Supreme Court Should Decide FOIA Document Requests Are Not Per Se Public Disclosures under the FCA

The Supreme Court has granted certiorari in Schindler Elevator Corp. v. United States ex rel. Kirk, an appeal from the Second Circuit, agreeing to decide whether Freedom of Information Act (FOIA) document requests are per se public disclosures under the False Claims Act (FCA).  The Supreme Court should affirm the Second Circuit’s ruling by holding that the documents requested under FOIA are not per se public disclosures, because:

(1) documents retrieved under FOIA are not per se “Federal reports” or “investigation[s]” or any other enumerated source in the public disclosure bar;
(2) the government is often unaware of the fraud even though the government possesses documents evidencing the fraud;
(3) documents requested under FOIA generally are not known to the public unless the requestor publicizes them;
(4) potential whistleblowers may suspect fraud but be unable to state a claim or assess the merits of their claim without requesting documents under FOIA;
(5) any person who detects fraud unknown to the public without using a source enumerated in the public disclosure bar should be rewarded for coming forward with the information, regardless of who they are;
(6) by definition, an incentive, such as the FCA reward, is intended to leverage opportunism, otherwise a reward would be unnecessary to begin with;
(7) FCA liability requires that the company know or have reason to know about the false claim, punishing claims that are intentional or negligent, not minor transcription errors; and
(8) if a regulation is too burdensome, its utility should be scrutinized in a public forum by the appropriate federal regulator and Congress, ensuring that the regulation is carefully debated and expert testimony is presented, not left to the self-serving discretion of the companies being regulated.

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Tagged: False Claims Act (FCA), Whistleblower Laws (Federal)