Association. The following is an excerpt:
A recent federal district court ruling allowed a defendant in a federal False Claims Act (FCA) qui tam action to maintain counterclaims against the whistleblower, signaling potentially widened avenues for relief for FCA defendants. On February 27, 2024, the U.S. District Court for the Northern District of Georgia allowed Defendant, a medical equipment supplier, to maintain several counterclaims against an FCA qui tam relator, previously Defendant’s chief compliance officer. See U.S. ex rel. Cooley v. ERMI, LLC, et al., C.A. No. 1:20-CV-4181-TWT, 2024 WL 815514, at *1 (N.D. Ga. Feb. 27, 2024).
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The Cooley decision provides a roadmap that companies facing FCA claims can follow to pursue distinct remedies against whistleblowers, even when such counterclaims stem from the same underlying facts as the FCA claims. FCA Defendants should evaluate potential injuries imposed by the whistleblower’s actions during and after their tenure, as applicable, and determine whether counterclaims may be appropriate even if they arise from the same set of facts as the FCA case.
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